LAND POLICY AND REFROM

Training Module for Bachelor Program Students in

Land Administration and Surveying

Achamyeleh Gashu (PhD)

Institute of Land Administration
Bahir Dar University, 2015
Land Policy and Reform
(Laad462)

Training Module for BSc. Program Students in

Land Administration

By: Achamyeleh Gashu (PhD), Associate Professor

Institute of Land Administration

Bahir Dar University, 2015
Table of Contents
TABLES ........................................................................................................................................................ V

FIGURES ...................................................................................................................................................... V
COURSE INTRODUCTION .....................................................................................................................................6
COURSE OBJECTIVES............................................................................................................................................7
UNIT 1: INTRODUCTION TO LAND POLICY AND REFORM ............................................................ 8
1.1. BASIC CONCEPTS OF LAND POLICY ...................................................................................................................8
1.2. BASIC CONCEPTS OF LAND REFORM ..............................................................................................................10
1.3. OBJECTIVE AND ELEMENTS OF LAND REFORM .......................................................................................................12
1.4. STAKEHOLDERS IN THE PROCESS OF LAND REFORM AND THEIR ROLE ...........................................................................15
1.4.1. The Role Disinterested Outside Observers..........................................................................................16
1.4.2. The Role State and Government Agencies .........................................................................................17
1.4.3. Interested Parties ................................................................................................................................18
1.4.4. The Role of Development Aid Agencies and Donors ..........................................................................19
1.5. POTENTIAL BENEFITS OF LAND REFORM ...............................................................................................................21
UNIT 2: BASIC CONCEPTS OF LAND AND LAND RIGHTS ..............................................................26
2.1. DEFINITION OF LAND FROM DIFFERENT PERSPECTIVES ............................................................................................26
2.2. PROPERTY RIGHTS AND PROPERTY RIGHTS SYSTEMS ...............................................................................................29
2.2.1. Property Right .....................................................................................................................................29
2.2.2. Property Right System/Regime...........................................................................................................33
UNIT3: APPROACHES TO LAND REFORM ........................................................................................36
3.1. INTRODUCTION ...............................................................................................................................................36
3.2. STATE-LED (POLITICAL ECONOMY) APPROACHES TO LAND REFORM ............................................................................38
3.2.1. Criticism and Limitations Of State-Led Land Reforms ........................................................................40
3.3. MARKET DRIVEN (NEO-LIBERAL) APPROACHES TO LAND REFORM.............................................................................42
3.4. ACTOR-ORIENTED APPROACHES: A FOCUS ON PEOPLE .............................................................................................45
3.5. THE PROCESS OF DESIGNING LAND REFORM ..........................................................................................................47
3.5.1 Analysis of Policy, Legal and Institutional Framework .......................................................................48
3.5.2. Analysis of Opportunities for Changes in Land Reform......................................................................50
3.5.3. Analysis of Sustainability of Land Reform ..........................................................................................51
3.5.4. Analysis of Social Impact of the New Land Reform Policy ................................................................51
3.6. MONITORING AND EVALUATION INDICATORS ........................................................................................................52
3.6.1. Tenure Security Indicators...................................................................................................................52
3.6.2. Land Market Indicators .......................................................................................................................52
3.6.3. Environmental Impact and Natural Resources ...................................................................................53
3.6.4. Regulatory Framework Indictors ........................................................................................................53
UNIT 4: REDISTRIBUTIVE LAND REFORM ......................................................................................55
4.1. BASIC CONCEPTS OF REDISTRIBUTIVE LAND REFORM ..............................................................................................55
4.2. NATURE AND EXTENT OF REDISTRIBUTIVE LAND REFORM ........................................................................................57
4.3. REDISTRIBUTIVE LAND REFORM ON PUBLIC AND PRIVATE LANDS ................................................................................59
4.3.1. Views of Redistributive Land Reform on Public Land .........................................................................59
4.3.2. Redistributive Land Reform on Private Lands ....................................................................................60
 4.4. FUNCTIONS OF REDISTRIBUTIVE LAND REFORM .................................................................................................... 61
4.4.1. Redistributive Land Reform and Poverty Reduction.......................................................................... 62
4.5.2. Redistributive Land Reform and Productivity .................................................................................... 63
4.5.3. Redistributive Land Reform and Economic Development ................................................................. 63
4.5.4. Redistributive Land Reform and the Environment ............................................................................ 64
UNIT 5: LAND RESTITUTION .............................................................................................................. 67
5.1. BASIC CONCEPTS OF LAND RESTITUTION ............................................................................................................. 67
5.2. DRIVING FORCES OF RESTITUTION ...................................................................................................................... 69
5.3. LAND RESTITUTION INSTRUMENTS ..................................................................................................................... 73
UNIT 6: LAND CONSOLIDATION AND READJUSTMENT ................................................................ 75
6.1. BASIC CONCEPTS OF LAND CONSOLIDATION ......................................................................................................... 75
6.2. LAND FRAGMENTATION: RATIONALE FOR LAND CONSOLIDATION ............................................................................. 76
6.2.1. Causes and Problems of Fragmentation ............................................................................................ 76
6.2.2. Benefits of Fragmentation ................................................................................................................. 78
6.3. THE ROLE OF LAND CONSOLIDATION FOR RURAL DEVELOPMENT................................................................................ 78
6.4. APPROACHES TO LAND CONSOLIDATION.............................................................................................................. 80
6.4.1. Comprehensive Land Consolidation ................................................................................................... 81
6.4.2. Simplified Land Consolidation ............................................................................................................ 81
6.4.3. Voluntary Group Consolidation.......................................................................................................... 82
6.4.4. Voluntary Individual Consolidation ................................................................................................... 82
6.5. LAND CONSOLIDATION PROCEDURES .................................................................................................................. 82
6.6. URBAN LAND CONSOLIDATION/READJUSTMENT ................................................................................................... 85
6.7. LAND READJUSTMENT PROCESS: FROM COUNTRY EXPERIENCES .............................................................................. 89
UNIT 7: LAND REFORM MEASURES IN ETHIOPIA .......................................................................... 94
7.1. INTRODUCTION .............................................................................................................................................. 94
7.2. THE IMPERIAL LAND TENURE SYSTEM - BEFORE 1975............................................................................................ 95
7.2.1. Rist Tenure .......................................................................................................................................... 95
7.2.2. Gult and Rist-Gult ............................................................................................................................... 96
7.2.3. Gebbar System.................................................................................................................................... 97
7.3. THE 1975 RURAL AND URBAN LAND REFORM ..................................................................................................... 98
7.3.1. The 1975 Rural Land Reform .............................................................................................................. 98
7.3.2. The 1975 Urban Land Reform .......................................................................................................... 102
7.4. THE CURRENT LAND TENURE POLICY OF ETHIOPIA .............................................................................................. 103
7.4.1. Introduction ...................................................................................................................................... 103
7.4.2. Dichotomized Views on State Ownership of Land ........................................................................... 104
7.4.3. Rural Land Tenure ............................................................................................................................ 107
7.4.4. Urban Land Tenure ........................................................................................................................... 109
7.4.5. Patterns of Land Rights in the Peri-urban Areas ............................................................................... 111
REFERENCE LISTS...................................................................................................................................... 115
Tables
Table 1: Bundle of rights and right holders ................................................................................. 31
Table 2: Key features of state-led and market-led approaches of land reform .................... 44
Table 3: Advantages and benefits of LR as compared to expropriation .............................. 87
Table 4: Summary of land readjustment features based on country experiences ................ 89
Table 5: Rural land holding rights and landholder's position in Ethiopia ........................... 108
Table 6: Urban leasehold rights and leaseholder's position in Ethiopia .............................. 111

Figures
Figure 1: Land rights below, on and above the ground ............................................................... 28
Figure 2: Property rights as a link between man and land ........................................................... 30
Figure 3: Property structure before and after land readjustment ................................................ 86
Figure 4: Three pillars of sustainable development addressed by LR ................................... 88
Figure 5: Property structure after LR with infrastructure ......................................................... 91
Figure 6: The two land holding arrangements in Ethiopia ..................................................... 104
Figure 7: Patterns of land re-assignment in the peri-urban areas of Ethiopia .................... 112
Laad 462 - Land Policy and Reform

COURSE INTRODUCTION
Dear Student! Welcome to the course Land Policy and Reform (Laad-462). This course is
designed to introduce you with the contemporary concepts of land policy and reform based
on both from global experiences and Ethiopian context. The course is designed for BSc land
administration program students.

Land policy is about the decisions and actions of policymakers with regard to the use of land.
Some of the principal questions that need answer in land policy include: Does land policy
promote soil fertility? Or the beautiful fields and forests in spring time? Or the protection of
property rights? Or generous urban public spaces? Or well-crafted real estate investment
trusts? Or does land policy support land as a barrier against our neighbors? While land
reform is a governmental measure or deliberate change in land tenure or in a way land is held
to effect a more equitable distribution of land and land development benefit. Land represents
the principal form of wealth and the main source of economic and political power all over the
world. Land can be seen as a vehicle for sustainable development. Widespread inequality in
the control of land constitutes a principal obstacle to development in many developing
countries. Therefore, justified land reform is assumed to provide secure and equitable rights
to productive land for all and it should clearly be a high priority of states and other actors
committed to the pursuit of socially and ecologically sustainable development. Hence, land
reform in general implies the redistribution of property rights in land for the benefit of the
landless in the society.

The preparation of this module is primarily aimed to fill the reference materials gap faced
by the distance students of land administration in Bahir Dar University in the Institute of
Land Administration.

This module is composed of seven interrelated chapters. The first chapter of the text book
introduces basic concepts of land policy and land reform. This chapter mainly focuses on
developing an understanding on the basic issues of land policy and reform. It also
describes the objectives and principles of land reform. The second chapter deals with land
and land right issues. The contents of land rights and property rights regimes are also
elaborated in this chapter. The third chapter outlines the approaches to land reform. The
major types of land reform such as redistributive land reform, land restitution and land
consolidation/readjustment are explained in detail with practical examples in the fourth,
fifth and sixth chapters respectively. Finally, the seventh chapter provides an insight on
the land reform measures undertaken in different regimes of Ethiopia.
COURSE OBJECTIVES
At the end of this course you will be able to:
 Understand the basic concepts of land policy and reform
 Become familiar with the central issues of land reform programs;
 Compare and contrast the different approaches of land reform;
 Recognize the major issues related to land redistribution;
 Comprehend the basic concepts of land Restitution;
 Become familiar with basic concepts, approaches and strategies of Land
Consolidation;
 Appreciate the important aspects of land consolidation;
 Understand the importance of land readjustment as a land reform measure;
 Evaluate land reform measures undertaken in Ethiopia in different times.

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Laad 462 - Land Policy and Reform

UNIT 1: INTRODUCTION TO LAND POLICY AND REFORM

UNIT OVERVIEW

Dear Student: In the first unit of this course you will be introduced with the basic
concepts of land policy and reform. The unit discusses the purposes of land reform and list
out major elements of land reform. This unit also focuses on describing the role of different
stakeholders in the process of land reform. The potential benefits of land reform are also
explained in this unit.

UNIT OBJECTIVES

After completion of this unit, you are expected to:

 Understand the basic concepts of land policy and reform;

 Describe the purpose of land reform;

 List out elements of land reform;

 Understand the role of different stakeholders in the process of land reform;

1.1. Basic concepts of Land policy

Dear Student! In the first section of this course you will be acquainted with the basic
concepts of land policy. Objectives as well as principles of land use planning will also be part
of this section. Please try to write your own answer for the following question in your own
words in the space provided below:

What does land policy mean for you?

__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
Have you tried it? Very good! Please, try to relate the concept of your answers with the
following analysis.

The traditional starting point for defining land policy is that land policy comprises decisions
taken by those with responsibility for land issues, and these decisions usually take the form
of statements or formal positions on land issue, which are then executed by the bureaucracy.
Therefore, land policy is about the decisions and actions of policymakers with regard to the
use of land. The phrase ―uses of land‖ implies that land is useful. But useful how? Does land
policy promote soil fertility? Or the beautiful fields and forests in springtime? Or the
protection of property rights? Or generous urban public spaces? Or well-crafted real estate
investment trusts? Or does land policy support land as a barrier against our neighbors?
Depending on the land uses we have in mind, land is useful—and valuable—in different
ways. Land has numerous meanings.

Land is not just the soil of the Earth. Land is a social construction. This construction helps
stakeholders imagine land in widely different fashions. A government agency, for example,
often considers land as a territory and space of power. A real estate developer may consider
the same piece of land as a commodity and space of economic exchange and development. A
farmer considers the land as source of her livelihood, as her home, and place of identity.
Moreover, social constructions of land as environment also emphasize the moral perspectives
of existence. In order to be successful, land policy has to respond to these different voices,
different rationalities.

Land policy is concerned with the efficient allocation of land uses: Each plot of land should
be employed to its best use. However, land policy also considers the just distribution of the
benefits and burdens of land uses: The profits and the cost of land uses should be distributed
in a way conforming with the prevalent standard of justice.
Typical examples of land policy include
 a country‘s system of land cadastres and land registers;
 legislation on private and common property relations;
 regulatory control of land uses through spatial planning and environmental law;
 permit requirements with respect to building houses or sitting hazardous facilities;
 land taxes;
 interventions with regard to housing, farming, and other land uses;
 collective action with regard to natural resource management;
 a land reform.

9
Laad 462 - Land Policy and Reform

Thus, in practice, policy in general and land policy in particular is notoriously difficult to
define. As it is described in most literatures: ‗Policy is rather like the elephant: you know it
when you see it but you cannot easily define it.‘ Rather than seeing policy as simply a single
decision implemented in a linear fashion, many observers have noted that policies generally
consist of a broad course of action. It is also a web of interrelated political decisions that
evolve over time during the process of implementation. It includes different legislations,
working documents, and different political decisions related to land. For instance in the
Ethiopian case; FDRE Constitution , proclamations, directives and other documents and
decisions related to land are part of land policy. Moreover, policy also needs to be seen as an
inherently political process, rather than simply the instrumental execution of rational
decisions.

1.2. Basic Concepts of Land Reform

Dear student! In this sub-section you will be introduced with the basic concepts of
land reform. Driving factors for land reform will also be discussed below. Have you read
about land reform before? If yes write your understanding about land reform in the space
provided below:
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________

Have you tried to answer the above question? Very good! Please, try to relate your answers
with the following analysis.

Land is one of the most valuable natural resources of a country. It represents the principal
form of wealth and the main source of economic and political power. Land can be seen as a
vehicle for sustainable development. Widespread inequality in the control of land constitutes
a principal obstacle to development in many developing countries1. Therefore, justified land
reform is assumed to provide secure and equitable rights to productive land for all and it
should clearly be a high priority of states and other actors committed to the pursuit of

1
BARRACLOUGH, S. L. 1999. Land Reform in Developing Countries : The Role of the state and other
actors. United Nations Research Institute for Social Development, Discussion Paper No. 101, June 1999
socially and ecologically sustainable development. Land tenure institutions have a direct
bearing on questions of development and help to shape the pattern of income distribution2.

Land reform, according to Webster‘s dictionary, means governmental measures designed to

effect a more equitable distribution of land. It implies the redistribution of property rights or
land for the benefit of the landless peasant, small farmers and tenants. Some other definitions
provided by scholars are also stated below. Of these the most commonly used definitions are
the following:

i. Land reform is a sweeping change in land tenure. It usually involves the

breaking-up of large estates and the widespread redistribution of the
land into smallholdings, but may also be land restitution and land
consolidation3.

ii. Land reform is a deliberate change in the way land is held or owned, the
methods of its cultivation, or the relation of agriculture to the rest of the
economy. The most common political objective of land reform is to
abolish feudal or colonial forms of landownership, often by taking land
away from large landowners and redistributing it to landless peasants.
Other goals include improving social status of peasants and
coordinating agricultural production with industrialization programs4 .

iii. To over-simplify, land reform are laws which intended and likely to cut
poverty by substantially increasing the proportion of farmland controlled
by the poor, and thereby their income, power or status5.

According to the above definitions of land reform, all of them appear to share three principal
elements. These are:
a) Land reform is invariably a more or less direct, publicly controlled change of the
existing man-to-land relationship (land tenure);
b) The change normally attempts a diffusion of wealth, income or productive capacity
throughout the society.
c) The motives for land reform are political, social and economic simultaneously or
separately.

2
ZARIN, H. A. 1994. Theory On Land Reform: An Overview. Bolelln Ukur, Vol. 5. No.1, pp 9-14.
3
http://www.merriam-webster.com/dictionary/land%20reform
4
Ibid
5
LIPTON, M. 2009. Land Reform in Developing Countries : Property rights and property wrongs, New York,
Routledge.

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Laad 462 - Land Policy and Reform

The political motives are often considered as the last resort but the most decisive. It is the
balance of political power in a country which ultimately determines the extent of a reform,
and the political factors help to explain the frequencies and discrepancies between the
provisions of a reform law and their eventual practical effects. Many governments use land
reform, or the promise of it, to gain or retain power6. The social motives is basically
concerned on social equality or social justice, while the economic motives are based on the
issue of efficiency. The last two motives are never separated and sometimes regarded as the
fulfillment of one objective may help to achieve or retard another. However, recent literature
on land reform stress that economic and social goals need not conflict. Indeed, they must be
seen to be welded together in the land reform approach to development in general.

The demand for greater equality or social justice is the principal motive for execution of land
reform in any society. Besides, land reform is an important tool to fight poverty7. Therefore,
changing and restructuring of the existing laws, rules and procedures should part of an
attempt to make the land tenure systems consistent with the overall requirements of
economic development and poverty reduction. Moreover, land reform pertains to the
remodeling of tenure rights and the redistribution of land, in directions consistent with the
political imperatives underlying the reform. All the efforts of implementation have to be
made within the existing political and administrative framework.

1.3. Objective and Elements of Land Reform

Dear student! This sub-section deals with the objectives and elements of land reform. What
do you think is the objective of land reform? If yes write your understanding about land
reform in the space provided below:
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________

Have you tried to answer the above question? Very good! Please, try to relate your answers
with the following analysis.

6
ZARIN, H. A. 1994. Theory On Land Reform: An Overview. Bolelln Ukur, Vol. 5. No.1, pp 9-14.
7
LIPTON, M. 2009. Land Reform in Developing Countries : Property rights and property wrongs, New York,
Routledge.
In its broadest sense, land policy reform can involve deliberate changes to the institutions of
land resources or the forms of tenure under which they are held, the rules regulating land use,
and the institutions which administer and manage land.8 However due to differences in
property right regime, farming methods, the history of land acquisition, general social and
economic conditions and political aims and differences, the processes and types of land
reform measures differ widely from one country to the other. But all land reform measures
have some common trends and objectives and intended to remedy one of the following
deficits.

 A desire to correct historical inequities or inefficiencies;

 The withdrawal of tight state control over land and establishment of individual or
family property rights;
 The need to provide more secure rights for women and other vulnerable groups using
an approach based on pragmatism rather than ideology, and
 Recognition and/or restitution of native titles or previous rights.

