Land Matters. An Impact Evaluation in Developing Countries
Seventy-five percent of the world’s poor live in rural areas with a vast majority depending on agriculture. But all too often access to land is problematic and the legal status of land rights, especially of smallholder farmers, is unclear. Land reforms are therefore high on the international develop...
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|Summary:||Seventy-five percent of the world’s poor live in rural areas with a vast majority depending on agriculture. But all too often access to land is problematic and the legal status of land rights, especially of smallholder farmers, is unclear. Land reforms are therefore high on the international development agenda. However, empirical evidence is mixed, and some aspects, such as the effects of voluntary resettlement, are highly under-researched.
My dissertation therefore aims at contributing to the identification of consequences of voluntary resettlement. Thereby, I was guided by three central questions:
1. Did voluntary resettlement within a land reform affect social networks in the short run?
2. Do the land reform beneficiaries face the danger of a risk-induced poverty trap and does this threat differ between resettled and non-resettled participants?
3. How does the land distribution and initial agricultural success affect subjective economic well-being of the beneficiaries?
The data collection took place within a land reform project in Cambodia where so called social land concessions are granted to landless or land-poor households. Beneficiaries could apply for agricultural land, settlement land, or both types of land. This enabled me to compare those who received only agricultural land (non-resettled households) with those who received agricultural and settlement land (resettled households). The research is based on a data set consisting of ex-ante survey data on the socio-economic situation of future land recipients and an appropriate control group, ex-post survey data of the same households collected about one and a half year after the intervention, and ex-post experimental data of the land recipients dealing with risk-taking and the willingness to show solidarity with anonymous village members.
This dissertation shows that the willingness to support fellow villagers is significantly lower in the resettled community than in the non-resettled communities. Resettled land recipients transfer on average between 47 and 75 percent less money than non-resettled players. Hence, the social costs of voluntary resettlement seem to be significantly higher than commonly assumed. In line with this finding, solidarity expectations are lower for resettled than for non-resettled land recipients. As expectations are in turn positively related to risk-taking and the reaction to past success is stronger in the non-resettled community, I can show that the danger of path-dependency and a risk-induced poverty trap exists for all land recipients but that it seems to be higher for resettled project members.
As a complementary to these objective approaches, I analyze subjective economic well-being of the land recipients and a control group. I find that it is positively correlated with land size. This outcome does not only originate from monetary effects, as identified correlations remain significant after controlling for income. For that reason, it is likely that not only today’s income but also improved future economic prospects and increased economic stability play an important role for subjective economic well-being of land recipients. Moreover, those respondents who manage to put the received land under agricultural production show a higher subjective economic well-being indicating that success matters for farmers’ well-being.
This dissertation adds furthermore to the scarce evidence on causal effects of contract farming in the sphere of a large-scale land acquisition. Recently, large-scale land acquisition has increased dramatically in the developing world. The question how land deals affect the local population became therefore highly relevant. Despite controversial findings in the literature, studies identifying the causal effect of contract farming on farmers’ circumstances are rare and often rely on weak instruments. The fourth paper of this dissertation made use of a unique dataset incorporating information on outgrowers and independent farmers in the context of a large-scale land acquisition in Ghana where contract allocation took place as a quasi-natural experiment. The analysis was guided by the following question:
4. Does contract farming contribute to the overall subjective well-being of participating farmers?
We identify a positive effect of contract farming on subjective well-being. It seems that contract farming increases security of the participating farmers as secure rights to land matter substantially for the overall life satisfaction of non-contract but not of contract farmers.|