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New Land Reforms And Their Impacts
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New Land Reforms And Their Impacts

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    New Land Reforms And Their Impacts New Land Reforms And Their Impacts Presentation Transcript

    • New Land Reforms and Their Impacts Stein Holden EfD-meeting Beijing Nov. 2008
    • Introduction
      • New land reforms high on the development agenda:
        • (High Level) Commission on Legal Empowerment of the Poor
        • The World Bank (scaled up financing of land reforms)
        • UNHABITAT (Global Land Tools Network)
        • MDGs: Rights based approaches
    • Fundamental characteristics of land
      • Spatially dispersed and immobile
      • Low maintenance requirement
      • Suitable as collateral
      • Essential resource for ag./food production
      • Divisible
      • No need for land markets unless there are imperfections in markets for non-land factors of production
    • Some of the issues
      • Are private property rights a preconditions for economic development?
        • de Soto, H. 2000. The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else .
        • de Soto vs. China vs. the current financial crisis
      • The relationship between financial markets and property markets/rights
        • The Achilles heel of the ”Western” economies
        • A source of economic growth and “bubbles” (boom and bust)
        • Distress sales and foreclosures during crises: What are appropriate policy responses?
      • Effects on and implications for developing countries?
        • Formalization of land rights for economic development/Land laws
        • How can land certification (or titling) be made more pro-poor?
        • How can redistributive land reforms be designed to succeed?
        • How can land reforms stimulate more sustainable land use?
    • The three neoclassical focal points of land reform
      • Tenure security
        • Enhance investment
      • Transferability
        • Gains from trade
        • Reallocate land to more efficient users
      • Credit access
        • Land as collateral
      • How important are each of these and are they always achievable?
    • ” New”(?) dimensions to land reform
      • Legal empowerment of the poor and women
        • MDGs:
          • Rights-based approaches
            • Land as a safety net for the poor
          • Focus on empowerment
          •  Focus on land reforms to achieve MDGs
          • Global Land Tools Network (UNHabitat)
          • CLEP
        • What new dimensions and new impacts become relevant to study?
    • The evaluation problem
      • A continuum or vector (”bundle”) of land rights
      • A vector of outcome or impact indicators
      • A set of conditioning factors
      • Baseline/Starting point conditions (counterfactual)
      • Logic of reform implementation
        • Crucial for identification of impacts
        • Can researchers influence it?
          • Randomized experiments the ideal but often not feasible
          • The toolkit for quantitative impact assessment has been improved substantially lately and is crying to be applied to these types of land reform problems
          • EfD may help to push this important research agenda!
            • New Book +++!?
            • Benefits from concerted action!
              • Visibility
              • Policy influence
    • Old and new land reform approaches
      • Classical land titling reform: Formalizing private property rights to land
        • Surveying and titling upon demand
        • High tech and high cost approach
      • Low-cost land registration and certification
        • Broad-based, large-scale implementation with strong local participation
        • Low-cost technology approach
        • Experimentation with alternative technology approaches
      • Removal of restrictions on land markets (restrictions on sales, duration of rental period, price or contract restrictions, area restrictions, outsider restrictions, approval restrictions)
      • Formalization of land markets (Rental markets vs. Sales markets)
      • Land redistribution policies and projects
        • Revolutionary reforms of the past
        • Regular redistributions to maintain an egalitarian land distribution (China, Ethiopia, Eritrea)
        • ” Market-assisted” redistributions in countries with inequitable land distributions (e.g. Brazil, Bolivia, South Africa, Zimbabwe, Malawi, The Philippines)
      • Formalization of customary land rights
        • Demarcation of village borders and village land use planning
        • Issuing of customary land certificates
        • Legal recognition of customary land rights
      • Legal empowerment of the poor/women
        • Conflict resolution systems
        • Joint certification of husbands and wives/rights upon divorce or death of spouse
        • Regulation of inheritance rights
      • Linking rights and obligations: Security of tenure conditional on proper land use
    • Formalization of land rights vs. Formalization of land transactions
      • Should legal empowerment processes aim to formalize all kinds of rights and transactions?
        • What is optimal level of formalization?
          • Benefit/cost perspective
        • Demand for formalization and distributional implications
      •  Focus on minimising transaction costs, local administrative capacity, enhancing transparency, enhancing tenure security, protecting the land rights of the poor
    • Benefits of formalization of land transactions
      • Legal support for conflict resolution
      • Prevent illegal transactions
      • Protection of poor and vulnerable groups against powerful contract partners
      • Ensure more sustainable management of the transacted land for contracts of limited duration
      • Provision of registry and national statistics on land transactions for policy analysis purposes, etc.
      • Tax base
      • Streamlined processes
    • Costs of formalization of land rental transactions
      • Costs of registration and making it ”complete”
        • Such costs can be high if all short-term rental contracts, including sharecropping contracts among neighbours and relatives are to be included
        • Capacity, capability and motivation of local administrations may be insufficient
      • Costs of ”formal” vs. ”informal” conflict resolution systems
      •  Formalize only transactions where there is a demand/need
    • Regulation of land markets?
      • Motives:
        • Create a level playing field
        • Protect the poor (land as a safety net)
      • Many failures in the past, e.g.,
        • Prohibition of sharecropping
        • Prohibition of land sales and rentals
          • “ Land to the tiller”
          • Distress sales and rentals  landlessness
          • Prevent migration to towns
        • Restrictions on duration of rental contracts
          • Effects on SLM?
        • Have not had the wanted/expected effects
        •  Regulations should be accompanied with careful research to assess the real impacts as these will be context-specific
    • What are the impacts of land reforms?