The agenda for land reform has become more diverse over the last two decades. It is no
longer confined to redistributive reform, that is, the transfer of land rights from large
landowners to landless people, tenants, and smallholders by way of direct state action.
Today, the term ‗‗land reform‖ is commonly used to refer to redistribution and resettlement
programs on publicly owned land, land registration, consolidation of fragmented holdings,
tenancy improvement, and land taxation in addition to redistribution.9 This broad definition
reflects the recognition that access to land is constrained in multiple ways, and that states
have a wide variety of legal and administrative instruments at their disposal in order to
enhance the land rights of disadvantaged groups.

Since the beginning of 20th century, different countries have undertaken different types of
measures so as to attain fair and equitable distribution of wealth to the people at large and the
other objectives stated above. Therefore, the specific measures and actions of states
depending on the context of the country may include one or several of the following
elements:10
 Land redistribution and creation of new opportunities for land access;
 Designing and enacting new tenure legislation and revision of codes, to recognize
and regulate new types of rights or forms of transfer (including women‘s, small
farmers‘, pastoralists‘, minority groups or indigenous peoples‘ land rights);
 Land registration and titling of existing rights;

8
Ibid.
9
SIKOR, T. & MÜLLER, D. 2009. The Limits of State-Led Land Reform: An Introduction. World Development Vol.
37, No. 8, pp.1307–1316.
10
Ibid.

13
Laad 462 - Land Policy and Reform

 Regularization (updating formal records to take account of changes and informal

transactions) of existing land rights;
 Restitution of land rights taken from the original owners or users;
 Privatization of collective or state land;
 Improvements to the efficiency and accountability of existing land administration
systems; establishment of (new) institutions and structures with responsibility for
land acquisition, administration and conflict resolution; and
 Setting up a land-based tax system

Therefore, specific lists of measures stated as elements of land reform can be summarized
and categorized into four types/forms of land reform.11 These are:
a. Land Tenure Reform: this type of reform involves changes in land tenure
system or it is a change in the manner in which land rights are held. Example
abolishing traditional and customary rights and introducing more simple and
streamlined mechanisms of land transfer; or converting public property
system into private property system.

b. Redistribution of Land Rights: it consist of the redistribution of land rights

from one sector to another. It usually refers to taking of land from the State or
from individual owners of large estates and giving it to people who have no
land.

c. Land Restitution: may involve the restoration of land rights to previous

owners. This usually occurred in countries in transition when former private
rights in land were taken previously. Central and eastern Europe, South Africa
and Zimbabwe are some examples where restitution took place.

d. Land Consolidation: is a type land reform by which all landowners within an

area surrender their land and are allocated new parcels of comparable value
but in a pattern that encourages the more efficient and productive use of the
land.

Activity 1.1
1. What is land policy?
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11
BHATTA, G. P. 2010. Assessing Land Reform Approaches to Benefit Socially and Economically Disadvantaged
(SED) People. ITC, The Netherlands.
 2. What is land reform? Discuss about the types of land reform.
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3. Discuss about the objectives/purpose of land reform?

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4. What is the difference between land policy and reform?
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Dear Student! Have you answered the above questions? If your answer is no, please reread
this section and try to answer those questions again. If your answer is yes, very good, go to
the next section.

1.4. Stakeholders in the process of land reform and their role

Dear Student! In this section you will be introduced with the principal stakeholders in
the process of land reform. Please try to list out some of the principal stakeholders interested
in the process of land reform in the space provided below.
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Have you tried to answer the above question? If your answer is no, please try to discuss
with your friends. If your answer is yes, write your answer on a rough paper and try to
relate it with the following explanation.

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Laad 462 - Land Policy and Reform

An approach to sustainable and equitable development requires well informed, purposeful

courses of action by the state and other concerned social actors.12 Land tenure institutions
have to be continually adapted and regulated to serve the great majority. But unless the
institutions and policies regulating rights and obligations in access to land are somehow
made primarily accountable to poor majorities, to low-income minorities and unborn
generations instead of to currently dominant corporate and other powerful groups-public
interest can easily be interpreted to mean the opposite of sustainable development. Therefore
a sustainable type of land reform requires the interaction and participation of different groups
of society.

Given the current socio-economic context both in urban and rural areas, and the diversity of
people and interests, policy should aim to provide a broad set of solutions, which can be
tailored to the needs of different stakeholders and local circumstances. It is government‘s
responsibility to provide a system of land administration which is accountable, transparent
and cost-effective, and responds to the diverse needs and characteristics of the population.
The system of administration needs to be especially oriented towards ensuring that the rights
of poorer and less powerful groups are respected and confirmed since it is these groups
which usually suffer during periods of growing land scarcity and land registration if land
distribution is left to market forces alone.

According to (Lipton, 2009)13, four different groups of people are interested in the process of
land reform with different objective, actions and influences. These are:
i. Disinterested outside observers;
ii. Members and officials of governments and their agencies;
iii. People with direct or indirect interests in the amount and terms of land transfer; and
iv. Development aid agencies and Donors

All actors interested in land reform have different ways of influencing in the process of land
reform. For example, outsiders publish and persuade. Governments legislate and implement.
Interested parties mobilize and lobby, threaten or boycott and strike.

1.4.1. The Role Disinterested Outside Observers

Disinterested outside observers (outsiders) comprise those academics, policy analysts,
journalists, etc. who seek, or are paid, to tell things as they are. Sometimes outsiders are
incompetent or prejudiced: they are no more angelic than anyone else. But their rewards,
professional rules, or preferences normally lead them to analyze, and if appropriate support
or oppose, a land reform on grounds of what they believe is its impact on well-being.
12
BARRACLOUGH, S. L. 1999. Land Reform in Developing Countries : The Role of the state and other actors.
United Nations Research Institute for Social Development, Discussion Paper No. 101, June 1999
13
LIPTON, M. 2009. Land Reform in Developing Countries : Property rights and property wrongs, New York,
Routledge.
Their concern is with the likely effects, in their view, of the reform on the following goals:
income, status or power for the poor; fewer gross or unearned inequalities; growth;
sustainability; and stability. Their procedure is to explore those effects; (sometimes) to
consult people affected by the reform. Ideally outsiders do consult, and their findings depend
on evidence and analysis based on law, economics, other social sciences, agronomy or moral
philosophy, rather than on hunch, prejudice or anecdote.

1.4.2. The Role State and Government Agencies

The role of the state in land reform is crucial. This is because the state comprises the
institutionalized political organization of society. It articulates and implements public policy,
and adjudicates conflicts.14 In theory, the state has a monopoly over the legitimate use of
coercive force within its territory, together with the responsibility to pursue public good for
all its citizens. Land reform without the state‘s participation would be a contradiction of
terms. But how does the state participate? To what avail? To whose advantage or detriment?
But answers to these questions are quite different for each time and place. They are context
dependent.

Land and property rights constitute a plank of central importance in the construction of good
governance for any government. Therefore, government is responsible to ensure fair and
secure distribution of land rights. Government is responsible to draw up policies, and
establish legislations, structures and procedures for the protection of rights in property for all
the population, as well as civil rights more generally. But the property rights protected by the
State should not result in the exclusion of people from access to basic needs and rights. The
Constitution of the country sets out the distribution of power between different branches of
government, the safeguards and appeals against abuse of power, provisions to maintain
accountability and representation through regular elections at national and local levels, and
the fundamental principles governing relations between citizens and state.

Despite the wide variation in the objectives, circumstances and conduct of land reform and
the dimensions of land (economic, social and political), the role and intervention of the state
is central to the success of land reform. The principal types of interventions and roles by the
state are stated below:

i. Land Tenure Reform: designed to adjust or correct the reciprocal property rights
between proprietors, in response to changing economic needs (e.g. the establishment
of statutory committees or land boards to organize and supervise the use of common
rights and other interests; the conversion of more informal tenancy into formal

14
Ibid.

17
Laad 462 - Land Policy and Reform

property rights; tenancy reform to adjust the terms of contract between landlord and
tenant.

ii. External Inducements: are 'market-based' incentives offered by government for

social and economic reasons and leading to the restructuring of existing property
rights or the creation of new ones, e.g. the distribution of public lands; state
expenditure on land reclamation and subsequent allotment as private property; state
sponsored credits channeled by a land bank through cooperatives; support to
institutions to administer the necessary land acquisition and distribution mechanisms.

iii. External Controls:- or prohibitions imposed by law on property rights (i.e. non-
market measures), for instance: nationalization and collectivization; restitution;
redistribution policies involving expropriation of land (with or without compensation)
on grounds of excessive size, under-utilization, ownership by absentee landlords
and/or foreigners. By contrast, gradual redistribution policies operate e.g. through
death duties. Other external controls can act against redistribution, e.g. laws
preventing land fragmentation below certain minima.

iv. Confirmation of Title: to verify and secure land titles to those who have already a
demonstrable claim reduces doubt and contention and so sets for the foundations for
development.

1.4.3. Interested Parties

A wide range of people are directly or indirectly interested to land and land reform.
Interested parties gain or lose from a land reform directly and indirectly.15 Directly affected
are those among whom land rights are transferred. For example in classic land reform, big
farmers, and small farmers or workers who receive land; in de-collectivization, State and
collective farm managers and those who receive land; in tenancy reform, landlords and
tenants. All these seek more land for themselves or their community, or more compensation
for lost land. Sometimes, they use the reform to try and improve the legal or customary terms
on which they relate to other land users: workers, owners, tenants.

Indirectly affected are those groups of the society who neither gain nor lose land from the
ongoing land reform, but whose employment or wage-rates change due to land reform. These
groups also include consumers, especially the poorer urban and rural non-farmers, if land
reform affects the levels (or fluctuations) in prices or availability of farm products, especially
for the main staple food.

15
Ibid.
Therefore, governments need to engage with all interested parties to benefit from their views,
by providing a platform to discuss proposed changes to policy and interventions, identify
priorities and think through the longer term implications of a particular course of action.
Government should be encouraged to see such inputs as a valuable element in any process to
review policy and legislation, even though it is likely to involve criticism and generate a
wider array of options. But often the practice in most developing countries shows that there
is limited commitment by government to respond to the comments received, and
uncertainties regarding how to incorporate in practice the diverse observations and counter-
proposals that such a process can generate. Government may therefore find it easier
politically and practically to rely on a small group of experts and consultants to formulate its
plans. But experts cannot replace public debate and the knowledge and experience of
stakeholders who can greatly contribute to identify key issues and innovative solutions.
Moreover, strengthening public debate with people supporting the reform is the best way to
build ownership and to ensure that the reform is not drifting away from the interests of small
farmers.

1.4.4. The Role of Development Aid Agencies and Donors

In the past, many donors have been reluctant to get involved in the politically highly
sensitive field of land policy reform. Most of the time their support, as with other donors and
multilateral agencies, has been limited to promoting titling and land information systems,
non-contentious activities believed to be technical, neutral and universal. This neutrality is
only apparent, and this position often leads to choices unable to fit local realities, thus
excluding the poor.16 In the meantime, policies and approaches have evolved and there is
now greater recognition among donors of the importance of addressing land issues. While
land policy reform is a long and complex process, requiring broad political debate inside the
country, donors can make a major contribution, if they play a cautious role. They can
facilitate the public debate, support processes without forcing the pace, and offer to fund the
costly parts of preparing and implementing land policy reforms, including in particular the
purchase of land for redistribution, without taking over from government. They can
contribute to research, institutional and capacity building for the different actors involved
(government departments, land administration bodies, local government bodies, farmers‘
organizations, etc.) and monitoring and evaluation of the processes.

The role and possible influence of donors in the process of land reform should be extremely
case specific. Since land reform policy by itself is context specific, donors should support
tailor-made solutions, strongly linked to local social and institutional context and avoid

16
EU 2004. Guidelines for support to land policy design and land policy reform processes in developing
countries, EU Land Policy Guidelines.

19
Laad 462 - Land Policy and Reform

blueprints. Therefore, the involvement of donors in the process of land reform should be
based on the following criteria:17
 Land policy reforms are complex undertakings which require: firm political
commitment by the state and support from society at large. Donor support must be
non-dogmatic, non-intrusive and well informed on the situation prevailing locally.
Programs must be appropriate to the local social and institutional context
 Donor support must be accompanied by an in-depth dialogue with the state at the
highest level, and must encourage large inter-ministerial coordination and debate.
 Land policy reforms are long-term processes, going through a series of successive
phases requiring an iterative approach. Donors should stand ready to accompany
such processes over the long period. Sector approaches can provide some safeguards
against the risk of one or the other donor discontinuing support.
 Information and awareness are key elements in the process of land reform. Donors
must contribute to the understanding of different stakeholder interests and strategies
and should encourage the search for consensual solutions.
 Donor support for land reform should in no case result in further deprivation for
women and poor people from access to and control over land or in the dispossession
or eviction of ethnic minorities or tribal and indigenous peoples from the territories
they traditionally occupy.
 Research can be a powerful tool for understanding and steering national processes.
Donors can be instrumental in accompanying implementation with research and
encouraging feedback and debate of emerging issues.

Activity 1.2
1. What is the role of government in the process of land refrom?
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2. Describe the role of disinterested outside observers in the process of land reform?
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3. Discuss the Role of Development Aid Agencies and Donors in the process of land
reform.

17
Ibid.
 -------------------------------------------------------------------------------------------------------
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Dear Student! Have you answered the above questions? If your answer is no, please reread
the sub-section and try to answer those questions again. If your answer is yes, very good, go
to the next section.

1.5. Potential Benefits of Land Reform

Dear Student! In this sub-section you will be introduced with the potential benefits of
land reform. What do you think are the benefits of land reform? Please try to provide your
answer in the space provided below.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
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Have you tried to answer the above question? If your answer is no, please try to discuss with
your friends. If your answer is yes, write your answer on a rough paper and try to relate it
with the following explanation.

Given that land is the primary source of income, security and status for hundreds of millions
of families, it is not surprising that decisively improving their relationship to the land can
serve a number of development purposes. Land reform can, and often has, led to increased
crop production, improved nutrition for poor households, a foundation for sustained and
inclusive economic growth, more democratic societies, reduced social unrest and instability,
better environmental stewardship, reduced urbanization, and improved access to credit.18

i. Increased Crop Production and Nutritional Welfare

18
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank and
Oxford University Press, PROSTERMAN, R. L. & HANSTAD, T. 2000. Land Reform: A Revised Agenda for the 21st
Century. Rural Development Institute RDI Reports on Foreign Aid and Development No.108, Seattle,
Washington.

21
Laad 462 - Land Policy and Reform

As to crop productivity gains resulting from land reform, there is cogent international
evidence on four points.19 First, smaller holdings generally out produce larger ones, hectare
for hectare. Second, and related, family-operated farms generally out produce collective
farms and those largely dependent on wage laborers. Third, on any given holding, a
cultivator with ownership or secure, long-term owner-like tenure is far more likely to make
long-term capital and "sweat-equity" investments that improve and conserve the land than
will a cultivator with insecure tenure. Finally, a cultivator with ownership or owner-like
tenure is also more likely to use improved (and more expensive) seeds, fertilizer, and other
inputs than will a tenant in the typical tenancy arrangement where the tenant pays for all
inputs and receives only a portion of the output.

Additionally, even apart from potential increases in crop productivity, research shows that
access to land has a substantial impact on nutritional welfare. Land reform in traditional
settings improves the lives of beneficiary families, typically among the poorest of the poor,
by letting them keep a significant portion of the crop that would otherwise go to the landlord
or plantation owner.

ii. Foundation for Economic Growth

Land reform also has generated increased overall economic activity.20 As a broad base of
agricultural families benefiting from land reform receive higher incomes, they enter the
marketplace to purchase goods and services, ranging from improved housing to schoolbooks,
from bicycles to sewing machines. This increased demand stimulates the creation of nonfarm
employment. Thus, a dynamic agriculture has significant forward and backward linkages to
broader societal development. Research confirms that a broad-based distribution of land
assets not only benefits the poor, but becomes a solid basis for sustained and inclusive
economic growth.

iii. Facilitating Democracy and Reducing Conflict

As land-reform beneficiaries increase their incomes and become more economically secure
and confident, their ability to participate in the political process is strengthened.21 Initially,
land reform beneficiaries may be empowered to make demands for a fairer share of
government administered programs and services. Land reform creates more secure and self-
confident producers who are willing to challenge the inertia, elitism, and neglect that
frequently characterize the politics of underdevelopment. In addition, land reform has had
fundamental consequences for reducing political instability by eliminating basic grievances
arising from the relationship with the erstwhile landowner. Many of the past century's most

19
PROSTERMAN, R. L. & HANSTAD, T. 2000. Land Reform: A Revised Agenda for the 21st Century. Rural
Development Institute RDI Reports on Foreign Aid and Development No.108, Seattle, Washington.
20
Ibid.
violent civil conflicts ensued where land issues were ignored. Land reform can address the
most basic rural grievances and increase commitment to a system in which new demands are
energized and negotiated. With the fading of revolutionary Marxism as a mobilizing
ideology, outright civil war (as happened in Mexico, Spain, China, and Vietnam) may be less
likely, but ―low intensity‖ violence can still create great instability as a result of unmet
grievances over land whether through land invasions in Zimbabwe or Brazil, peasant-
supported alliances with drug lords in Colombia, or desperate migrants seizing indigenous
lands in the Philippines.22

iv. Foster Environmental Stewardship and Sustainable Farming Practice

Long-term, transferable secure rights to land foster environmental stewardship and

sustainable farming practices.23 Moreover, reallocation of secure rights to existing cultivated
land may also have an important environmental impact through forestalling landless peasants
from descending on, cutting down, and burning the forest in the desperate search for a piece
of land to farm.

v. Reduce Premature and Excessive Urbanization

Many other landless families are driven by their poverty into the cities. Effective land-reform
measures give landless peasant families a stake in their village society, reducing pressures
that lead to premature and excessive urbanization.

vi. Acquire Predictable Market value

Secure land rights that are transferable also acquire a predictable market value, and can be
used as collateral, ―cashed out‖ for non-agricultural investment or retirement, or passed on as
wealth to the next generation. The benefits of land reform described here apply, in general,
not only for land reforms carried out to benefit tenant farmers and agricultural laborers in
traditional less-developed-country settings, but also for land reforms that permit former
collective-farm workers in the transitional economies to obtain secure rights to land of their
own. They, too, invest, increase production, gain income, consume more, become
empowered and less aggrieved, increase their stewardship, and strengthen their rural
attachments.

vii. Tool for Poverty Reduction

21
Ibid.
22
BOYCE, J. K., ROSSET, P. & STANTON, E. A. 2005. Land Reform and Sustainable Development. Political
Economy Research institute working paper No.98, University of Massachusetts.
23
Ibid.

23
Laad 462 - Land Policy and Reform

Land reform is invoked as an instrument for both direct and indirect poverty reduction.24 At
the direct level, advocates claim that it results in greater asset ownership and improved
income streams for beneficiary households and generates increased employment
opportunities in the reform sector. In other instances, it ensures security and increased access
to credit and other factor markets for small rural producers. In theory then, successful land
reform can lead to direct benefits for poor rural producer households. It can also sponsor
more indirect benefits. Increased agricultural incomes for example, lead to increased
demands for tradable commodities and manufactured goods, stemming from both expanded
agricultural potential and general increased consumer demand (i.e. demand for fertilizers,
construction inputs, small-scale repair services and basic consumer goods). These increased
demands yield geographically dispersed growth through linkages with other sectors of the
rural economy.

