Surrendering the environment for capital gain and Olson’s group theory: A case study of the dissolution of housing co-operative societies in Hong Kong
This paper describes the rise of cooperative housing for civil servants and its fall during the transition of Hong Kong from a British colony to a special administrative region of the People’s Republic of China. Olson’s group theory was adopted to explain the timing of the dissolution in a context of uncertainty in the property rights of land; the terms of civil service appointments; and the housing market.
The ownership body’s size and the land’s value were evaluated as factors affecting dissolution decisions. In agreement with Olson’s theory, the number of body members had a statistically significant positive relationship with the life (between formation and dissolution) of the cooperative body. In addition, it was also found that factors that affected the opportunity cost of maintaining the status quo, including the value of the land on which the coop scheme sits and the real option value of redevelopment, had a significant impact on the timing of the dissolution of the coop. The implications of using Olson’s theory are also discussed.
Authors: Lawrence Wai Chung Lai*, Kong Wing Chau, Jason Wai Yin Kwong
Department of Real Estate and Construction, University of Hong Kong, Pokfulam Road, Hong Kong
Habitat International journal homepage: www.elsevier.com/locate/habitatint
Habitat International 36 (2012) 261-267
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