Land redevelopment under ambiguous property rights in transitional Vietnam: A case of spatial transformation in Hanoi city center

Abstract

Since the economic reform in 1986, there have been important changes in the institutions for land-use in Vietnam, which set the foundation for the transition from “land as a means of production” to “land as an assest”. Along with the gradual transition of land-use rights, a dual land market prevails as a result of the coexistence between marketization and centralization. In that system, the gap of land prices between market and non-market tracks has created landed interests that are embedded intricately within the resultant built environment, coupled with the rent-seeking behavior of SOE land holders and developers. Through the empirical case studies of the land redevelopment projects led by the state-owned enterprises in Hanoi’s city center, the study shows the hidden logic of spatial transformation and conflicts between the planning control under state’s ideology and land-rent seeking behavior in the reality. From the perspective of land rights, it is observed that state assets going through spontaneously “informal privatization” under ambiguous property rights has caused hasty redevelopment, leading to the development control mechanism not working properly. As a result, the externalities of un-controlled development are not internalized, causing over-compaction in the city’s center and lowers the environmental quality. This paper suggests that clarification of property rights should be the goal for further institutional change and of strengthening the state's capacity in development control.