Activity 1.3
1. Explain how land reform increases crop production?
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2. Discuss how land reform reduces premature and excessive urbanization.
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Dear Student! Have you answered the above questions? If your answer is no, please reread
the sub-section and try to answer those questions again. If your answer is yes, very good, go
to the next section.

24
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank and
Oxford University Press.
 Checklist Questions

Dear distance student! It is time to check your understanding of the concepts discussed
above in unit one. Read each of the following questions and answer them by checking in one
of the boxes under alternatives ―Yes‖ or ―No‖.

Checklist Questions Yes No

1. Can you define land policy means?

2. Can you define land reform?
3. Can you state the key driving forces for undertaking a new land reform
measures?
4. Can you explain the importance of land reform?
5. Can you describe the role of state in the process of land reform?
6. Can you describe how land reform is important for poverty reduction?
7. Can you mention the key issues that should have to be considered in the
process of land reform?

Dear learner! Is there any question for which you tick ―No‖? If your answer is yes, please
go back to your text again and read about it before you go to the following self-test
questions.

25
Laad 462 - Land Policy and Reform

UNIT 2: BASIC CONCEPTS OF LAND AND LAND RIGHTS

UNIT OVERVIEW

Dear Student: In this unit you will be introduced with the basic concepts of land and
land rights. The specific attributes in the bundle of rights will also be discussed in detail.
Finally, the unit discusses property rights regime system.

UNIT OBJECTIVES

After completion of this unit, you are expected to:

 Define land from different perspectives;

 Understand about property rights;

 List out some of the attributes in the bundle of rights
 Describe about property right regimes;
 Understand the difference between open access and common property system.

2.1. Definition of Land from Different Perspectives

Dear Student! What is land? Please try to provide your definition of land in the space
provided below.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Have you tried to answer the above question? If your answer is no, please try to discuss with
your friends. If your answer is yes, try to compare your definition with the definition
provided below.

Land is a term with many meanings and can be explained from different perspectives. To
the physical geographer it is landscape, the product of geological and geomorphologic
processes. To the economist it is a resource which, along with capital and labor, is to be
exploited or conserved in order to achieve economic production and development. To the
lawyer land is a volume of space stretching notionally from the centre of the earth to the
infinite in the sky, and associated with it are a variety of rights which determine what may
be done with it.

Land as a physical/environmental reality: provides the physical space in which we all live,
work and play, and from which we obtain our material needs. It plays a vital role in the
breeding and survival strategies of many living species.If it is taken to include areas that are
covered by water, then all living creatures are dependent upon the land for food, shelter and
social interaction. Land is the foundation of all human activity and its proper management is
a key to the creation and sustenance of civilized societies.

Land as economic value: comprises all naturally occurring resources whose supply is
inherently fixed (i.e., does not respond to changes in price), such as at geographical locations
(excluding infrastructural improvements and "natural capital", which can be changed by
human actions), mineral deposits, and even geostationary orbit locations and portions of the
electromagnetic spectrum.

It is the basis for economic production and development and the creation of wealth. From it
we obtain food and water, materials to build our homes, our shops and factories, and
products such as oil, coal and gas that supply us with energy. It is a commodity to which a
value can be assigned and which can be traded through land markets. It is also a commodity
that can be taxed to produce revenues that support good governance.

Land as legal entity: extends from the centre of the Earth to the infinite in the sky, all things
that are attached to it, and the rocks and minerals that are just below it. Land includes areas
covered by water such as seas and lakes, all building and construction, and all natural
vegetation.Theoretically, land is the section of the earth‘s sphere, and includes all earth down
to the center, and upward into space. As a practical matter, land is the surface and anything
underneath within reach of technology, and no, the sky isn‘t the limit, but a land owner does
enjoy air rights to some extent, although with the advent of modern air travel and neighbors
these rights have been limited by necessity.

Land as cultural entity: unlike personal property and the ownership of movable objects, land
is immovable and indestructible. It therefore has a cultural dimension that lies at the heart of
any nation. Throughout history nations have resorted to war over the possession of land,
while at the local level citizens may fight to defend their own personal territories with many
disputes over boundaries being resolved at a cost that far exceeds the economic value of what
is involved. People often have an emotional relationship with the land that they claim to own
and the locality in which they live, which is why the proper administration of the land is a
necessity for stable societies and social justice.

27
Laad 462 - Land Policy and Reform

In general, land can be defined as an ultimate resource, without it life cannot exist and
sustain. Land includes both a physical and abstract attributes in that the rights to own or use
are attached. It also encompasses all those things directly associated with the surface of the
earth, including those areas covered by water, all the material, biological and chemical
factors which surround human kind It is thus the air we breathe; the water we drink and use
for recreation; the land we cultivate, mine and build on; the cities we flock to in growing
numbers; etc (See figure 1).

Figure 1: Land rights below, on and above the ground

Source: (Dale and McLaughlin, 1999)

Activity 2.1
1. What is land from economic, legal, social and physical point of view?
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Dear Student! Have you answered the above questions? If your answer is no, please reread
the sub-section and try to answer those questions again. If your answer is yes, very good, go
to the next section.
2.2. Property Rights and Property rights Systems

Dear Student! In this sub-section you will be acquainted with property rights and
property rights regime. Please try to answer the following questions on the space provided
below:
a. What is property right?
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b. What are the specific attributes in the bundle of rights?
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Have you tried to answer the above question? If your answer is no, please try to discuss
with your friends. If your answer is yes, write your answer on a rough paper and try to
relate it with the following explanation.

2.2.1. Property Right

Since the central element of land reform is the distribution of land/property rights,
understanding about property rights and property rights regimes is an important precondition
in the process of land reform. Property right is a socially recognized and enforceable
individual or group interest over an asset/land.25 This interest to the asset/land may contain a
variety of rights together as bundle of rights, including the right to exclude non owners
(possessors) from access, the right to appropriate the stream of rents from use and
investments in the resource and the right to sell or transfer permanently to another party and
so on.26 These rights can be provided separately to land or development on it depending on
the legal system of a country.27

Property rights are links between land and its owner/holder. It is through rights that a person
or groups of persons can be linked to a plot of land (see figure 1).

25
OSTROM, E. 1999. Private and Common Property Rights. Workshop in Political Theory and Policy Analysis
and Center for the Study of Institutions, Population, and Environmental Change, Indiana University.
26
LIBECAP, G. D. 1989. Contracting for Property Rights, New York, Cambridge University Press.
27
PAYNE, G. 1997. Urban Land Tenure and Property Rights in Developing Countries A review, London,
Intermediate Technology Publications.

29
Laad 462 - Land Policy and Reform

Figure 2: Property rights as a link between man and land

Source: (Henssen, 1995)

Each plot of land has its unique set of property rights which are bound together as bundle of
rights and which may belong to single individual or different individuals. Bundle of rights
can also describe quantities of rights, size (thickness) of rights and duration of rights attached
to land.28 These quantities of rights include use rights like the right to derive benefit from the
asset; control rights like rights to make decisions how the land should be used and; transfer
rights like rights to sell, mortgage, to convey the land to others and to reallocate the use and
control rights.

The attributes of rights in the bundle can also be further split into five different levels of
actions and restrictions ordered from the least authority of ‗access‘ with a lot of restrictions
to the greatest authority of ‗alienation‘ with less restrictions, which usually equates to
ownership.29 Such rights are rights of access, withdrawal, management, exclusion and
alienation. These rights can be separately assigned to different individuals or cumulatively to
collectives or single individuals as full ownership rights.30
a. Access right: The right to enter a defined physical area and enjoy non subtractive
benefits (for example, hike, canoe, sit in the sun);

28
FAO 2002. Gender and Land Tenure Rome, FAO.
29
OSTROM, E. 1999. Private and Common Property Rights. Workshop in Political Theory and Policy Analysis
and Center for the Study of Institutions, Population, and Environmental Change, Indiana University.
30
Ibid.
 b. Withdrawal right: The right to obtain resource units or products of a resource system
(for example, catch fish, divert water, cut tree in the forest);
c. Management right: The right to regulate and improve the resource providing units for
withdrawal. In other words it is the right to determine how, when, and where
harvesting from a resource may occur, and whether and how the structure of a
resource may be changed;
d. Exclusion right: The right to exclude any particular person wanting to assert access,
withdrawal and management rights; and
e. Alienation right: The right to transfer for a period or forever of any or all of the above
rights.

Attached to the above lists of rights, ordered from access to alienation, there are five different
right holder classes at different levels of exercising rights. These right holders with different
levels of authority to exercise the rights are distinguished as authorized entrants, authorized
users, claimants, appropriators and owners respectively.31 The difference in the positions of
right holders (users) and their respective actions will be very visible simply by comparing
owners who hold alienation with a complete set of rights, and all other right holders who do
not hold complete set rights (see table 1).

Table 1: Bundle of rights and right holders

Bundle of Rights Holders
Rights
Authorized Authorized Claimant Proprietor Owner
entrant user
Access     
Withdrawal    
Management   
Exclusion  

Alienation 

Source:(Schlager and Ostrom, 1992)

1. Authorized entrants: refers to those users who can get access to a resource in a very
limited sense, like a person who buys an operational right to enter and enjoy the
natural beauty of a park but who do not have a right to harvest forest products or
remove the flowers from a park. This user holds solely access rights.
2. Authorized Users: refers to those users who can access a resource and withdraw

31SCHLAGER, E. & OSTROM, E. 1992. Property Rights Regimes and Natural Resources: A Conceptual Analysis.
Journal of Land Economics, Vol. 68, No.3, pp 249-262.

31
Laad 462 - Land Policy and Reform

products. These users hold access and withdrawal rights but lack the authority to
devise their own harvesting rules.
3. Claimants: They possess the operational rights of access and withdrawal plus the right
of managing a resource. Claimants‘ rights also include decision –making power
concerning the construction and maintenance of facilities as well as the authority to
devise limits on withdrawal right. But the claimants do not have the right to exclude
others from the use of a resource.
4. Proprietors: They hold the same rights as claimants with the addition of the right to
determine who may access and harvest from a resource. They also dispose of exclusion
rights. Most of what is known as common property regimes falls in this category.
However, proprietors do not possess the right to sell rights even though they most
frequently have the right to bequeath it to members of their family
5. Owner: possess the right of alienation and hold all other rights such as access,
withdrawal, management and exclusion. The right to transfer a good by owner‘s wishes
should not harm the physical attributes or uses of other owners. Private property owners
have responsibilities not to generate particular kinds of harms for others.32 Therefore,
in reality, even the rights of private owners are not absolute.

The right holders or users of rights can exercise the rights with in bundle separately or
cumulatively depending on the level of authority. That means, it is possible to have entry
rights without withdrawal rights, to have withdrawal rights without management rights, to
have management rights without exclusion rights and to have exclusion rights without
alienation rights. This shows that individuals or groups may and frequently do, hold property
rights that do not include the full set of rights defined above. On the other hand, holding
some of these rights implies that there is an implicit holding or possession of other rights. For
example, exercising of withdrawal rights is not meaningful without the right of access or
exercising alienation rights means that all other rights also included.33

The quantity of rights exercised by property holders affect the incentives individuals face, the
types of actions they take and the outcomes they achieve.34 Exclusion rights for both
proprietors and owners produce strong incentives to make current investments in resources,
because proprietors and owners can decide who can and cannot enter a resource or they can
capture for themselves for their offspring benefits from investments they undertake in a
resource. They are reasonably assured of being rewarded for incurring the costs of
investment. In addition, owners and proprietors can devise access rights that allow them to
capture the benefits produced by the withdrawal rights.

32
Ibid.
33
OSTROM, E. 1999. Private and Common Property Rights. Workshop in Political Theory and Policy Analysis
and Center for the Study of Institutions, Population, and Environmental Change, Indiana University.
34
SCHLAGER, E. & OSTROM, E. 1992. Property Rights Regimes and Natural Resources: A Conceptual Analysis.
Journal of Land Economics, Vol. 68, No.3, pp 249-262.
The right of alienation exercised by owners only is at the highest level of rights order.
Exercising the right of alienation is equivalent to private property regime in which
individuals (owners) can exercise full sets of rights and can transfer any or all sets of rights
for a period or forever. Alienation combined with other rights, produce strong incentive for
owners to undertake long-term investments in a resource. Through the sale or lease of all or
part of the property rights owners hold, they can capture the benefits produced by long-term
investments. The alienation of rights permits a resource to be shifted from a less productive
to a more productive use. On the other hand, property rights systems that do not contain the
right of alienation are considered to be ill-defined. The inalienation of property rights is
presumed to lead to inefficiency of resource use since property rights holders can not trade
their interest in an improved resource system for other resources, nor can someone who has a
more efficient use of a resource system purchase that resource as whole or in part.35

The existence of limitations and restrictions on the transferability of ownership or use rights
is obviously a constraint for economic efficiency.36 However, alienation of rights are
restricted and limited in one way or the other, both in developed and developing countries,
both currently and in the historical past, depending on their national land tenure policy.
Alienation is a very complex concept due to its various attributes which requires further
splitting and analysis so as to understand the type of property system.

2.2.2. Property Right System/Regime

The allocation of rights varies from one property rights regime to the other. Property rights
regimes describe how rights to a particular resource are assigned and defined.37 Property
rights regime can also describe how the different attributes are distributed among the right
holders. Based on the possibility to assign property right elements, four types property right
regimes are identified in the contemporary literatures: 38
a. Open Access System: all land rights are held by no one. It is non- excludable (no one
can exclude anyone else from using it. Open-access property is not managed by
anyone, and access to it is not controlled. In open-access property system ownership
has never been established. Examples of open-access property are the atmosphere or
ocean fisheries.
b. Common property System: all land rights are assigned to a community or a group of
individuals collectively. Access, use, and exclusion are controlled by the joint
35
DEMSETZ, H. 1967. Toward a Theory of Property Rights. The American Economic Review, Vol. 57, No. 2, pp.
347-359.
36
ROSE-ACKERMAN, S. 1985. Inalienability and The Theory of Property Rights Colombia Law review Vol.
85:931, pp. 931-969.
37
EKBÄCK, P. 2009. Private, Common, and Open Access Property Rights in Land –An Investigation of Economic
Principles and Legislation. Nordic Journal of Surveying and Real Estate Research Vol.6, N0. 2, pp.57-74.
38
SCHLAGER, E. & OSTROM, E. 1992. Property Rights Regimes and Natural Resources: A Conceptual Analysis.
Journal of Land Economics, Vol. 68, No.3, pp 249-262.

33
Laad 462 - Land Policy and Reform

owners. Unlike open-access property, common property owners have greater ability
to manage conflicts through shared benefits and enforcement.
c. Public/State Property System: the property system over which the state exercises
ownership and governance of land.
d. Private Property System : all elements of land rights are assigned to individual or
legal individuals such as companies

From efficiency point of view, private property system is often assumed to be superior to the
other property systems so as to lead towards economic efficiency.39 It is only in private
property regime that the rights to the property are more universal, exclusive and transferable
than any other property regime. Thus, an efficient property system is the one which satisfies
the characteristics of (1) universality where all scarce resources are owned by someone; (2)
exclusivity where property rights are exclusive rights; and (3) alienability refers to
transferring the rights to the others.

The possibility to exclude and transfer land rights can generate incentives that tend to lead to
higher levels of productivity than other forms of property management.40 Transferability
rights can also ensure that resources can be allocated from low to high yield uses.
Alienability of rights is the typical characteristic of private property which in other words it
is equivalent to private property regime. On the other hand, inalienability which can be
defined as the existence of restrictions on transferability of rights will lead to inefficiency on
market trades.

Activity 2.2
1. Define what property right does mean?
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2. List out some of the attributes in the bundle of rights
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3. What is the difference between open access and common property system?

39
DEMSETZ, H. 1967. Toward a Theory of Property Rights. The American Economic Review, Vol. 57, No. 2, pp.
347-359.
40
COLE, D. H. & OSTROM, E. 2012. The Variety of Property Systems and Rights in Natural Resources. In: COLE,
D. H. & OSTROM, E. (eds.) Property in Land and Other Resources, Lincoln Institute of Land Policy.
 -------------------------------------------------------------------------------------------------------
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4. What is the major difference between being owner and proprietor?
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Dear Student! Have you answered the above questions? If your answer is no, please reread
the sub-section and try to answer those questions again. If your answer is yes, very good, go
to the next section.

35
Laad 462 - Land Policy and Reform

UNIT3: APPROACHES TO LAND REFORM

UNIT OVERVIEW

Dear Student: In this unit you will be introduced with the approaches of land reform.
Three principal approaches of land reform will be discussed in detail. These land reform
approaches are: i) state-led (political economy) approach to land reform; ii) market-driven
(neo-liberal) approach to land reform and iii) actor oriented approach to land reform.

UNIT OBJECTIVES

After completion of this unit, you are expected to:

 Understand about state-led approach to land reform;

 Explain about market-led approach to land reform;

 Understand about actor oriented approach to land reform;
 Compare and contrast about the different approaches of land reform.

3.1. Introduction

Dear Student! In this sub-section you will be acquainted with the different approaches
to land reform. Please try to answer the following questions on the space provided below:
a. What is state-led approach to land reform?
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b. What do you know about market led approach to land reform?
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 c. Can you describe about actor oriented approach to land reform in your words.
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Have you tried to answer the above question? If your answer is no, please try to discuss
with your friends. If your answer is yes, write your answer on a rough paper and try to
relate it with the following explanation.

Land reform is a very complicated process that takes place at different scales, by different
actors, and that interacts with other processes and in the society. It would therefore be a huge
task to capture land reform in its totality. Even if everything could be captured it would
remain impossible to make sense of all the data collected. For this reason academics, policy
makers and other people will (implicitly or explicitly) take a particular perspective/approach
with which they observe, discuss and evaluate land reform. And when they think about land
reform, their perception is to some extent influenced by the assumptions that they made in
advance.

Different theoretical frameworks exist in academic debates about land reform that give
direction to the way reality is interpreted, and these different perspectives give priority to
certain aspects of reality while obscuring others. In the contemporary literature and practice
three alternative perspectives/approaches have been applied to design and implement land
reform policies.41 These approaches are:
i. State-led (Political economy) Approach to land reform
ii. Market-Driven (Neo-liberal) Approach to Land Reform
iii. Actor Oriented Approach to Land Reform

Contemporary land reform policies in most countries are to a large extent shaped either by
the neo-liberal perspective which focuses on market dynamics and agricultural productivity
or state led political economy approaches to land reform.42 Both neo-liberal views and
political economy views have however often been criticized by scholars.43 Actor oriented
approach is another alternative as a remedy to the limitations of neo-liberal and political
economy approaches.
41
BOS, K., PAUWELUSSEN, A., BERG, L. V. D., NOTTEN, E. & DRAAIJER, A. G. 2009. Learning about Land Reform
in South Africa: A Social Scientific Approach. . Wageningen University.
42
Ibid.
43
SIKOR, T. & MÜLLER, D. 2009. The Limits of State-Led Land Reform: An Introduction. World Development
Vol. 37, No. 8, pp.1307–1316.

