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Defining Property Rights in Kenya

Tavneet SuriTavneet Suri, Maurice F. Strong Career Development Professor, Associate Professor of Applied Economics

In 2012, Tavneet Suri, Maurice F. Strong Career Development Professor and associate professor of applied economics, led a team of researchers in Kibera— Africa’s largest slum located in Kenya’s capital city of Nairobi—to study how rents are set and how home improvements are made.

“Even in places where you don’t have formal institutions, informal institutions arise,” said Suri. “People raise a structure and say, ‘I own this structure and therefore I have rights, and I have enough rights that I can rent it.’ So these informal institutions arise and they have big consequences.”

Suri and her team surveyed residents, chiefs, and elders across Kibera’s roughly 3.75 square miles. The results reveal a socioeconomic system that finds favoritism along ethnic lines and sees roles for everyone from government-appointed administrators to street gangs.

Results of the survey are presented in “There Is No Free House: Ethnic Patronage and Property Rights in a Kenyan Slum,” a working paper by Suri; Thomas M. Stoker, Gordon Y Billard Professor in Management and Economics and professor of applied economics at MIT Sloan; and Benjamin Marx, a PhD student in the MIT Department of Economics.

The researchers found that when Kibera landlords share a tribe with the area chief, residents see higher rents by a measure of six to 11 percent. And when residents themselves share a tribe with their chief, rents will be lower by the same percentage.

They also found that areas of the slum with a high gang presence saw less egregious increases in rent. This may be because gang members, although often violent criminals, act as proxies for residents in disputes.

“It seems they protect people’s rights against landlords in some places,” Suri said, “they’re able to enforce some better behavior.”

Working in Kibera was not easy for the research team. “Every week in the field, we had an incident,” she said of the nearly yearlong project. But Suri, who is Kenyan, has been managing research teams in Africa since 2007 and has been studying the continent for a decade. “I think what’s happened over time in the slum that’s amazing is that our survey staff became known by the elders,” she said. “So over time, it’s gotten much safer for them because they’re known, the elders know them, and they’re in the community.”

Suri, whose work in sub-Saharan Africa covers issues in agriculture, household finance, and political participation, among other topics, hopes her findings will contribute to a body of research that can help direct policy in Africa.

“Ultimately, our goal is to improve welfare in some way in developing countries,” Suri said. “The idea is to create good, rigorous evidence on things that have a bearing on policy.”

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