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- Title
Is Just Compensation for Property Subject to Expropriation Equal to Its Market Value?
- Authors
Arumäe, Urmas; Kein, Alar
- Abstract
This article focuses on the issue of fair compensation in the process of expropriation of real properties and raises the question of whether compensation that is based on the market price can actually be considered fair compensation from the owner's perspective? The authors discuss the foundations for fair compensation in terms of economic theory, and demonstrate that the practice where the compensation for expropriated properties is based on market price does not generally guarantee compensation that is fair from the perspective of the owner of the property subject to expropriation by the government. Following a discussion of the foundations of fair compensation in economic theory, the authors formulate normative criteria for a compensation-related regulatory framework and, as an example, assess the respective regulatory framework in Estonia, de lege lata. The authors find that the principles of compensation applied in Estonia do not always meet the economic-theory-based normative criteria for just compensation. As such, the authors argue that current legal practices do not necessarily conform to the requirement for just compensation stipulated by the Constitution of the Republic of Estonia.
- Subjects
ESTONIA; JUST compensation (Eminent domain); MARKET value; CAPITALIZATION rate; PROPERTY; POSSESSION (Law)
- Publication
Journal of Management & Change, 2014, Vol 32/33, Issue 1/2, p12
- ISSN
2228-2181
- Publication type
Article