37
Laad 462 - Land Policy and Reform

Political economists favoring state-led land reforms argue that the solution to the inequalities
in the distribution of wealth would be alleviated by direct intervention of state. As the poor
classes generally lack proper political representation, the state is responsible for helping these
farmers to better their position on the market and in society in general. Important here is that
the solutions envisaged by the two different approaches stand in direct relationship with the
land reform problems that are seen as most important. Neo-liberals are more concerned with
constraints to economic growth and innovation in agriculture. Political economists see
structural inequality in wealth, power and livelihood opportunities as the most important
problems of land reform. Political economists then argue that the government should take a
more radical interventionist approach to land reform to counter market forces and powerful
groups. The details about the three approaches of land reform are provided in the following
sections of this chapter.

3.2. State-led (Political economy) approaches to land reform

In a state-led approach to land reform, the units of analysis are the state policy elites
(policymakers and managers), and the agencies and organizations responsible for carrying
out public policies. Exponents of this approach, see the state as an institution of governance
autonomous from society.44 Taking the state as an independent actor and independent
variable, state-centered scholars often assume that the state is autonomous in making policy
choices and in transforming them into authoritative actions, even when these run counter to
the interests of the dominant classes or groups in society. Many scholars and policy
practitioners of this approach place a premium on the administrative design of the policy,
believing that such a policy, if carried out by an efficient state organization, has little reason
to fail.

Historically, state-led approaches to land reform has been widely employed in most Latin
American, Asian and African countries and dominated the conversation and context of land
reform and have received the attention of academics and international organizations.45 46Even
though it is difficult to clearly delineate the realm of land reform characterized as ―state-led‖
due to its wide range of goals and methods, it is to mean that a deliberate change related to
land managed by national governments through institutional reform in policy or law.
Throughout history this approach has had diverse objectives. At times it has been used as a
means of poverty relief for rural peasants or farmers. It has been part of an overarching plan
to increase agricultural productivity and efficiency in natural resources management and use.

44
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
45
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
46
MOYO, S. 2000. The Political Economy of Land Acquisition and Redistribution in Zimbabwe, 1990-1999.
Journal of Southern African Studies, Vol. 26, No.1, pp. 5-28.
State-led land reform has also been used as a tool of political pacification of rural unrest and
to alleviate the growing density of developing areas.47 During certain eras it has served as a
tool of industrialization, modernization and urbanization. Idealistically it is a tool of justice,
increasing equity of wealth distribution. Therefore, state-led land reform projects often
represent more than one of the objectives.

Political economists favoring state-led land reform see capitalism (free market) as a force
that leads to the exploitation of the weak and poor and for them capitalism is not as a force of
positive change.48 They argue that the increasing exposure of the poor to the forces of
privatization and commercialization lead to the weakening of the poor and landless classes.
Capitalism or the spread of (‗free‘) markets then mainly benefits and enforces the more
powerful classes. On the other hand, the poorer rural classes have a disadvantage to get
access to the market because of a lack of capital, access to technology and
communication/information networks.

Thus, according to political economists, the spread and penetration of capitalism into
different modes of production causes the position of the poor and weaker classes in society to
be weaken and excluded.49 This is because new technologies and scale enlargement lead to
increased production, which in turn leads to a decrease in prices of the products sold. The
decrease in the price means farmers get less for their product and thus leads to a reduction in
their profit margin. Smaller farmers are disproportionately struck by this and as a result they
either disappear or are considerably weakened.

Box 1: State-led Political economy approaches to land reform:

 Focus on relation between economy and politics
 Focus on power relations and classes
 The state, instead of the market, should be in control
 Capitalism weakens production of small
 Multiple objectives, beyond efficiency and productivity

Based on the rationales of political economy approaches to land reform, the methods used by
governments to design and implement land reform policies are many and varied.50 The most
conventional /traditional method of land reform is the imposed redistributive reform. These
reforms provide land ownership to tenant farmers or agricultural laborers by dividing large
47
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
48
BOS, K., PAUWELUSSEN, A., BERG, L. V. D., NOTTEN, E. & DRAAIJER, A. G. 2009. Learning about Land Reform
in South Africa: A Social Scientific Approach. . Wageningen University.
49
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
50
Ibid.

39
Laad 462 - Land Policy and Reform

holdings of private landlords into small and medium plots. The role of the state in these types
of reforms is so crucial and the state is responsible for articulating and implementation of
public policy.51 Although prior enacted and imposed redistributive policies dominated the
political agenda of land reform in the 1950s and 1960s in Asia, Latin America and in some
African countries has diminished currently, governments do continue to enact land tenure
reform, land restitution, land consolidation and other strategies.52

Land tenure reform includes the development of techniques and institutions that make land
tenure work more efficiently, effectively and fairly.53 This includes development of legal
support and land system information, establishment of property rights through legal reform
and land registration, and land leasing as a means to increase productivity of land. Currently
there is a focus from bilateral donors to support the development of modern land tenure
legislation, cadastres and land registries. This is considered a necessary process to facilitate
success in other methods of reform (especially in market-led reform). Land restitution is a
legal approach to restore violated land rights through the presentation of claims to a court
system. Moreover, state-led approaches to land reform also include the recognition and
protection of communal ownership of land based on customary tenure systems, as well as
settlement or resettlement programs on public lands.54

3.2.1. Criticism and Limitations Of State-Led Land Reforms

The success of state-led land reforms is not free from debate and criticism from scholars in
the field and scholars of other approaches. The potential benefit of state-led land reforms to
achieve desirable changes in actual land tenure and land use is limited.55 According to pro-
market critique, state led approach is top-down initiatives that cause land reform programs to
miss out important developments on the ground and fail to enlist support from relevant
actors. It relies heavily on the central state and its huge bureaucracy for implementation
through top-down methods that fail to capture the diversity between and within local
communities and are unable to respond quickly to the actual needs at the local villages.56

51
BARRACLOUGH, S. L. 1999. Land Reform in Developing Countries : The Role of the state and other actors.
United Nations Research Institute for Social Development, Discussion Paper No. 101, June 1999
52
SIKOR, T. & MÜLLER, D. 2009. The Limits of State-Led Land Reform: An Introduction. World Development
Vol. 37, No. 8, pp.1307–1316.
53
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
54
ILC 2003. Towards a Common Platform on Access to Land :The Catalyst to Reduce Rural Poverty and the
Incentive for Sustainable Natural Resource Management. Rome International Land Coalition
55
SIKOR, T. & MÜLLER, D. 2009. The Limits of State-Led Land Reform: An Introduction. World Development
Vol. 37, No. 8, pp.1307–1316.
56
BORRAS, S. M. 2003. Questioning Market-Led Agrarian Reform:Experiences from Brazil, Colombia and South
Africa. Journal of Agrarian Change, Vol.3, No. 3, pp.367–394.
Pro-market complains to state-led land reform also show that reliance on bureaucratic
modalities hinders the adaptation of state‘s action to tenure arrangements and authority
relations on the ground.57 That is why experiences in Sub-Saharan Africa, where many land
registration programs of the 1970s and 1980s failed to achieve their stated goals. National
governments and international donors had conceived them based on the assumption that
customary arrangements did not provide the necessary security for agricultural investments
and increases in land productivity. State action was necessary to create the required security
by way of systematic registration and titling. Yet the insights from research in agricultural
economics discussed by place contradict the major tenets of state-led land reform. The
assumption that land tenure is generally insecure under customary arrangements does not
hold. In addition, state registration and titling do not automatically enhance tenure security
(measured in various ways), but may even be a source of insecurity.

Although state-led land reforms usually recognizes rights of the rural poor and marginalized
groups of the society to land and aims to increase just relationships, it does not often succeed
in shifting inequitable power relationships.58 Land is generally concentrated in the hand of
the politically and socially powerful; therefore, attempts to redistribute their source of secure
wealth, regardless of the rate of compensation given, meet with great resistance. Moreover,
the processes are top-down, application of local information is limited and power is
maintained in the hands of those who already have wealth and influence.59

Moreover, state-led approach has been criticized by being supply- driven.60 It starts either by
first identifying lands for expropriation and then looks for possible peasant beneficiaries, or
by first identifying potential peasant beneficiaries and then seeking lands to be expropriated.
This leads to heightened economic inefficiency, when (1) productive farms are expropriated
and subdivided into smaller, less productive farm units, or when environmentally fragile
(usually public) lands are distributed by the state; or (2) when peasant households considered
unfit to become beneficiaries are given lands to farm. The critique continues, arguing that the
state-led approach relies heavily on the central state and its huge bureaucracy for
implementation through top-down methods that fail to capture the diversity between and
within local communities and are unable to respond quickly to the actual needs at the local
villages.61 This approach strengthens the interest of the state that is in conflict with the rapid

57
SIKOR, T. & MÜLLER, D. 2009. The Limits of State-Led Land Reform: An Introduction. World Development
Vol. 37, No. 8, pp.1307–1316.
58
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank and
Oxford University Press.
59
Ibid.
60
BORRAS, S. M. 2006. The Underlying Assumptions, Theory, and Practice of Neoliberal Land Policies. In:
ROSSET, P., PATEL, R. & COURVILLE, M. (eds.) Promised Land : Competing Visions of Agrarian Reform. New
York: Institute for Food and Development Policy.
61
Ibid.

41
Laad 462 - Land Policy and Reform

redistribution of land and expropriation at below market prices requires that the state
purchase the land rather than the beneficiaries.

Finally, state-led land reform is also criticized for being expensive and for inducing
additional costs to the government.62 The subdivision of land into small farms with the aim
of distributing land for landless needs huge amount of money and it is time consuming and
puts administrative burden.

3.3. Market Driven (Neo-liberal) Approaches to Land Reform

The neoliberal perspective mixes neo-classical economic theory with liberal values and it
centers itself on the workings of market and profit maximization. A Neo-liberal approach to
land reform also centers itself around the workings of the market.63 The market is seen as an
ordering mechanism that can be used to promote development. Firms, including farms,
operate in the market and are assumed to maximize profit. They compete with other firms for
resources and this ensures the optimal use and allocation of scarce resources. Technology can
further improve the efficiency in the process of converting scarce resources into final goods
and can therefore stimulate development.64

Neoliberal approach to land reform depends upon land market for the redistribution of
property ownership and follows a general model that combines civil, government and market
sectors. Neoliberal policy makers promote free markets as a means of poverty relief.
Neoliberal land policies emerged and became an important aspect of, mainstream thinking
and development policy agendas in early 1990s by end of cold war. Currently, neo-liberal
policies have increased in prevalence and they mainly deal with both public and private
lands, and have manifested in four broad policy types:65
i. Privatization and individualization of public/ communal lands,
ii. Privatization and individualization of property rights in state and collective farms in
(ex-)socialist and capitalist settings,
iii. Promotion of land rental markets, and
iv. Land sales.

The above land policy options have been formulated by broadly pro-market scholars and
policy makers, and have been aggressively promoted by the World Bank and other

62
Ibid.
63
Ibid.
64
BOS, K., PAUWELUSSEN, A., BERG, L. V. D., NOTTEN, E. & DRAAIJER, A. G. 2009. Learning about Land Reform
in South Africa: A Social Scientific Approach. . Wageningen University.
65
BORRAS, S. M. 2006. The Underlying Assumptions, Theory, and Practice of Neoliberal Land Policies. In:
ROSSET, P., PATEL, R. & COURVILLE, M. (eds.) Promised Land : Competing Visions of Agrarian Reform. New
York: Institute for Food and Development Policy.
international development institutions as the solution to persistent landlessness and poverty
in the countryside of most developing countries.66 Neo-liberal pro-market land reforms have
emerged in recent years as a non-coercive alternative to traditional land reform in a number
of countries, including Brazil, Colombia, and South Africa.67 In market-led land reform, land
is redistributed through the voluntary transactions of the land market.

The role of the state in this method of land reform is to establish legal, political and
institutional frameworks that ensure a level playing field for all.68 This involves removing the
barriers in the banking and credit supply to landless rural people, reducing transaction costs
of land registration, supplying land market information, and providing technical support to
new owners. Governments should also provide loan and grant funding as a joint effort with
international institutions, such as the World Bank. Although the state plays a supporting role,
it does not ―manage‖ or direct the process in such a way that it significantly controls the
outcomes of reform as it does in the government-led methods discussed earlier.

The shift from the policy/institutional sphere to the market sphere as the setting for land
reform has both advantages and disadvantages. In response to the failure attributed by many
of state led reforms in 1960s and 1970s due to entrenched systems of political power, this
method attempts a politically neutral land reform through the ―politics-free‖ land market.69 It
also reduces the bureaucratic process that has made prior methods ineffective due to the
tremendous inefficiency of enforcing new law and policy. It reduces more centralized
management of land reform, it theoretically gives more agency to local people. As a potential
means of collaborating local initiative, markets, and government assistance, this method of
land reform is regarded as having high potential to be effective if context and application are
correct.70

The key elements required for the success of this approach are: markets for land sales and
rental must be transparent and fluid, productive projects must be a core element as essential
to the establishment of economically stable farms, implementation must be demand-driven
and decentralized in order to coordinate collaborating entities, and the private sector must be
involved in aspects of training and development.71 An emphasis should also be given to the
―ownership‖ of the program by local governments, public participation, and systems of
monitoring and evaluation.
66
Ibid.
67
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
68
BORRAS, S. M. 2006. The Underlying Assumptions, Theory, and Practice of Neoliberal Land Policies. In:
ROSSET, P., PATEL, R. & COURVILLE, M. (eds.) Promised Land : Competing Visions of Agrarian Reform. New
York: Institute for Food and Development Policy.
69
DIMMITT, A. 2008. Agros International white paper: a review of land reform methods. Agros International.
70
Ibid.
71
DEININGER, K. 1999. Making negotiated land reform work: Initial experience from Colombia, Brazil, and
South Africa. World Bank Policy Research Working Paper 2040.

43
Laad 462 - Land Policy and Reform

Box 2: Neo-liberal Approaches to Land Reform

1. The rule of the market
2. Privatization
3. Deregulation
4. Applying new and improved technology
5. Large-scale is the norm

Neo-liberal approach to land reform is also not free from criticism. It has received a lot of
criticism from political economists. The criticisms are stated in one way or the other in the
previous as well as in the next sections of this chapter. The summary of the two dominate
approaches to land reform is provided in table 2 below.

Table 2: Key features of state-led and market-led approaches of land reform

Issues State-led Market-led
Land Acquisition Coercive; cash-bonds Voluntary; 100% cash
method payments payment based on 100%
at below market price market value of land
Beneficiaries Supply-driven; Demand-driven; self-
state-selected beneficiaries selected
Implementation Statist-centralized; with Privatized; decentralized;
Method low degree of transparency with high degree of
and accountability transparency and
accountability
Pace and nature Protracted; politically and Quick; politically and
legally contentious legally non-contentious
Land prices Higher Lower
Land markets Land reform: cause of/ Land reform: cause and
aggravates land market effect of land market
distortions; progressive stimulation; progressive
land tax and land titling land tax and titling
program not required program required
Program Sequence; Farm development plans Farm development plans
development and after land redistribution. before redistribution.
extension service Protracted, uncertain and Quick, certain, and
post –land transfer dynamic post-land transfer
development; development; extension
extension service service privatized &
 centralized= inefficient decentralized = efficient
Credit and Low credit supply and low Increased credit and
investments investments investments

Exit options Little or None Ample

Financing State ‗universal‘ subsidies; Flexible loan-grant
Mechanism beneficiaries pay subsidized mechanism; co-sharing of
land price; dole out risks; beneficiaries
mentality among shoulder full cost of land;
beneficiaries farm development cost
given via grant
Cost of reform High Low
Source: (Borras, 2003)

3.4. Actor-oriented approaches: A focus on people

Taking social classes and interest group formations in society as their units of analysis,
advocates of an actor/society-centred approach identify social mobilization from below as the
key to successful land reform implementation.72 Currently, land policies that are more
human centered and pro-poor and less driven by economic prescriptions are being promoted
by different international development and financial institutions like the World Bank.

Both market-led neoliberal and state-led political economy methods of land reform have
given little emphasis on actors and their activities in a specific context. Neo-liberal and
political economy perspectives see development as a linear process determined by large
(structural) forces.73 Neo-liberalists visualize the survival of profit maximizing,
entrepreneurial farmers, who use and invest in new technology to modernize and enhance
their production for the market. Those that do not follow this logic will be outcompeted. For
political economists capitalism leads to class polarization and the weakening of small
farmers. In both theories the weaker groups in society, like women and poor farmers, are
visualized as more or less homogenous groups, in which all members in the group share the
same needs, and have the same reasons for their decisions related to the use of land. Also, in
theoretical approaches, the poor, women, small-scale farmers, etc, do not seem to have
agency. They are often portrayed as victims of wider processes and external pressures in
society; for example policy decisions by the government or economic processes at the
national or global level.

72
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
73
BOS, K., PAUWELUSSEN, A., BERG, L. V. D., NOTTEN, E. & DRAAIJER, A. G. 2009. Learning about Land Reform
in South Africa: A Social Scientific Approach. . Wageningen University.

45
Laad 462 - Land Policy and Reform

Both neoliberal and political economy approaches to land reform tend to give little emphasis
on the level of the actors. There has been much evidence that individual farmers act different
from how both neo-liberals and political economists predict. It is important to study the
different actors in their own terms, to see how they make sense of the world, how they
behave, identify and deal with the constraints and opportunities they face. Knowing this
improves land policy in the sense that actual (rather than imaginary) constraints faced by
farmers can be addressed.

Box 3: Actor oriented approach

 Development is not a linear process
 The actor has a central position
 Actors have ‗agency‘
 Negotiations and interactions between actors are important

According to actor oriented approach to policy development, policy makers must look from
the perspective of the actor rather than assuming external forces (such as the market or
powerful classes) determine the existence or survival of specific classes. Because actors
have ‗agency‘: they have knowledge of their own situation, they can reflect on things that are
happening to them and they can find ways to cope under pressure.74 So even though the
market may be a force that restricts the behavior of peasants, these peasants may still devise
ways to cope with this without disappearing (as theorized by political economists) or turning
into entrepreneurs (as theorized by neo-liberals). Farmers do not necessarily adopt the profit
maximizing logic and only value production as promoted by neo-liberals. They may have
another logic, which may be more optimal or not, but which is at least embedded in their
actual personal circumstances and their own values. What is more important here is that the
logic differs for different people and localities.

Moreover, an actor oriented approach to land reform is an outcome of negotiations and

interactions between different actors, not only between groups but also within groups. These
include policy makers, lobbyists, agribusinesses companies, NGO‘s, and social movements.
Therefore, land policy formulation requires description of the local situation so as to
understand the historical and current conditions that shaped it and the perspective that is
being used to promote it. Studying the different actors and their interactions allows us to find
out how they are affected by the policy as well. Although the main goal of land reform is to
address the historical inequality and injustice, the reform should also aim to increase
productivity. Actors should not and cannot be reduced to a homogeneous group.

