Fractured Inheritance: Quantifying the Economic Impact of Heir’s Property on Arkansas Farmers

Abstract

Heir’s property arises when the original owner still holds the title despite their passing, and ownership is distributed among their heirs. This was driven by barriers to retaining land ownership and access to legal support in predominantly African American populations in the early 20th century. This approach allowed land to remain in the original owner\u27s name while granting continued ownership to future generations without formal paperwork. Additionally, allowing limited land access, land management, and disparities in capital access compared to property with direct ownership rights. This analysis examines how modern heir’s property impacts agricultural returns. This study develops a conceptual model to analyze heirs’ property policies in Arkansas, including a detailed budget analysis of conventional rice and heirloom tomato enterprises. Budgets are separated into a full single owner and heirs to represent a formal operation and an Heir’s Property operation. This comparison illustrates the profitability disparities based on the legal formality used in land ownership. We find that heterogeneity in farm profitability relates to farm scale, access to capital, and policy implications of heir’s property. These results provide continued evidence for policy changes in support of mitigating the limitations of heir’s property in agricultural production