      • Types of impacts
        • Tenure security
          • Investments (e.g. conservation, tree planting)
          • Land management
          • Land conflicts
        • Transferability
          • Land market participation
          • Efficiency of land use
          • Mobility/migration (labor market)
          • Land values
          • Distributional implications (land, risk/safety net, income, welfare)
        • Credit access
          • Use of land as collateral
        • Legal empowerment
          • Poor and vulnerable groups
          • Welfare indicators
          • Empowerment indicators
    • Why have many land reforms failed?
      • Land titling in Kenya and Madagascar
        • Have not enhanced tenure security, promoted investment, land and credit markets (e.g. Place and Migot-Adholla 1998, Jacoby and Minten 2006,2008)
      • Land distributions remain extremely skewed after many years with land redistribution reforms in Latin-American countries, South Africa, Zimbabwe, …
    • Why have many land reforms failed in Latin America?
      • Emphasis on collective ownership and management after the reform
        • Naïve belief in advantages of collective management among radical groups? Collective management has in most cases failed in agricultural production (Eastern Europe, China, Africa, LA)
      • Modernization of large farms was used as a requirement not to lose the land
        • Naïve belief in economies of scale? Limited EOS in tropical agriculture
      • Large farms were favored in allocation of (subsidized) credit in relation to the modernization, eliminating advantages from small scale production
      • Successful small scale production requires more than land (knowledge, skills, access to credit and other markets, infrastructure)
        • Many types of investments are necessary and it takes time before benefits come
      • Naïve belief that establishment of private property rights is sufficient for the credit market to start to function well
      • Big land owners have allied themselves with those in power
        • Democracies have also failed to achieve large land redistributions
    • Examples of successful land reforms
      • Ethiopia
        • Low-cost land registration and certification
      • China
        • Household responsibility system
      • Mexico
        • Constitutional reform
      • India
        • Computerized registry system, tax-base
    • Successful land reform in Ethiopia
      • Land certificates have been provided to more than 6 million households and for more than 20 million plots of land within a period of 8 years
      • Land certification has enhanced
        • Tenure security, especially of women
        • Land rental market participation
        • Land investments
        • Land productivity
        • And reduced land conflicts
        • (Deininger et al. 2008, Holden et al. 2008a, 2008b, in press, Holden and Tefera 2008, Ghebru and Holden 2008). The studies can be obtained from [email_address] upon request.
    • Land rental market participation in 2003: Distribution of net land leased in by own farm size
    • Yield distribution, plots with and without land certificate
    • Conflict mediators’ perceptions of border disputes before and after land certification, Southern Ethiopia (Holden and Tefera 2008)
    • Why has the Ethiopian land reform been so successful?
      • It has not provided full private property rights to land
      • It has not opened for sales markets for land
      • It has not opened for mortgaging of land
      • It has not used advanced technology or highly skilled technical staff during implementation (except in pilot areas)
    • Reasons for the success of the Ethiopian land reform
      • Initial tenure insecurity created a demand for certificates that could enhance tenure security
      • A low-cost (affordable) & scalable approach
      • Committed land administrations
      • Strong local participation in implementation
      • Local institutional structures in place
      • Not in conflict with the interests of a powerful elite
    • Lessons from Ethiopia og China
      • Radical reforms contributed to an egalitarian land distribution but this alone did not create growth and development
        • Big landowners were eliminated without compensation and did not get positions in local administrations
        • Collective management failed
      • The land tenure system is similar in the two countries
        • All land is owned by the state (collective)
        • Households have user rights
        • Strong emphasis on equity in the distribution of land within communities
        • Each household has a proportion of each land quality class.
      • Frequent land redistributions maintained an egalitarian distribution but created tenure insecurity and undermined investment incentives
        • Land certification appears to be a good remedy for this problem
      • Strong population growth, conflicts and lack of technological progress contributed to stagnation and continued poverty in Ethiopia
        • Land fragmentation and very small farm sizes
        • Increasing landlessness: Difficulty of finding land for the young generation
    • New Challenges in Africa
      • New demands for land for biofuel production
        • But how will it be affected by the financial crisis and fall in energy prices?
      •  Rapid commercialisation of land markets/risk of land grabbing
        • Legal empowerment processes may lag behind and poor may lose out and become landless
        • Unequal bargaining power and asymmetric information cause a need for special efforts to protect the land rights of the poor
        • A clear need to formalise these types of land transactions and enhance transparency to reduce risk of parties and to ensure more fair contracts
    • New Challenges in Africa
      • Emerging landlessness in the most densely populated areas
        • Eroding the potential of land as a safety net
      • Higher food and energy prices increase the poverty gap
      • Provision of ladders out of poverty:
        • Legal empowerment, important but not enough
        • New technologies and investments that can enhance land productivity
        • Exit options: Expanding the non-farm economy
        • Alternative safety nets: Mobilize abundant labour for productive investments
    • Conclusion
      • Land reforms are again high on the policy agenda
        • A need for a more pragmatic and less ideological approach
      • Land markets are becoming more important many places
        • It is better to facilitate their development to the benefit of the poor than to suppress them
        • Especially land rental markets can facilitate land access for landless and land-poor households and be a safety net for poor landed households that can benefit from renting out their land to more productive farmers
        • But how can sustainable land management be enhanced on rented land?
          • Longer duration contracts?
          • Renewable contracts depending on performance?
      • Formalization of land markets may be particularly relevant where demands have increased sharply for production of biofuels
      • Here is a rich research agenda for environmental and development economists