74
LONG, N. 2004. Actors, interfaces and development intervention : meaning, purposes and powers. In:
KONTINEN, T. (ed.) Development Intervention : Actor and Activity Perspectives. Helsinki: University of Helsinki,
Center for Activity Theory and Developmental Work Research and Institute for Development Studies.
Land reform does not only involve beneficiaries and policy makers. Other actors may
(directly or indirectly) affect the land reform process. Land owners and consultants often play
important parts in this. These negotiations are not always constraining but may equally lead
to arrangements that are more suitable than that envisaged by the consultants.75 Negotiation
is also takes place within the group of farmers where land is granted to groups. Although
these groups may have a common ancestry in the land they should not be seen as a
homogeneous group. There are differences in gender, age, and most have lived in very
different places after eviction.

3.5. The process of designing land reform

This section mainly intends to cover issues and list of questions to be considered when
examining national land policy and strategies so as to design and devise new land policy. The
first core component and activity in the process of designing a new land reform policy for a
country or a specific place is situation analysis.76 Situation analysis includes mainly
examining land and natural resources and key development challenges. The main
development challenges related to questions of land tenure and access being faced by the
country should have to be analyzed in the context of political, economic, social justice and
poverty, sustainability and financial issues.77
 Political terms: government‘s interests in questions of land policy, access, security
and equity, amongst political parties and other political forces in society; current and
recent political debate about land policy and law; existence and nature of conflicts,
social, ethnic and regional disparities involving land, and potential risks of wider
(possibly violent) conflict where the land issues involved are not dealt with should be
part of this phase of land reform policy design.
 Economic terms, how land issues are related to productivity, investment and
employment: what changes in land policy may be needed to improve productivity and
investment, such as greater security of land rights, improvements in land distribution,
easier access to land, land-based opportunities to access credit and to facilitate the
operation of land markets etc. A particularly important issue is whether or not land
scarcity can be offset by agricultural diversification and creation of nonagricultural
employment opportunities.
 Equity, social justice and poverty: includes the extent of landlessness, evictions, land
tenure or access problems faced by particular social groups including women,
pastoralists, minority groups and indigenous people or regions, land grabbing and

75
BOS, K., PAUWELUSSEN, A., BERG, L. V. D., NOTTEN, E. & DRAAIJER, A. G. 2009. Learning about Land Reform
in South Africa: A Social Scientific Approach. . Wageningen University.
76
EU 2004. Guidelines for support to land policy design and land policy reform processes in developing
countries, EU Land Policy Guidelines.
77
Ibid.

47
Laad 462 - Land Policy and Reform

illegal appropriations of natural resources, degree of landownership concentration,

share of idle land.
 Environmental sustainability: the role of land policies and laws, planning and
regulation of land use and other natural resource use, land management. Land quality
assessment and land use planning. Trends in land use and land degradation
 Fiscal and financial issues: Value of land and property, taxation either by (local)
government or customary rulers, role of land purchase and rental markets in the
economy, cost of agrarian debt.

3.5.1 Analysis of Policy, Legal and Institutional Framework

New land policies should be integrated into efforts by states to establish more democratic
forms of governance at national and local levels, and should offer to all citizens, a guarantee
of their rights together with ways of addressing land related problems they face. A genuine
and inclusive participatory land policy design is a condition of broad acceptance of a new
policy which must respect the rights of minorities and provide equal rights to men and
women.

a. Historical Background on Land Issues and Policies

What has been the past experience with land issues, legislation and interventions concerning
land in the more distant past as well as over the last 10-20 years? Is there analysis available
of how such interventions have affected actual practice in different areas? What impacts have
these interventions had on vulnerable groups and gender equality? What implications does
this provide for new land reform policy design and implementation?

b. Analysis of Policy and Legislative Framework

 The national land policy, content and process: Has the government formulated a land
policy and strategy to reform land tenure and natural resource management? If so,
have environment, gender, HIV/AIDS issues and their impact on social relations and
agriculture, been taken into account in the design of the policy? Has due account been
taken of indigenous peoples‘ land rights and land claims? Was the design
participatory? If not are there calls to do so within government or society or from
outside agencies? Is there or has there been any sort of structured process, such a
formally constituted Commission of Enquiry into land issues and how they are to be
addressed? Have different groups, in particular women, been consulted? Where they
part of the formal consultation process (e.g. the Commission of Enquiry)? Are people
(particularly in rural areas) aware of and informed about the content of the new
policy? Is it broadly accepted across society? Have the views of minorities and
marginal groups been requested? Are they reflected in the policy?
  Land and development strategies: How does tenure policy link to other broad
development policies and strategies, such as development policy, poverty reduction
strategies, policies on gender equality, agricultural policy and land use planning at
local and regional levels? Is there a mechanism to achieve these linkages? Are there
contradictions between land policies and other policies?

 Land legislation: What is the content of current or planned legislation relating to land
rights, land tenure, land and natural resource management, land markets and land
institutions? Are they coherent with each other? More specifically:

 Land Rights: What range of rights is covered by legislation on land tenure and
natural resource management? What status is accorded to local/customary rights
within the legal framework and how do these relate to statutory provisions? Is it
possible to register joint ownership of land and natural resources, e.g. at community
level? Do the poor have effective access to the information regarding legal
procedures for the registration of rights and/or transactions? How are secondary
rights protected under the new regulation? To what extent are land rights of
indigenous peoples and minorities recognized and effectively protected?

 Laws and socio-political rights: Does legislation meet the expectations of different
key actors as regards providing secure rights and access to land? Does the land policy
and legislation guarantee the land rights of the poor (whether these are established
formally or informally through transactions or relationships with other land users) and
assist them to access fundamental rights of citizenship, and means of shelter and
livelihood? Is there provision for joint spousal ownership of land and property or are
the rights of wives restricted and subordinated to those of husbands or male relatives?
Do government policies or actions undermine existing access to land of vulnerable
groups? Does government protect vulnerable groups of being deprived of their access
to land by third parties (male relatives, companies, landlords, etc.)? Does government
give access to land to the landless?

Are there sufficient incentives for investment in land improvements, including for tenants
and sharecroppers? How do law and practice deal with the rights of typical disadvantaged
groups like women, widows, migrants, herders, indigenous peoples, minorities? To what
extent does legislation enable or restrict land transfers and transactions, in particular rental
markets, as a means for people to access land, gain income and adjust their holdings of land
assets?

To what extent is this legislation and associated decrees easy to apply in practice? Is there a
large gap between legal provisions and what actually happens? Why? Does government have
the institutional capacity to implement the law? What is the role of the judiciary and the

49
Laad 462 - Land Policy and Reform

courts in resolving land disputes, settling land claims and how do they respond to these in
practice? Are farmers‘ organizations allowed to play a role in resolving land conflicts?

c. Institutional Framework for Land Administration Practices

Are responsibilities for carrying out land policy combined under one Ministry or distributed
amongst various sectoral Ministries? Which different sectoral ministries play a role in
dealing with land issues and delivery of land related services? How are these powers
exercised in practice? Are there a number of different specialist agencies responsible for e.g.
land administration, survey, land use planning, urban and rural or other categories of land?
How do the different land agencies relate to one another? Are the approaches taken by
different parts of government coherent, or do they operate in contradiction? Moreover, the
institutional framework analysis should cover the following issues:
 Land administration: How is the land tenure administrative system structured? What
are the principal functions and activities undertaken and by which bodies: issue of
title, management of land information, register of changes, adjudication, arbitration,
and conflict resolution, etc.? How effective and efficient are such bodies in practice?
Can they respond to the needs of different kinds of land rights holder, in terms of
accessibility, cost, appropriateness, etc.? What are the major limitations and problems
experienced with the delivery of land administration services?

 The roles of local government and traditional rulers: Has government administration
been decentralized and to what level? Is local government involved in land
management? Are their roles clearly defined? Does it have adequate financial and
human resources? How are customary rights managed? What is the role of customary
rulers, traditional authorities and institutions? Are they reliable, impartial and non-
discriminatory? Are they likely to respect the interest of the majority? What
incentives do they have to manage land in the interests of the local population and to
respect their rights? Are there checks and balances (e.g. through peer pressure, social
accountability or formal legislation) on the actions of customary or traditional
authorities?

 Financial aspects of reform: Do land policy and tenure reform feature in the
government‘s budgetary planning and what are the expected financial implications of
carrying through the proposed measures and interventions relating to land? Have
different options been assessed/ cost?

3.5.2. Analysis of Opportunities for Changes in Land Reform

In order to identify possible policy interventions it is necessary to assess the entry points
beforehand and identify any ongoing processes and opportunities for the design and
implementation of a new land reform policy. The issues needed to be analyzed in this part
include issues such as the ongoing reform processes, stakeholder participation, emerging
pressures, and political factors, government commitment, donor support and available
research

3.5.3. Analysis of Sustainability of Land Reform

The different aspects of sustainability, more importantly the three pillars of sustainable
development; economic, social and environmental issues should be given more emphasis in
the process of land reform design.
a. Financial sustainability: Analysis of financial sustainability deals with the cost of
land reforms and the land administration system and the capacity for Government and
users to cover the recurrent and investment costs incurred:

b. Institutional Sustainability: A sound land policy requires appropriate institutions to

enable and monitor its implementation and to provide security to land users, allocate
and deliver land rights, and provide services required to facilitate and record
transactions. The role of institutions should be regulate land use and act as an honest
broker in the case of conflicts.78 Therefore, the success of land reform policy most
often rely on local institutions and reinforce their role to ensure beneficiaries‘
participation in the management of land rights.

c. Environmental Sustainability: Land reforms are powerful tools to improve natural

resource management and reduce soil fertility decline. However, for land reforms to
contribute meaningfully to improve natural resource management objectives relating
to environmental sustainability must be built into the reform program from the start
and tradeoffs such as those between agricultural productivity and land management
must be openly addressed.

3.5.4. Analysis of Social Impact of the New Land Reform Policy

Given the importance of land as a productive asset, land reform can have massive impact on
social relations both at the level of the communities and at level of the household. At the
level of communities land reform modifies the relationships amongst land users, between
land owners and workers or tenants, and between traditional rulers, national/local
administrations and individuals. Land reform has also an impact at household level by
modifying the relations between men and women or between generations.79 Therefore, the
analysis in this respect should have to cover the following issues:
 To what extent the reform process allows to bridge the gap between legacy,
legitimacy and practices and to provide effective support and legal protection to the
rights of farmers and herders?
 Will the land policy reform effectively rule out forced evictions? Is the land policy
reform sufficient to effectively protect the land rights of vulnerable groups from

78
Ibid.
79
Ibid.

51
Laad 462 - Land Policy and Reform

threats by third parties? To what extent the reform process allows to overcome
landlessness?
 How does the land policy take into account the specific needs of women? Are women
allowed to own land and acquire a title? Are they consulted on the content and
involved in the implementation of the reform?
 Does the reform respect the rights of ethnic minorities and indigenous peoples? Does
the reform adequately cater for the needs of landless people and the poor?

3.6. Monitoring and Evaluation Indicators

Indicators are tools to measure the extent to which the new land reform is meeting stated
objective. They are by nature very case specific. The list provided below is not exhaustive
and is intended only to serve as a guide to define a specific set of indicators relevant in the
national context. The newly designed and implemented land reforms can be evaluated from
the four aspects and changes that are expected from the introduction of a new land reform
policy.80 These features that should be included as monitoring and evaluation indicators are
tenure security, land market, environmental impact and financial benefit and cost. The
specific indicators that are part of major indicator are listed below.

3.6.1. Tenure Security Indicators

The issues in this category of evaluation should have to cover the following elements:
 Trends in land ownership, access and utilization by both men and women;
 Equity of land distribution, number of landless and related issues;
 Share of land (number of parcels and total area) registered individually and
communally;
 Cost of registration (time and money) to land owners/communities and duration
of registration process;
 Level of protection of rights of indigenous peoples, pastoralists, minorities;
 Number and extent of land conflicts in a given time;
 Prevalence of forced evictions, land grabbing and illegal appropriation of land;
 Existence and effectiveness of dispute resolution mechanisms; and
 Existence of appeal mechanisms.

3.6.2. Land Market Indicators

 Development of a land market: number and volume of transaction;
 Relative price of land for different categories;
 Comparison with agricultural profits;
 Differences between rural and urban land;
 Evidence of land fragmentation, average size of plots;
  Availability of information on land prices;
 Equity of inheritance laws/regulations in particular to women;
 Level of informal land transactions;
 Restrictions to land sales both administrative and on price;
 Cost (time and money) of a land transaction; and
 Existence of mortgage financing for the purchase of land.

3.6.3. Environmental Impact and Natural Resources management indicators

 Trends in land degradation or desertification;
 Agricultural productivity in marginal lands;
 Size of protected areas or extent of encroachment;
 Protected areas under sustainable community management.

3.6.4. Regulatory Framework Indictors

 Land tax rates, collection and use;
 Land tax collection efficiency;
 Information on the use of taxes;
 Existence and timely availability of cadastral information (registry/maps;
 Cost of cadastral service to user and as a percentage of the actual cost of the
service; and
 Number and duration of court cases.

Activity 3
1. How do political economists and neo-liberals look at market led reform?
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2. What are the criticisms of political economy and neo-liberal approaches to land
reform?
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3. Explain the limitations of neo-liberal approaches to land reform?

80
Ibid.

53
Laad 462 - Land Policy and Reform

-------------------------------------------------------------------------------------------------------
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4. What are the advantages and disadvantages of the actor oriented perspective?
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Dear Student! Have you answered the above questions? If your answer is no, please reread
the sub-section and try to answer those questions again. If your answer is yes, very good, go
to the next section.
UNIT 4: REDISTRIBUTIVE LAND REFORM

UNIT OVERVIEW
Dear student! Welcome to the fourth unit of this course. In this unit, we will try to introduce
you with some fundamental concepts about redistributive land reform. Redistributive land
reform is a public policy that transfers property rights from large private landholdings to
small farmers and landless farm workers with the aim to share land between different groups
in a given society fairly.

UNIT OBJECTIVES
After completing this unit, you will be able to:

 Describe about land redistribution;

 Understand about the importance of land redistribution;
 Identify preconditions for successful implementation of redistributive land reform;
 Explain the most important considerations and determinates in the redistributive land
reform process;

4.1. Basic Concepts of Redistributive Land Reform

Redistributive land reform conventionally refers to a public policy that transfers property
rights from large private landholdings to small farmers and landless farm workers.81
Redistribution of land in other words is changing the relative shares land between different
groups in a given society. Applied to property rights, redistributive land reform means the net
transfer of wealth and power from the landed to landless poor classes.82

Redistributive land reform is a qualitative change in the way states allocate public
land/resources to large land less social groups.83 Implicitly and explicitly, redistributive land
reform dissolves non-private lands (such as public/state or ‗communal‘ lands). The
81
GRIFFIN, K., KHAN, A. R. & ICKOWITZ, A. 2002. Poverty and the Distribution of Land. Journal of Agrarian
Change, Vol.2 No.3, pp. 279–330.
82
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
83
Ibid.

55
Laad 462 - Land Policy and Reform

underlying assumption in the dominant land reform literature is that lands that are officially
classified as ‗public/state‘ properties, especially those used to open up resettlement areas, are
lands that are generally not cultivated and inhabited, and are without pre-existing private
control. Therefore, public/state and communal lands are potentially paying grounds for
redistribution of land to the landless groups of the society.

Much of the lands in many developing countries today that are defined as ‗public‘ in public
policy practice do not actually fit the basic criteria used in theory to define public land. In the
conventional land reform literature, ‗public‘ lands are defined as unproductive and
uninhabited lands without existing land-based production and distribution relationships. In
fact, in many agrarian settings, public and private lands are differentiated from each other
only by their formal property rights categories; both land types in reality have developed
comparable pre-existing land-based production and distribution relationships and even farm-
productivity levels over time historically.

Redistributive land reforms are aimed precisely at adjusting pre-existing social and
production relationships by transferring the effective control over land-based wealth and
power from the landed to the landless and near-landless classes, regardless of whether the
land in question is officially classified as private or public. To be truly redistributive, a land
reform must effect on a pre-existing agrarian structure a change in ownership of and/or
control over land resources wherein such a change flows strictly from the landed to the
landless classes or from rich landlords to poor peasants and rural workers.84 Since ownership
and/or control over land resources means the effective control over the nature, pace, extent,
and direction of surplus production and distribution. In other words, land redistribution aims
to create ―purposive change‖ that can result in the improvement of the situation of the
landless and land-poor peasants and rural workers. Such purposive change or ―reform‖ is
inherently relational: it must result in a net increase in poor peasants‘ and rural workers‘
power to control land resources with a corresponding decrease in the share of power of those
who used to have such power over the same land resources and production processes.
Therefore, land redistribution is essentially wealth and power redistribution.

Moreover, theoretical reasons and empirical evidence suggest that land reform may provide
equity and efficiency benefits.85 A large body of research has demonstrated the existence of a
robustly negative relationship between farm size and productivity due to the supervision cost
associated with employing hired labor.86 This implies that redistribution of land from wage-

84
Ibid.
85
DEININGER, K. 1999. Making negotiated land reform work: Initial experience from Colombia,
Brazil, and South Africa. World Bank Policy Research Working Paper 2040.
86
Ibid.
operated large farms to family-operated smaller ones can increase productivity.87 In addition,
access to assets in general and land ownership in particular is associated with improved
access to credit markets and can provide benefits as an insurance substitute to smooth
consumption resources inter-temporally.88

4.2. Nature and Extent of Redistributive Land Reform

Redistributive reform, in terms of its nature and extent, is essentially a matter of degree and
context dependent. The redistributive nature of a land reform transaction in a given
landholding, and the change that it causes in the relative shares between the landlord on the
one side and the peasants on the other side, is seldom either one hundred percent
redistributive or one hundred percent non-redistributive; it is usually somewhere in
between.89 The extent to which redistributive land reform is implemented in a given society
is also context dependent, with redistributive outcomes seldom being all or nothing.

Traditionally, two interrelated elements have defined the redistributive character of a land
reform policy, namely, the compensation to landlords and the payment made by peasants. On
the one hand, compensation to the landlord can be between zero and somewhere below the
―market price‖ of the land; the difference between the ―market price‖ and the actual
compensation partly defines the degree of redistribution. On the other hand, the payment
made by peasants and rural workers for the land can be between zero and somewhere below
the acquisition cost, with the difference between the two also partly defining the degree of
redistribution.

The above framework shows that in reality a land transfer program/policy does not constitute
redistributive land reform where the landlord is paid one hundred percent spot-cash for one
hundred percent (or higher) of the ―market value‖ of the land and where the buyer shoulders
one hundred percent of the land cost, including the sales transaction costs. Such is a simple
capitalist real estate transaction which, of itself, is highly unlikely to favor the landless rural
poor. Exchange of goods and money in the market between sellers and buyers is not the same
as, nor does it necessarily constitute, pro-poor redistribution of wealth and power.90

The two minimum requirements for redistributive land reform, namely, compensation to
landlords at below market price and payment by peasants and workers at below actual

87
BINSWANGER, H. P., DEININGER, K. & FEDER, G. 1993. Power, Distortions, Revolt, and Reform in
Agricultural Land Relations.World Bank Policy Research Working Paper 1164.
88
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank
and Oxford University Press.
89
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
90
Ibid.

