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Indigenous land rights in sub-Saharan Africa: Appropriation, security and investment demand

by Espen Sjaastad and Daniel W. Bromley1

Corresponding author:
Daniel W. Bromley, Anderson-Bascom Professor
Department of Agricultural Economics, 427 Lorch Street, University of Wisconsin Madison, WI 53706
E-mail: bromley@aae.wisc.edu


Posted with permission of Professor Daniel Bromley and Espen Sjaastad
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Espen Sjaastad and Daniel W. Bromley

We discuss the links between rights appropriation, tenure security, and investment demand in sub-Saharan Africa. Common assertions regarding indigenous tenure are: (1) insecurity of tenure leads to suboptimal investment incentives; and (2) appropriation of land rights in the public domain is rent-dissipating. We argue that land use and investment decisions among African farmers often have two motives - productivity and rights appropriation. The usual assertions thus seem contradictory. We offer a conceptual model to show that indigenous tenure may provide equal or higher investment incentives than private rights, and may promote modes of rights appropriation that are productive rather than wasteful.


Introduction

Many economists have argued that indigenous land rights in the Third World lead to inefficient resource allocation. Inefficiencies are thought to arise because indigenous land rights are ambiguous, are communal, and are afforded insufficient protection in legislatures - resulting in tenure insecurity which in turn leads to inferior investment incentives, undersupply of credit, and constraints on efficiency-enhancing market exchanges (see e.g. Dorner 1972, Johnson 1972, World Bank 1974). These arguments have been advanced as a justification for government action in land administration matters, and especially conversion to freehold titles in the Western strain. Recently, these views have been challenged on the grounds that: (1) indigenous land rights are often neither communal nor ambiguous; (2) indigenous tenures are flexible enough to cope with increasing land scarcity and to permit a gradual, "autonomous" individualization of rights, and; (3) state intervention in land matters often is more harmful than beneficial (Ault and Rutman 1979, Bates 1984, Bruce 1986 and 1993, LTC 1990, Migot-Adholla et al 1991, Bassett 1993, Platteau 1996). A recent empirical study by Besley adds to this literature in an important way. Besley writes that:

The results in this paper reinforce the need for careful empirical studies of land rights and investment in low-income environments. They also reinforce the importance of understanding the determinants of rights as well as their consequences. Given the importance of investment to long-term poverty alleviation, it is important to understand what, if anything, governments can do. Developing land rights is often offered as a feasible intervention, especially in Africa. It would be premature to say that this does not work. However, the analysis of this paper warns against viewing it as a panacea for problems of low growth and investment before the process determining the evolution of rights is properly understood (Besley 1995, p. 936).

In this paper we address the question of tenure security and its effects on investment demand as land becomes scarce and prices ?implicit or explicit) rise. The issues are discussed within the context of sub-Saharan Africa; specifically where land initially is abundant and shifting cultivation practices dominate, although the main points of this paper have application beyond this relatively narrow scope.

In the next section we briefly present how these issues have been viewed in mainstream property rights theory, as well as offer some common misgivings. In section three we describe how land rights and land use develop in a typical rural sub-Saharan African community as land becomes scarce. We also develop a conceptual model which compares investment incentives of indigenous tenure and freehold. In section four, we present a discussion of the central issues, and some concluding remarks.


Footnote:
  1. Espen Sjaastad is a research fellow at the Department of Forestry, Agricultural University of Norway, and a visiting fellow at the Department of Agricultural and Applied Economics, University of Wisconsin - Madison. Daniel W. Bromley is Anderson-Bascom Professor of Applied Economics and Chair, Department of Agricultural and Applied Economics, University of Wisconsin - Madison. The research was funded by the Norwegian Research Council. We would like to thank Ole Hofstad for his helpful comments.
 


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