There is widespread belief among development specialists that land tenure security is a necessary but not sufficient condition for economic development. Compared with weak or insufficient property rights, tenure security (1) increases credit use through greater incentives for investment, improved creditworthiness of projects, and enhanced collateral value of land; (2) increases land transactions, facilitating land transfers from less efficient to more efficient users by increasing the certainty of contracts and lowering enforcement costs; (3) reduces the incidence of land disputes through clearer definition and protection of rights; and (4) raises productivity through increased agricultural investment (Feder and Noronha 1987, Barrows and Roth 1990).
How tenure insecurity, separately and jointly with other obstacles, constrains agricultural performance is a crucial empirical issue in the economics of land policy and tenure conversion. The relationship is complex and multi-dimensional. This paper first defines tenure security then identifies potential linkages through development of a conceptual model for the crop and livestock sectors. Evidence is then presented from southern Africa to test these linkages and enrich the discussion of outcomes. The paper will conclude with observations on the quality and depth of this evidence, the necessity of looking at broader issues of market access and agrarian structure when evaluating agricultural performance, and finally, thoughts on appropriate tenure forms.
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The Broadening Access and Strengthening Input Market Systems (BASIS) Collaborative Research Support Program (CRSP) carries out and disseminates collaborative, policy-oriented research that addresses rural poverty by making markets work for all. The website hosts research reports, working papers, briefs and trip reports.