57
Laad 462 - Land Policy and Reform

acquisition cost must, in turn, be linked to the principle that land is not a simple economic
factor of production.91 Rather, land has a multidimensional function and character, that is, it
has political, economic, social, and cultural dimensions. In fact the ―value‖ of land cannot be
reduced to strictly monetary terms, and so the ―market price‖ of a parcel of land is actually a
contested notion involving political-economic and socio-cultural factors that, themselves,
depend on who is attaching the value to the land. The notion of land having a
multidimensional character (i) provides the basis for bringing in issues imbued with value
judgment such as ―social justice,‖ ―social function of the land,‖ ―purposive change,‖ and
―empowerment,‖ which cannot be understood in purely monetary terms and (ii) inherently
requires the intervention of the state to achieve the desired multiple goals of land reform
policy. Thus, landlord compensation–related mechanisms ranging from land confiscation
without compensation to expropriation with compensation at below market prices (usually
inflation adjustment is not factored in) are also largely determined, and should also be
determined, by non-economic factors such as socio-historical circumstances and the politics
of pre-existing land monopoly and reform. The same consideration applies in determining the
level of peasants‘ and workers‘ payment. Hence, the multidimensional character of land
renders the monetary-based valuation method an important but incomplete way to assess the
land‘s actual and full value.

The conceptual clarification that land reform is about redistribution of wealth and power
necessarily implies and requires that analysis of the current land reform, existing conditions
rather than rely wholly and uncritically on what the official data claim or convey. This is
because dynamic land-based production and distribution relationships that are essentially
power relations are the very subject of reform and cannot be fully and properly captured by
static official statistics alone.92 Moreover, the contemporary literatures on property
management, especially in light of popular calls for decentralization and self-governance,
correctly criticized the conventional theory on idealized models of private property and state
property.93 The conventional and traditional concept of private property is conceptualized
narrowly with a primary focus on the right to alienate through sale or inheritance as the
defining attribute of private property. In the new concept of property right different types of
claims made over different types of rights over various resources. These rights include the
right of access, withdrawal, management, exclusion, and alienation.94 Only a full owner has

91
Ibid.
92
Ibid.
93
COLE, D. H. & OSTROM, E. 2012. The Variety of Property Systems and Rights in Natural Resources. In: COLE,
D. H. & OSTROM, E. (eds.) Property in Land and Other Resources, Lincoln Institute of Land Policy. OSTROM, E.
1999. Private and Common Property Rights. Workshop in Political Theory and Policy Analysis and Center for
the Study of Institutions, Population, and Environmental Change, Indiana University. SCHLAGER, E. & OSTROM,
E. 1992. Property Rights Regimes and Natural Resources: A Conceptual Analysis. Journal of Land Economics,
Vol. 68, No.3, pp 249-262.
94
SCHLAGER, E. & OSTROM, E. 1992. Property Rights Regimes and Natural Resources: A Conceptual Analysis.
Journal of Land Economics, Vol. 68, No.3, pp 249-262.
the complete set of the enumerated rights, while other types of claimants have varying rights
or combinations thereof, but not alienation. Schlager‘s & Ostrom‘s,1992, schema is a
powerful critique of the conventional wisdom founded on the simplistic conception of
property rights that refers mainly to the right to alienate. Therefore, the success of
redistributive land reform requires a detail understanding of the and characteristics of
property systems.

4.3. Redistributive land Reform on public and private lands

4.3.1. Views of Redistributive Land Reform on Public Land

According to the conventional definition, redistributive land reform is a public policy that
transfers property rights over large private landholdings to small farmers and landless farm
workers.95 The universally accepted definition, implicitly and explicitly, excludes non-
private lands (i.e., ―public,‖ ―state,‖ or ―communal‖ lands).96 The underlying assumption in
the dominant land reform literature is that lands that are officially classified as ―public/state‖
properties, especially those used to open up resettlement areas, are lands that are generally
not cultivated and inhabited and are without pre-existing private control. In such conditions,
it is logical to conclude that land policies that concern these lands do not affect or change any
land-based production and distribution relationships.97 Yet, it becomes problematic when the
use of the same lens is stretched as far as to examine ―public‖ lands that are in fact under
varying degrees of cultivation, imbued with private interests, and marked by production and
distribution relationships between the landed and the landless and land-poor, between the
elite and non-elite interests and relationships that are often not captured by official census.

There are two contrasting views on redistributive land reform on public land. In most land
reform literatures, land reform policy which is directed to and implemented in public lands is
referred to as public settlement program or colonization. Many scholars, activists, and
policymakers simply assume that such a policy does not alter pre-existing distributions of
wealth and power in society, hence does not constitute and promote redistributive reform,
and therefore is politically non-contentious. For example, to settle people on new land and to
develop it for agricultural use does not involve any basic alteration of the property rights of
existing landowners; hence a public-land settlement program will generate no opposition
from the landed class.98 On the other hand directed resettlement or colonization patterns on
public/state lands or on a small number of formerly private farms frequently have little to do

95
GRIFFIN, K., KHAN, A. R. & ICKOWITZ, A. 2002. Poverty and the Distribution of Land. Journal of Agrarian
Change, Vol.2 No.3, pp. 279–330.
96
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
97
Ibid.
98
LIPTON, M. 2009. Land Reform in Developing Countries : Property rights and property wrongs, New York,
Routledge.

59
Laad 462 - Land Policy and Reform

with making overall resource or income distribution more egalitarian: only a few settlers
benefit.

When we look at public lands from the ―bottom up,‖ in terms of demographic and agro-
economic conditions, it has two broad categories, namely, uninhabited and idle land on the
one side and populated and cultivated land on the other side.99 The former (uninhabited and
idle land) is what most land reform scholars refer to simply as ―public land.‖ In this context,
their argument that land policies here do not constitute redistributive reform (or could even
be a ―counter-reform‖) may be accepted as valid and unproblematic.

For the second type of public land that is populated and cultivated, the conventional
assumptions in the land reform literature emerge as so problematic as to require
rethinking.100 Many of these lands have pre-existing inhabitants and productive activities and
property relations and claims. Despite official classification as public, these lands have been
the object of complex overlapping and conflicting private land claims that have subsequently
emerged and that are not easy to untangle or resolve. Therefore, the implementation of state
redistribution programs, for example, would impact on the pre-existing communities and
property relations in these lands. The concentration of population in planned settlements may
not create what state planners had in mind, but it has almost always disrupted or destroyed
prior communities whose cohesion derived mostly from non-state sources.

Therefore, implementation of redistributive land reform policy in public lands requires

further understanding of the nature and variables of public land. Directing land redistribution
in public lands without a detail investigation may divert the intended outcomes of the reform
into unplanned. It may also lead to public opposition.

4.3.2. Redistributive Land Reform on Private Lands

Redistributive land reform on private land according to most scholars is inclined to accepting
―land transfers‖ on private lands via the voluntary offer-to-sell (VOS) and voluntary land
transfer (VLT).101 However, the implementation of redistributive land reform on private land
is not free from critiques and direct state intervention.

Evidence from most Latin American, Asian and African countries elucidates this problem.
Implementation of redistributive land reform on private lands has also a number of
challenges. For example if it is:102

99
BORRAS, S. M. 2007. Pro-poor land reform : a critique. , University of Ottawa Press.
100
Ibid.
101
Ibid.
102
Ibid.
  Relied on uncritical stance toward the officially reported accomplishment data on
private lands and carried out within a conventional state-driven land reform policy
that are simply ―on-paper‖ land transfers where in reality reforms never took place;
 If it is intra-family land transfers that intended to evade expropriation, manipulated‖
land transfer processes, and overpriced land transfer transactions that have a net effect
of securing the effective control over land resources in the hands of the landlord or
corporate elite or even achieve a net transfer of wealth from the poor to the rich.
 It is true that expropriationary land reforms can, under certain conditions, force and
have in some cases actually forced some landlords to sell their lands under the
government land reform program and to bargain for better compensation schemes.
But this happens through VOS and not via VLT.
 Another view of redistributive land reform on private lands is the relative weakness in
the critical examination of neoliberal land reform that is founded on the voluntary,
―willing seller, willing buyer‖ land sales principle

4.4. Functions of Redistributive Land Reform

Redistributive land reform as it is defined above is the reallocation of rights to establish a

more equitable distribution of land and it is a powerful strategy for promoting both economic
development and environmental quality.103 Redistributive land from can function as a tool to
attain a more sustainable development.

Dozens of redistributive land reform programs were carried out after WW II. In looking back
at the successes and failures, we can distinguish between what might be called 'genuine‘
redistributive land reforms and the more 'window dressing' or even 'fake' reforms. When a
significant proportion of quality land was really distributed to a majority of the rural poor,
with trade, macroeconomic and sectoral policies favorable to successful family farming in
place, and when the power of rural elites to distort and 'capture' policies was broken, the
results have invariably been real, measurable poverty reduction and improvement in human
welfare. The economic successes of Japan, South Korea, Taiwan, China and Cuba resulted
from such reforms. In contrast, when 'reforms' gave only poor quality land to poor families
and failed to support them with favorable policies, credits, prices and access to markets, or
failed to alter the rural power structures that work against the poor, land reform failed to
affect broad-based changes is known as 'window dressing' or 'fake' redistributive land
reforms. Failed reforms are often characterized by marginalization of poor from national
economic life, as they frequently assumed heavy debts to pay for the poor quality land they
received in remote locations without credit or access to markets and in policy environments
hostile to small farmers.
103
BOYCE, J. K., ROSSET, P. & STANTON, E. A. 2005. Land Reform and Sustainable Development. Political
Economy Research institute working paper No.98, University of Massachusetts.

61
Laad 462 - Land Policy and Reform

The more successful and genuine reforms triggered relatively broad-based economic
development. By including the poor in economic development, they built domestic markets
to support national economic activity. Genuine redistributive land reforms can play important
roles in the move toward more sustainable development.104
 It is means for poverty reduction
 It is a means to increase productivity
 Encourages Economic Development
 It is a means to Environmental protection

4.4.1. Redistributive Land Reform and Poverty Reduction

It is obvious that the re-distribution of land to landless and land-poor rural families can be a
very effective way to improve rural welfare.105 When we say redistributive land reform is a
tool for rural poverty reduction we have to carefully distinguish between what is known as
'radical' re-distribution (called 'genuine land reform' and 'non-egalitarian' reforms (or 'fake
land reform'). When quality land is really distributed to the poor, real, measurable poverty
reduction and improvement in human welfare has invariably been the result. By expanding
and securing the land rights of the poor, land reform adds to their wealth and thereby reduces
asset poverty. This, in turn, helps to reduce income poverty in two ways: first, by increasing
the poor‘s share in the agricultural income pie; and second, by increasing the total size of the
pie.106

The first effect is straightforward. Assets are stocks of wealth, and these generate flows of
income. By redirecting an important flow – the returns to land – into the hands of the poor,
progressive land redistribution augments their incomes. At the same time, assets enhance a
person‘s social status and political power. Land reform reduces these ‗non-economic‘
dimensions of poverty, too. The second effect is more complicated, and less certain. In the
short run, land reforms can have ‗transaction costs‘ that reduce agricultural output,
particularly if accompanied by political instability that disrupts input supplies or access to
markets. Moreover, it may take some time for the beneficiaries to learn how best to manage
their new assets. But in the long run, land reforms can increase the size of the agricultural
income pie by promoting more labor- intensive farming. In other words, land reform can be a
‗win-win‘ strategy that improves both equity and efficiency.107

104
Ibid.
105
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank and
Oxford University Press.
106
BOYCE, J. K., ROSSET, P. & STANTON, E. A. 2005. Land Reform and Sustainable Development. Political
Economy Research institute working paper No.98, University of Massachusetts.
107
Ibid.
4.5.2. Redistributive Land Reform and Productivity
Evidence from around the world demonstrates that small, owner-operated farms typically
produce more output per acre than large farms cultivated by means of wage labor or tenants.
A recent report on the relationship between farm size and total output in fifteen countries in
the global South found that in all cases relatively smaller farms were more productive per
unit area, by a factor of two to ten times.108 This shows that small farms can produce far
more agricultural output per unit area than larger farms, and do so more efficiently. This is
widely recognized by agricultural economists as the "inverse relationship between farm size
and output‖.109

This higher output per acre in small farms takes four forms:110
i. Higher cultivation intensity: In any given year, small farms tend to cultivate a bigger
percentage of their land than do large farms. While, large farms often leave a
substantial proportion of their lands uncultivated;

ii. Higher cropping intensity: Likewise, small farms tend to have a higher cropping
intensity; that is, they grow more crops per year on a given piece of land.
iii. Higher-value crop mix: Small farms also tend to grow crops that are higher-value
and more labor- intensive than those grown on large farms. The cultivation of
vegetables, for example, usually requires much more labor per acre than the
cultivation of grains; at the same time, vegetable cultivation yields much greater
value per acre.
iv. Higher yields per acre: Finally, small farms often get higher yields per acre for any
given crop, simply by virtue of putting more time and care into their farming. While it
is not negligible, this differential generally is less important to overall land
productivity differences than the other three.

4.5.3. Redistributive Land Reform and Economic Development

Surely producing more tons of grain is not the only goal of farm production; farm resources
must also generate wealth for the overall improvement of rural life-including better housing,
education, health services, transportation, local economic diversification, and more
recreational and cultural opportunities. Redistributive land reform is also an important tool to
generate an overall economic activity and growth.111 As a broad base of agricultural families
benefiting from land reform receive higher incomes, they enter the marketplace to purchase

108
ROSSET, P. M. 1999. The Multiple Functions and Benefits of Small Farm Agriculture : In the Context of
Global Trade Negotiations. Institute for Food and Development Policy, Policy Brief No.4, Oakland, USA.
109
DEININGER, K. 2003. Land Policies for Growth and Poverty Reduction Washington DC, World Bank and
Oxford University Press.
110
BOYCE, J. K., ROSSET, P. & STANTON, E. A. 2005. Land Reform and Sustainable Development. Political
Economy Research institute working paper No.98, University of Massachusetts.
111
PROSTERMAN, R. L. & HANSTAD, T. 2000. Land Reform: A Revised Agenda for the 21st Century. Rural
Development Institute RDI Reports on Foreign Aid and Development No.108, Seattle, Washington.

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Laad 462 - Land Policy and Reform

goods and services, ranging from improved housing to schoolbooks, from bicycles to sewing
machines. This increased demand stimulates the creation of nonfarm employment. Thus, a
dynamic agriculture has significant forward and backward linkages to broader societal
development. Research confirms that a broad-based distribution of land assets not only
benefits the poor, but becomes a solid basis for sustained and inclusive economic growth.

In most land reform studies a question of what does the growth of large-scale, industrial
agriculture mean for rural towns and communities was raised. A comparison was made
between small and large scale farms on the roles of the overall improvement of rural life. The
findings of the comparison show that farming communities dominated by large corporate
farms, nearby towns died off. Mechanization meant that fewer local people were employed,
and absentee ownership meant that farm families themselves were no longer to be found. In
these corporate-farm towns, the income earned in agriculture was drained off into larger
cities to support distant enterprises, while in towns surrounded by family farms, the income
circulated among local business establishments, generating jobs and community prosperity.
Where family farms predominated, there were more local businesses, paved streets and
sidewalks, schools, parks, churches, clubs, and newspapers, better services, higher
employment, and more civic participation

4.5.4. Redistributive Land Reform and the Environment

The benefits of small farm economies extend beyond the merely economic sphere. Whereas
large, industrial-style farms impose a scorched-earth mentality on resource management -- no
trees, no wildlife, endless monocultures -- small farmers can be very effective stewards of
natural resources and the soil. To begin with, small farmers utilize a broad array of resources
and have a vested interest in their sustainability. At the same time, their farming systems are
diverse, incorporating and preserving significant functional biodiversity within the farm. By
preserving biodiversity, open space and trees, and by reducing land degradation, small farms
provide valuable ecosystem services to the larger society.

Therefore, redistributive land reform is not only is compatible with sustainable agriculture,
but also can help to promote it and a means to preserve the environment. There are four
reasons to believe that small farms are more environment friendly than those large farms.112

 First, environmentally beneficial land-use practices are often more labor-intensive

than environmentally costly land abuse. For example, manual weed control takes
more labor than using herbicides. Integrated pest management often is more labor-
intensive than simply blasting the fields with insecticides. Similarly, applying bulky
organic manures takes more work than applying concentrated chemical fertilizers.

112
BOYCE, J. K., ROSSET, P. & STANTON, E. A. 2005. Land Reform and Sustainable Development. Political
Economy Research institute working paper No.98, University of Massachusetts.
 Small farms have a comparative advantage in these and other labor- intensive
practices for the reasons discussed above, and this translates into a comparative
advantage in environment- friendly farming.

 Second, intimate knowledge of the local environment – including soils, weather, crop
varieties, insects, and plant diseases – is a key input in sustainable agriculture. A
dichotomy between the ownership of land and labor on it often leads to a dichotomy
between decision making and local knowledge. Absentee landowners, in particular,
generally lack the accumulated knowledge of small- scale family farmers.

 Third, small farmers not only have greater ability to care for the land; they also have
greater willingness to do so. As owners of the land, they clearly have a stronger
incentive to maintain its long-term productivity than do tenant farmers or hired
laborers. Apart from self- interest, the ownership of the land often instills a moral
sense of duty to safeguard it. For family farmers, land is not just another input: it is an
asset to be passed to future generations.

 Finally, farmers who cultivate the land by means of their own family‘s labor have a
much stronger incentive to worry about occupational health and safety, including
exposure to toxic pesticides. The people who bear the highest costs from
environmentally destructive farming practices often are those who toil in the fields. In
farming as other occupations, protecting workers‘ health goes hand- in- hand with
protecting the environment.

Compared to the ecological wasteland of a modern export plantation, the small farm
landscape contains a myriad of biodiversity. The forested areas from which wild foods, and
leaf litter are extracted, the wood lot, the farm itself with intercropping, agro-forestry, and
large and small livestock, the fish pond, the backyard garden, allow for the preservation of
hundreds if not thousands of wild and cultivated species. Simultaneously, the commitment of
family members to maintaining soil fertility on the family farm means an active interest in
long-term sustainability not found on large farms owned by absentee investors. Therefore, if
we are truly concerned about sustainable development and rural ecosystems, then the
preservation and promotion of small, family farm agriculture is a crucial step we must take.

