NCPA - National Center for Policy Analysis

Russians In No Rush To Buy Private Property

March 27, 2001

Perhaps it's because for seven decades Russians were forbidden to own private land, but -- now that they are allowed to do so -- many are scared to make the move.

A rural area 500 miles from Moscow was the first region to adopt a land-ownership law after the new Russian constitution, adopted in 1993, guaranteed that "the right of private property shall be protected by law." But mere permission to buy and sell land has not turned out to be enough.

  • Without a viable banking and legal system, the vast majority of Russian farmers prefer to continue leasing land from the government at cheap prices -- wary that they won't be able to keep what they do buy.
  • Their fears may be justified, because old-school leftists who are still in power are resisting any changes which could transfer land to private hands -- which defeated former President Yeltsin's efforts to privatize rural lands.
  • President Vladimir Putin intends to unveil legislation which will reform the federal land code by May 1.
  • Then just last week, the State Dumas passed draft legislation explicitly allowing land sales for the first time -- but only after adopting an amendment excluding farmland sales.

Sales of urban lands are not as controversial as farm sales.

Without a workable land code, grain production has fallen by half since 1992.

Source: Peter Baker, "Experiment in Land Ownership Has Few Takers in Rural Russia," Washington Post, March 25, 2001.


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