Land market responses to economic recession in Kerala

Land is a key factor for any economic activity. Land market transactions play an important role in the process of economic transformation and development. Conventionally land is considered as a factor of production. However, it is increasingly becoming a speculative asset. It is in this context that this paper examines the impact of economic slowdown in land market. The study is carried out in the nine villages under the jurisdiction of the sub registrar Office, Badiadka of Kasaragod district in Kerala. Data on 967 land transactions were gathered. The trends in land market indicators like size of area, number of sales and price of land are subjected for a detailed analysis. The study also made a comparative analysis of the timing of economic recession in different sectors. Only in stock market the reflections of economic crisis was felt much earlier than any other sector. This may be because of the fact that stock market is interlinked to global economic conditions. Within the domestic sectors, economic recession has been visible in the land market earlier than other sectors. This was reflected in all the key variables that were examined in relation to land. This may be because of the fact that land market transactions involve huge amount of investments and a higher level of risk. A close watch at the movements in key variables such as number of sales, area transacted and land prices would therefore help along way in shaping right policies to ward off economic fluctuations.