65
Laad 462 - Land Policy and Reform

Activity 4
1. What is redistributive land reform? Explain.
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2. Explain the difference between state-led redistributive land reform and market based
redistributive land reform.
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3. Explain the difference between genuine and fake redistributive land reforms.
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4. What is public land? Explain.
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5. Explain how redistributive land reforms serve as a tool for sustainable development.
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Dear student! Have you answered the above questions? If you couldn‘t answer the above
questions, please read this unit again before you proceed to the next unit.
UNIT 5: LAND RESTITUTION

UNIT OVERVIEW
Dear student! The fifth unit of this course deals with land restitution by which land and other
property that was forcibly removed from its owners is restored or compensation of equivalent
value provided. Thus, this unit discusses the importance of land restitution as well as
different mechanisms of restoring previous owners to their original place.

UNIT OBJECTIVES
After completing this unit, you will be able to:

 Define land restitution;

 Understand about the importance of land restitution;
 Identify preconditions for successful implementation of land restitution;
 Compare and contrast the different mechanisms of restoring previous land owners to
their original place.

5.1. Basic Concepts of Land Restitution

Land restitution is the process by which land and other property that was forcibly removed
from its owners is restored or compensation of equivalent value provided.113 Land may have
been forcibly removed from its owners in a variety of circumstances. Collectivist
governments expropriate land so that individual ownership is replaced by ownership by the
state. Colonization can result in land possessed or controlled by native peoples being granted
to colonists, for example, as farms. Wars and internal conflicts can result in peoples being
driven off their land, for example, through ethnic cleansing, or the ownership of land,
formerly possessed by the vanquished, being granted to the victors. None of these processes
are new and have been going on throughout human history. What is relatively new is that
during the past two decades some governments have adopted restitution policies to reverse
past expropriations.

Restitution is an equitable remedy under which a person is restored to his original position
prior to loss or injury, or placed in the position he or she would have been. It is aimed at
enabling former landholders to reclaim spaces and territories which formed the basis of
113
GROVER, R. & FLORES-BÓRQUEZ, M. 2004. Restitution and Land Markets. Impact of New Land Law and
Land Reform Law on Good Land Administration. Athens, Greece, May 22-27, 2004.

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Laad 462 - Land Policy and Reform

earlier identities and livelihoods. Drawing on memories and histories of past loss, individual
claimants and informal movements and governments or non-governmental organizations
(NGOs) working on their behalf – have attempted to restore and reclaim their rights. Land
restitution thus brings the past into the present.114

Restitution as land reform is important for two main reasons.115 Firstly, from an economic
point of view, it has significant implications for the functioning of the property markets in
the countries where it occurs, including an impact on foreign investors, who have invested in
real estate. It means that owners, who previously thought they had good title to a property, no
longer enjoy this. The wealth of the previous owner is destroyed or, at least, reduced.
Restitution is therefore associated with the redistribution of wealth. Often the owner, who
had previously enjoyed good title, is the state and the new owner is a private individual.
Restitution is therefore one of the means by which private property markets and individual
decision-making over real estate has been created in transitional economies.

Secondly, restitution can have important socio-political consequences. Expropriation

involves the denial of human rights and is often associated with other violations of these.
Restitution can be used as a means of achieving closure to conflicts. Their settlement can
involve the restoration of property to those who have been dispossessed. Restitution can
enable refugees and internally displaced persons to return home. Without restitution, they
may have no home to return to. Restitution is one means by which the perpetrators of human
rights abuses can make reparation and undo some of the harm that has been done. The key
issue in such circumstances is how to achieve a sufficient measure of support from all those
involved so that the conflict can be resolved.

The main purpose of land restitution is correcting and righting past injustices and
violations.116 Land restitution policies have to do with the need to make correction of the
past, solve or rectify unfair situations. These correction must be fitting with the own political
objectives of a country. It is concerned with the policy of providing land to those whose real
estate was forcibly removed without receiving adequate compensation. It has to do with
situations in which one group has unjustly enriched itself at the expense of other groups or
individuals, through the forcible removal of property from its owners. And it is also
concerned with the recognition of property rights of minorities such as indigenous people
who have their own way and right to use and usufruct the land that has belonged to them
since long time in history.

114
FAY, D. & JAMES, D. 2009. Restoring what was ours’ : An introduction. In: FAY, D. & JAMES, D. (eds.) The
Rights and Wrongs of Land Restitution. New York: Routledge-Cavendish.
115
GROVER, R. & FLORES-BÓRQUEZ, M. 2004. Restitution and Land Markets. Impact of New Land Law and
Land Reform Law on Good Land Administration. Athens, Greece, May 22-27, 2004.
116
FAY, D. & JAMES, D. 2009. Restoring what was ours’ : An introduction. In: FAY, D. & JAMES, D. (eds.) The
Rights and Wrongs of Land Restitution. New York: Routledge-Cavendish.
The forcible removal of property and the resulting unjust enrichment of a group or individual
can happen in a variety of ways, including:
 Ethnic cleansing in which a social group is driven from its property;
 Forced sales at below market prices;
 Treaties in which land transfer was not the result of informed consent as one party
had different concepts of land rights from the other;
 Colonization
 Collectivization so that individual property is expropriated and replaced by ownership
or control by the state or collective organization
 The dispossession of the vanquished in a war, civil war or internal conflict by the
victors
 The dispossession of those branded as the enemies of the state or of society

The equitable principle in contracts and quasi contracts is that one party shall not unjustly
enrich itself at the expense of another. The party that has unjustly enriched itself may be
obliged to make restitution to the other party. In principle, the party who has been unjustly
enriched could be either the vendor or the purchaser. However, in situations in which
governments have adopted restitution policies, it is normally the "vendor" who is
compensated on the grounds that it was his property that was unjustly expropriated through
an enforced transfer. The key to the notion that restitution is an appropriate response is that
the enrichment of one party has been unjust.117

Land restitution may also have unofficial purposes: establishing the legitimacy of a new
regime, quelling popular discontent, or attracting donor funds.118 Likewise, it may produce
unintended consequences. Notions of property and ownership may be transformed, local
bureaucracies may be entrenched, spatial patterns of land use that replicate older patterns of
racial and economic segregation may be reinstated or consolidated. Moral discourses about
righting past injustice through restitution may obscure its exclusionary aspects or its
tendency to reinforce existing forms of social differentiation.

5.2. Driving Forces of Restitution

The main driving force for a country to design and implement a restitution policy is
concerned mainly with social justice. In addition to past social injustice, land restitution is a
policy that is taking place in several countries in the world with different driving forces that
117
GROVER, R. & FLORES-BÓRQUEZ, M. 2004. Restitution and Land Markets. Impact of New Land Law and
Land Reform Law on Good Land Administration. Athens, Greece, May 22-27, 2004.
118
FAY, D. & JAMES, D. 2009. Restoring what was ours’ : An introduction. In: FAY, D. & JAMES, D. (eds.) The
Rights and Wrongs of Land Restitution. New York: Routledge-Cavendish.

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Laad 462 - Land Policy and Reform

goes from recognition of indigenous and rights of minorities to moving from command
economy to market economy. For any country, the motives or designing and implementing a
land restitution policy are emanated from one of the following factors:

i. Recognition and protection of indigenous land rights:

Indigenous rights in the past decades have been a matter of continental and international
discussion. Latin American many countries have been recognized as multi ethnic and
multicultural societies that provide special protection for indigenous lands. In the ILO
indigenous and Tribal Peoples Convention N. 169 on land and other related issues states that
the states must:119

a. Identify indigenous lands and guarantee the effective protection of rights of

ownership and possession.
b. Safeguard indigenous right to participate in the management and conservation of
resources.
c. Consult with indigenous peoples over mineral and surface resource development and
any policy that could affect them.
d. The possession and property right will have to be recognized the towns interested on
the land or territory that they had traditionally occupy.

ii. Internal Displacement of People

The property rights of displaced people are protected by international law. The property is
protected from destruction and illegal appropriation which could end in a restitution of
Property rights. The reasons that motivate the displacement of people are many: could be
policies of apartheid or ethnic cleansing, armed conflict, large-scale development projects, in
cases of disasters or when it is used as a collective punishment. In the United Nations
Guiding Principles on Internal Displacement, the protection of property rights are clearly
stated in the following way:120

a) No one shall be arbitrarily deprived of property and possessions.

b) The property and possessions of internally displaced persons shall in all
Circumstances be protected, in particular, against the following acts:
 Pillage;
 Direct or indiscriminate attacks or other acts of violence;
 Being used to shield military operations or objectives;
 Being made the object of reprisal; and
 Being destroyed or appropriated as a form of collective punishment.

119
ILO 1989. Indigenous and Tribal Peoples Convention N. 169 , The General Conference of the International
Labour Organisation.
120
UN 1998. Guiding Principles on Internal Displacement, United Nations Economic and Social Council.
 c) Property and possessions left behind by internally displaced persons should be
protected against destruction and arbitrary and illegal appropriation, occupation or
use. Moreover, emphasis should be given to the causes of displacement. Only the
guarantee of the end of the causes that motivate the displacement and the security of
displaced people to return to the place they left and the restitution of their property
rights could ensure their right to return home.121

iii. Environmental Protection

This driving force is very much related to the right and recognition of indigenous land
rights and the right they have to claim back the lands they once owned. There are three
main conceptual approaches to indigenous land rights. These are:
i. Protective approach: indigenous people need special protection;
ii. Right based approach: indigenous people have special rights to land and
resources under the parameter of multicultural and multiethnic states; and
iii. Environmental approach: argues that indigenous people have great capacity to
manage natural resource in fragile areas. The environmental approach takes the
protection of the environment as its main point, some environmentalists see
indigenous people as the best keepers or protectors of the rain forest and fragile
ecosystems. It is recognized as a special value the relationship indigenous people
have developed with the land, not seen a commodity but it is recognized as a
special value.

The UN Declaration on Indigenous Rights reiterates the preference for restitution of land
(Article 27) states that:

“Indigenous peoples have the right of restitution of the lands, territories and
resources which they have traditionally owned or otherwise occupied or used. Which
have been confiscated, occupied, used or damaged without their free and informed
consent. Where this is not possible, they have the right to have compensation. Unless
otherwise freely agreed upon by the peoples concerned, compensation shall take the
form of lands, territories and resources equal in quality, size, and legal status." 122

iv. Human Rights Violations:

One of the Human rights stated under the Universal Declaration of Human Rights Article 17
says as follow:123

121
Ibid.
122
UN 2007. United Nations Declaration on the Rights of Indigenous Peoples, United Nations, New York.
123
UN 1948. United Nations Universal Declaration of Human Rights 1948, United Nations, New York.

71
Laad 462 - Land Policy and Reform

1. Everyone has the right to own property alone as well as in association with others
2. No one shall be arbitrarily deprived of his property.

In the UN Basic Principles and Guidelines on the Right to a Remedy and Reparation for
Victims of Violations of Human Right restitution appears as the way to protect these human
right and restoration as compensation is included.

Restitution should, whenever possible restore the victim to the original situation before the
violations of international human rights or humanitarian law occurred. Restitution includes:
restoration of liberty, legal rights, social status, family life and citizenship, return to there
own residence, restoration of employment and return of property.

v. The need for conflict resolution

Land Conflicts are very complex problems and they usually don't have one single origin,
they have multiple causes that articulate juridical, cultural economic, political, ethnic and
religious facts. Usually all these facts have an historical evolution and have different shapes
through time. In social sciences, conflict is a general denomination for the differences such
as tensions, rivalries, discrepancies and disputes. Land related conflicts with different
intensity could happen between different social units which may arise due to the following
reasons:
 As the result of Land Policies: collectivization, expropriation, policies of apartheid or
ethnic cleansing etc;
 Overlap between customary and statutory law;
 Unclear definition of property rights, double titling;
 National, District, Local or Parcel boundaries not defined; and etc

In some of these conflicts, land restitution is a way to solve this conflicts that in some cases
are the beginning of a process of reconciliation of a country.

vi. The need for economic growth

Due to world globalization of the economy and the change of political regimes in the world
especially in formerly communist's countries; land restitution is seen more as a privatization
of properties. From an economic point of view, it has significant implications for the
functioning of the property markets. In countries where these occur, it has an impact on
foreign investors, who have interest in invest in real estate.

It means that owners, who previously thought they had good title to a property, no longer
enjoy this. The wealth of the previous owner is destroyed or, at least, reduced. Restitution is
therefore associated with the redistribution of wealth. Often the owner, who had previously
enjoyed a good title, was the Government and the new owner is a private individual.
Restitution is therefore one of the means by which private property markets and individual
decision-making over real estate has been created in transitional economies.

5.3. Land Restitution Instruments

As it was stated in the definition of land restitution, the main purpose for land restitution is
converting past injustice through restoration of property rights to the original owners or
possessors. The process of restoration of property rights employs different instruments. The
most commonly used restitution instruments are three:

i. Land Restitution/Restoration: land Restitution in itself as the restitution of property

rights is based on the identification of the original owners. The provision of the
information required for the identification of the original owners is provided by two
organizations: Cadastre that provides the physical description of the land (area,
boundaries). The Registry which provides the description of the owner-rights that
owner has over the land. Depending on the country these two organizations could
functioning separately or integrated as one.

ii. Land Reallocation: land reallocation is the provision of alternative land of the same
value and characteristics as the one owned originally had.

iii. Land Compensation: the concept of Compensation in land restitution appears when
the restitution of the property rights is not possible due to external facts. Under the
principles of international and human rights, the person could then make a
compensation claim. An economic valuation of the lost property has to be made and
the provision of payment for it also.

73
Laad 462 - Land Policy and Reform

Activity 5
1. What is land restitution?
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2. In what circumstances that land restitution can be an appropriate type of land reform?
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3. When do you think compensation could be an appropriate instrument for land
restitution?
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4. What is the difference between land restitution and land reparation?
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Dear student! Have you answered the above questions? If you couldn‘t answer the above
questions, please read this unit again before you proceed to the next unit.
UNIT 6: LAND CONSOLIDATION AND READJUSTMENT

UNIT OVERVIEW
Dear student! In this unit you will be acquainted with the basic concepts of land
consolidation and readjustment. Land consolidation is a procedure of new arrangement of
rural agricultural property (parcels) while land readjustment refers to rearrangement of urban
and peri-urban lands. The unit also discusses about land fragmentation and the rationale for
land consolidation. Moreover, this unit deals with four major approaches of land
consolidation and the role of land consolidation for rural development. Discussion on country
experiences on land readjustment is also part of this unit.

UNIT OBJECTIVES
After completing this unit, you will be able to:

 Define land consolidation;

 Explain about land readjustment;
 Understand about the importance of land consolidation;
 Identify preconditions for successful implementation of land readjustment and land
consolidation;
 Compare and contrast land readjustment with other conventional methods of land
development.

6.1. Basic Concepts of Land Consolidation

Land consolidation is a procedure of new arrangement of rural agricultural property (parcels)

or their parts in a selected area. It is a type of land reform which aims to reverse the side
effects of fragmentation which mainly resulted from subsequent population increase and
continuous subdivision.124 Land consolidation is an exchange of private holdings/ownership
and location of spatially dispersed parcels of farms to form new holdings containing a single
or a few parcels as possible with the same or similar value as the original areas.125 However,
it is not a measure for social justice. It neither changes the status of the large and small
124
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
125
ZHOU, J.-M. 1999. How to Carry Out Land Consolidation: An International Comparison. European University
Institute Working Paper ECO. No. 99/1

75
Laad 462 - Land Policy and Reform

landowners nor gives farm land to the landless. Land consolidation means that farmers
surrender their scattered plots in order to receive an equivalent area or value of land in fewer
and more continuous plots.126

Land consolidation is used for specific purposes according to different conditions in the
agricultural, economic, environment and social sphere in each country. The traditional use of
this procedure is to improve unsuitable land structure for farming and support the appropriate
use of the real property without changing the status of ownership. Beside new structure of
agricultural plots, also improvement of water management, landscaping, transport system,
environmental management and nature conservation supplement the use of land
consolidation procedure.127

Land consolidation is sometimes incorrectly interpreted to be only the simple reallocation of

parcels to remove effects of fragmentation. In reality, land consolidation has been associated
with broader social and economic reforms from the time of its earliest applications in
Western Europe in 17th and 18th century.128 Policy makers often propose land consolidation
programs as a solution to the costs associated with land fragmentation. Most consolidation
programs are results of government policies, ranging from large-scale mandatory programs
to decentralized small programs encouraging consolidation on a more voluntary basis. The
interventions vary in levels of formality and government involvement. Land consolidation
programs often include new roads, irrigation systems, settlement schemes and related
services.

6.2. Land Fragmentation: Rationale for Land Consolidation

6.2.1. Causes and Problems of Fragmentation

Land fragmentation is a state of division of holdings into discrete parcels that are dispersed
over a wide area and usually farmed as single units. It occurs in two parallel directions:
vertical sub-division and horizontal dispersion. The former process leads to gradual reduction
in the size of holdings; the latter gradually increases the distance between farmsteads, where
farm households are located and agricultural inputs are stored, and land parcels.129

As a result of further splitting of farmlands into many small fragments and located in
different places, farmers cannot visit all their fragments everyday without wasting much their

126
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
127
VITIKAINEN, A. 2004. An Overview of Land Consolidation in Europe. Nordic Journal of Surveying and Real
Estate Research Vol.1.
128
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
time in travelling. In more concert terms, the disadvantages associated with fragmentation of
land include the following:130
i. Physical problems such as increased labor time, land loss, need for fencing,
transportation costs, and limitations to access;
ii. Operational difficulties such as unsuitability of certain equipment, greater difficulty
with pest control and management and supervision, foregone improvements such as
irrigation, drainage, and soil conservation;
iii. Social externalities such as need for extensive road and irrigation network; and
iv. Another problem of fragmentation is the increased number of landlessness.131 With
the parcels of land becoming so small that persons are abandoning their land, and
moving to the cities, then landlessness occurs. The continuous fragmentation of land
often finally ends with a very small farm size which is insufficient to create an
economic unit. Then owners of very small farms might be forced to sell and abandon
to urban areas and become landless in the process.

Land fragmentation is an unfinished, still evolving process, especially due to a number of

factors. The major causes of land fragmentation have been attributed to, inheritance customs,
increase in population and poverty.132 The wish to pass property to one‘s heirs is basic for
most land-owners, and is embedded in the customs and religions of the world. Laws of
inheritance vary across cultures and vary from country to country. Some countries have
undivided land inheritance while other parts have divided inheritance. Therefore,
fragmentation leading to minute parcellation can be attributed to a multiplicity of owners or
parcels, where one parcel is owned by many in undivided shares, or one person owns many
parcels in different locations. Such situations are harmful, when the undivided shares are too
small to be viable, or parcels are too scattered and small to be worth cultivating. In addition,
social status conferred by the ownership of land has encouraged the purchase of land, no
matter how small, simply to become a landowner. Sometimes this ownership confers the
rights to hunt or fish, or to participate in any other activity that goes with land ownership and
it invites further fragmentation.133

The growing population in rural areas supplemented by the problem of urban encroachment
into rural areas reduces the land available for agriculture in rural areas. Urbanization places
greater pressure upon the remaining rural land, which leads to the incidence of
fragmentation. Moreover, the spread of towns and cities goes hand in hand with the spread of
129
ZHOU, J.-M. 1999. How to Carry Out Land Consolidation: An International Comparison. European University
Institute Working Paper ECO. No. 99/1
130
BINSWANGER, H. P., DEININGER, K. & FEDER, G. 1993. Power, Distortions, Revolt, and Reform in Agricultural
Land Relations.World Bank Policy Research Working Paper 1164.
131
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
132
Ibid.
133
Ibid.

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Laad 462 - Land Policy and Reform

the infrastructure, and the linear patterns further fragment the land as well as taking land
from agriculture.

Therefore, the explanation about causes and problems of land fragmentation shows that
consolidation of small disjointed parcels into contiguous holdings is preferred by farmers and
landowners. Thus, past experiences on in consolidation could reduce production costs and
improve net income for a farm of given size.134 Land consolidation that produces larger
farms (keeping the number of parcels fixed) is also believed to be beneficial, as it should
reduce the ratio of fixed costs per unit of land, allow more efficient use of technology, and
ultimately increase productivity and efficiency.

6.2.2. Benefits of Fragmentation

Though land fragmentation is associated with a number of problems, it has certain
advantages. The principal advantages exist in the variety of soil located in different locations
and the aspect of small parcels of land, that enable a farmer with a number of small parcels to
grow a wider variety of crops in a comparatively small area. Having different parcels in
different places will create a chance to grow different crops and plants. Reliance on such a
limited number of species can be disastrous, especially when diseases occur, or pests threaten
to wipe out entire harvests. By spreading the variety, the risk can also spread.135 Thus,
fragmentation may also be caused by conscious decisions by farmers seeking to reduce their
risk by diversifying their farm land and thus their crops.136

Justifiable fragmentation often occur in hilly regions, where there is a traditional society
using less advanced farming techniques, either through the lack of modern machinery or
through the restriction imposed by steep gradients and rugged terrain. Fragmented units
provided a critical role in the farmer‘s risk management strategy, giving him access to
different soils and, especially in mountainous areas, different ecological niches. The
fragmented unit is no less detrimental than the oversize unit. Fragmented holding allows
farmers to spread their labour more evenly during the growing season. The small units may
also have ecological benefits.

6.3. The role of land consolidation for rural development

The primary role of land consolidation has been to bring fragmented parcels of land together

134
ZHOU, J.-M. 1999. How to Carry Out Land Consolidation: An International Comparison. European University
Institute Working Paper ECO. No. 99/1
135
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
136
BINSWANGER, H. P., DEININGER, K. & FEDER, G. 1993. Power, Distortions, Revolt, and Reform in Agricultural
Land Relations.World Bank Policy Research Working Paper 1164.
to create economic units of parcels so as to increase productivity of rural land.137 A well-
planned and implemented consolidation scheme can greatly improve the yields and
economics of agriculture in an area, in addition to providing the major new plot structure and
new infrastructure. During the process of land consolidation, particularly when it occurs over
a large area, it is usual to undertake major infrastructure development side by side, which
would otherwise have been uneconomic if the purpose is only assembling many parcels into
few parcels.

Land consolidation is a very successful instrument so as to attain an overall and integrated

rural development.138
 Improvement of rural living conditions and not only the improvement of primary
agricultural production;
 Renewal of villages by permanent economic and political development of the
community and the protection and management of natural resources;
 Active and democratic participation;
 Assistance to villages in order to define the new use of community resources and
appropriate spatial rearrangement;
 Connection between the elements of rural development and the elements of wider
regional development including connections between rural and urban area.

Land consolidation has always been regarded as an instrument or entry point for rural
development. Early concepts of rural development were virtually the same as agricultural
development because of the predominant role of agriculture in rural areas at the time.139
Improving the agrarian structure was viewed as being identical to maintaining the social
viability in rural areas; what was good for the farmers was good for rural areas. An overall
objective of early land consolidation projects was thus to increase the net income from land
holdings by increasing the volume of production and decreasing its costs. With this focus on
agricultural development, these projects served to consolidate parcels and enlarge holdings
and included provisions such as irrigation and drainage infrastructure to improve water
management, construction of rural roads, land leveling, soil improvement measures and
changes to land use such as converting agriculturally inferior land into forest land or
wetlands.

137
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
138
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
139
Ibid.

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Laad 462 - Land Policy and Reform

Land consolidation also plays an important role in safeguarding the rural environment.140
Now concepts of rural development have become much broader and have expanded to
include increased environmental awareness and a wide range of nonagricultural applications.
The emphasis of land consolidation projects has shifted from a focus on restructuring
agriculture to one of achieving more efficient multiple uses of rural space by balancing the
interests of agriculture, landscape, nature conservation; recreation and transportation
purposes.141 Environmental conditions are being given increasing priority. Roads are being
constructed to suit the landscape. Water bodies are being restored, often with buffer zones.
Land consolidation projects are also used for the protection of wetlands and to change land
use patterns especially in areas endangered by frequent floods or soil erosion.

Land consolidation now encompasses activities of village renewal. Projects include

providing adequate land for new houses and workplaces to improve living and working
conditions. Along with the changing rural economy, buildings previously used for agriculture
are renovated and converted to other social and commercial uses. In line with other changes
in the concept of rural development, land consolidation now places increasing importance on
gender inclusion, participatory approaches and the use of mediation and alternative dispute
resolution in resolving conflicts.

6.4. Approaches to Land Consolidation

Land consolidation approaches differ in various respects: form voluntary to compulsory;

from dealing only with farmland to being linked to the overall rural development; from
farmers alone bearing the cost to sharing it with the government; from using traditional
methods to using advanced remote sensing and computerized technologies.142 Land
consolidation programs can be started either by the consent of all landowners (100%) which
is voluntary or by 0% consent of landowners which is compulsory decided by government
authority. On the basis that who initiates the land consolidation program and what activities
are included in the land consolidation program, (FAO, 2003) has identified four approaches
of land consolidation.143 These are:
i. Comprehensive land consolidation;
ii. Simplified consolidation;
iii. Voluntary group consolidation; and
iv. Individual consolidation
140
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
141
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
142
ZHOU, J.-M. 1999. How to Carry Out Land Consolidation: An International Comparison. European University
Institute Working Paper ECO. No. 99/1
143
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
6.4.1. Comprehensive Land Consolidation
This approach covers the re-allocation of parcels together with a broad range of other
measures to promote rural development. Examples of such activities include village renewal,
support to community-based agro-processing, construction of rural roads, construction and
rehabilitation of irrigation and drainage systems, erosion control measures, environmental
protection and improvements including the designation of nature reserves, and the creation of
social infrastructure including sports grounds and other public facilities. Comprehensive land
consolidation projects usually have extensive public works and so they require the
participation of a large number of central government agencies. The implementation requires
extensive political, legal and logistical requirements.

Comprehensive type of land consolidation introduces major changes throughout the project
site, and it generally requires the participation of all owners in the project area. In reality the
involvement of all landowners in the area designed for consolidation is compulsory and
consent from every landowner may not be required. The success of a project thus depends to
a great extent on the initial steps taken to obtain the support and cooperation of farmers and
other stakeholders who would be affected by the project. Therefore, discussion and
consultation with all landowners and other stakeholders at the earliest stage of the project or
before final decision is made by government authorities plays a significant role for the
successful implementation of the project.

Information and communication is essential. People must understand how they will benefit
from the project and how the changes will impact on them. Providing information on the
financing of the project, including who will contribute to financing, is important as it
influences opinions of farmers. Providing information on the benefits of the project is equally
important. Failure to communicate effectively result in misunderstanding and even
misleading rumors. Negative views that are needlessly caused usually result in more difficult
negotiations, delays and higher implementation costs. Information must be tailored to the
knowledge and attitudes of different groups of stakeholders such as farmers and other
residents of the area, and politicians at the local, regional and national level.

6.4.2. Simplified Land Consolidation

Some countries have introduced simplified versions of consolidation. Simplified land
consolidation optimizes conditions in the agricultural sector through the re-allocation or
exchange of parcels, and the provision of additional lands from land banks. These simplified
projects are often combined with the rehabilitation of infrastructure and sometimes the
provision of minor facilities. They do not include the construction of major public works, but
they can provide the framework for their construction at a later stage. Procedures for
simplified land consolidation projects tend to follow those of comprehensive projects but

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Laad 462 - Land Policy and Reform

some of the requirements may be relaxed.

6.4.3. Voluntary Group Consolidation

Some countries provide for mutual agreement with no element of compulsion. As
consolidation is entirely voluntary, all participants must agree fully to carry out land
consolidation. It could be through the spontaneous efforts of farmers in the form of
cooperatives or personal exchanges and should be encouraged and assisted by government.
Most often voluntary group consolidation projects are slow and unsatisfactory.144 As a result,
voluntary projects tend to be small, and voluntary consolidation tends to be best suited to
address small and localized problems.

6.4.4. Voluntary Individual Consolidation

Consolidation of holdings can take place on an informal and sporadic basis. The state is not
directly involved and so these initiatives do not include the provision of public facilities.
However, the state can play a significant role in encouraging consolidations that improve
agriculture by promoting instruments such as joint land use agreements, leasing and
retirement schemes.

6.5. Land Consolidation Procedures

There has been little difference in the process of land consolidation in most countries and the
process of land consolidation comprises four main stages; the request, preparation, decision,
and implementation.145 These will need to be followed by a monitoring procedure to
establish the impact of the scheme, both the amount of subdivision taking place and its speed
of division, together with environmental impacts resulting from the changes in boundaries
and agricultural practices.

i. Request/ Initiation Stage:

A request for land consolidation may come from either the farming community (be it a
majority or even a minority), from a state authority, or from a private developer.146 When the
request comes from the farming community, its agreement is usually established either by a
majority of the landowners or by the majority of persons owning more than half the land to
be incorporated in a scheme, being in favor. The approach related to the majority of
landowners favors those with smaller units. Conversely, in the case of those owning more
than half the land, the benefits will be to the owners of larger units. The assumption here is
that a democratic vote represents more than 50% in either case. Where the request comes

144
ZHOU, J.-M. 1999. How to Carry Out Land Consolidation: An International Comparison. European University
Institute Working Paper ECO. No. 99/1
145
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
from the landowners, and the majority of the farmers are in favor, a land consolidation
scheme is likely to proceed with greater co-operation from the authority responsible for the
activity.

Preparation of an initial concept plan that states the aims of the proposed project and
approximate estimates of costs and sources of financing is also part of this stage of
consolidation.147 Moreover, formation of a local management team with representation from
the community is also required for the successful implementation of the land reform. Finally,
approval of the request by the concerned authority is a requirement to proceed to the next
stage of consolidation.

ii. Preparation stage

The preparation phase is the second stage in the process of land consolidation. The main
activities in this stage are aim to obtain a full inventory of all information related to the
ownership of land. Identification or adjudication of boundaries and the legal status of parcels,
including lease rights, mortgages, and easements or servitudes is required in this stage.148 In
addition, information regarding land value, soil, yield, buildings, and improvements to and
on the land, as well as negative impacts of the project on the environment will be assessed in
this stage. From these sets of information, also known as planes of data, a Land Information
System (LIS) can be constructed.

The cadastral records will be required at this stage. If these are not available or incomplete,
there will be a need for a new cadastral survey to establish the ownership of land, its area,
and the boundaries of each unit for all the participants in the scheme. The proposed
consolidation of all the units, and their subsequent subdivision into economic parcels, will be
undertaken only to a design stage, and this will be shown to the farming community to seek
their approval or disagreement, and to obtain reasons, if any, for their objections. Provisional
costing of the scheme, together with the individual costs for each owner, must be established
at this stage.

As with the requesting stage, it will be important for the authorities to have the support of the
majority of farmers at the preparation stage before proceeding to the decision stage. Since
this stage of the program is largely theoretical, any changes that are introduced will be easy
to incorporate, especially if a LIS has been constructed for the scheme.

iii. Decision stage

146
Ibid.
147
FAO 2003. The design of land consolidation pilot projects in Central and Eastern Europe, FAO Land Tenure
Studies 6, Rome.
148
Ibid.

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Laad 462 - Land Policy and Reform

Once the owners have been shown the proposal and their opinions obtained, and any
reasonable amendments to the scheme implemented, it is finally put to the vote. A majority
of owners should now ideally be in favor if it is to proceed, especially in those instances
where the owners requested the scheme.

With a scheme requested by the government or by a private developer, in those instances

where the state or private company has the authority to go ahead anyway, there may be more
difficulty in enforcing its implementation. This is particularly so if opposition from the
farmers and landowners still exists after reasonable amendments to the scheme have been
carried out. In certain circumstances, it might be appropriate to have a public hearing with an
independent panel to listen to the complaints from the farmers, and the counter arguments
from the other side. In this way a consensus of opinion should be established which would
assist future stages of the scheme and bring about a harmonious end result.

iv. Implementation stage

The implementation stage may attempt to achieve two primary objectives, the establishment
of economic units of land from the former fragmented units, and to providing space for major
infrastructure development, or whatever other objectives there may be of the scheme.149 The
former is the likely outcome of a request by the farmers and/or landowners. For the
government authority, the latter will be of importance while the first objective should also be
achieved at the same time. Where fragmented units are consolidated, they will ideally be
grouped into one economic holding, providing the owners have sufficient land area. Where
there is insufficient land to produce economic units, there will be two alternative choices.
The first choice will involve the owner of the land being compensated for the land that has
been incorporated into the scheme, making the owner effectively landless. This example will
occur where the owner‘s holding is well below the area of an economic unit. In those cases
where the owner has a total area just below that of an economic unit, additional land will be
provided from within the scheme to make up the difference placing the owner in debt to the
authority for the land area added to the original holding.

In the design of the land consolidation scheme, the new economic units will ideally be as
close as possible to the residence of the farmer, and may incorporate one or more of the
original units. Where appropriate, and where funds permit, a village renewal scheme with
new sites for homesteads and farmhouses may be included in the scheme. The
implementation plan is made final when all landowners or farmers are in agreement. The
scheme is then put into action and the landowners or farmers are registered and issued with
their new titles. To avoid disruption it would be appropriate to implement the scheme after
the final harvest has been gathered in and the fields left fallow.

149
BULLARD, R. 2007. Land consolidation and rural development. Papers in Land Management series. Anglia
Ruskin University
6.6. Urban Land Consolidation/Readjustment

Many of the world‘s cities are more than doubling in area within a decade and with this
expansion, so too will the value of land, thus affecting the price of arable land on the
periphery. The expansion of urban areas has lead to the consequential reduction of rural
areas, providing less land for the many rural activities. The rising demand for urban land
tends to primarily be achieved by converting rural land in the urban periphery. Urban land
consolidation, or as it is becoming more familiarly known, land readjustment, can be
increasingly used to assist in orderly urbanization.150

The concept of urban land readjustment has evolved out of rural land consolidation as a tool
to assist urban growth situations in the urban peripheries.151 It is an approach whereby an
irregular pattern or unplanned urban land is assembled, re-parceled and rearranged into
regular building plots to provide land for urban development purposes on participatory and
consensual basis in the urban peripheries.152 It involves rearrangement of land ownership and
adjoining of parcels held with fragmented ownership or holdings. The fragmented sites or
plots are first consolidated, and then the area is developed and partitioned into serviced plots
in a rational and planned way. The tool can be applied to a variety of situations across land
tenure systems.153 More importantly, it is widely used to expand urban boundaries on the
periphery of cities.154

The basic idea of land readjustment is consensual contribution of land for urbanization and
avoiding expropriation and displacement mainly in the urban peripheries. Land readjustment
involves a consensual contribution of portion of land to urban development by land
owners/holders themselves.155 The contributed land can be used for either public property
like open space or for financial resources of land that can be sold to others to collect funds to
finance basic facilities as well as other development costs. The size of contribution for public
space and cost recovery purposes vary from country to country depending on the national

150
Ibid.
151
HOME, R. 2007. Land readjustment as a method of development land assembly: A comparative overview.
Town Plann Review, Vol. 78, No.4, pp.459-483.
152
UN-HABITAT 2003. Handbook on Best Practices, Security of Tenure and Access to Land, United Nations
Human Settelemnts Programme, Nairobi.
153
ALTERMAN, R. 2007. Much More Than Land Assembly Land Readjustment for the Supply of Urban Public
Services. In: HONG, Y.-H. & NEEDHAM, B. (eds.) Analyzing Land Readjustment: Economics, Law and Collective
Action, . Cambridge : Lincoln Institute for Land Policy.
154
LOZANO-GRACIA, N., YOUNG, C., LALL, S. V. & VISHWANATH, T. 2013. Leveraging Land to Enable Urban
Transformation : Lessons from Global Experience. The World Bank Sustainable Development Network Urban
and Disaster Risk Management Department, Policy Research Working Paper No.6312.
155
SCHNIDMAN, F. 1988a. Land Readjustment. Urban Land, 4 February 88.

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Laad 462 - Land Policy and Reform

legislation.156 It is obvious that contribution of land for readjustment project would result in
reduction in the size of the original plot. Even though the remaining area becomes smaller
after readjustment, there is a substantial increase in the value of the land after
readjustment.157 The construction of urban infrastructure boosts land values of the
restructured plots.

Figure 3: Property structure before and after land readjustment

Land readjustment as compared to the conventional methods (expropriation or compulsory

acquisition of land) land readjustment is the cheaper option to provide land for urban
development from urban peripheries.158 The voluntary contribution of land for sale and
public facilities by landowners themselves makes it less expensive than cash compensation
based expropriation. It is also an appropriate mechanism to achieve fair distribution of
development benefits between landowners and municipalities.159 After land is pooled,
readjusted, and serviced, the residents will be invited back to the neighborhood to rebuild
156
HONG, Y.-H. 2007. Assembling Land for Urban Development : Issues and Opportunities. In: HONG, Y.-H. &
NEEDHAM, B. (eds.) Analyzing Land Readjustment : Economics, Law, and Collective Action. Cambridge: Lincoln
Institute of Land Policy.
157
SORENSEN, A. 2000. Conflict, consensus or consent: implications of Japanese land readjustment practice
for developing countries. Habitat International Vol.24, pp.51-73.
158
UN-HABITAT 2006. Enabling Shelter strategies :Review of Experience from two decades of implementation,
United Nations Human Settlements Programme (UN-HABITAT), Nairobi.
159
HONG, Y.-H. 2007. Assembling Land for Urban Development : Issues and Opportunities. In: HONG, Y.-H. &
NEEDHAM, B. (eds.) Analyzing Land Readjustment : Economics, Law, and Collective Action. Cambridge: Lincoln
Institute of Land Policy.
their homes or receive an apartment unit with legal title. This is a win-win approach because
it allows former landowners, landholders and squaters or informal settleers to improve their
living conditions and tenure security, and it increases development densities to enable the
city to obtain much needed land for urban expansion.160

Table 3: Advantages and benefits of LR as compared to expropriation

Expropriation Land Readjustment

Reliance on coercion or seller‘s Reliance on community

exclusive gains participation and empowerment

Cash-based transaction that Equity-based transaction that

imposes a heavy fiscal burden on reduces upfront capital
local governments requirements for land acquisition

Relocation of the urban poor to Relocation provided within the

remote areas with limited access to same neighborhood with improved
jobs and public services tenure security and housing
conditions for the urban poor

Redefinition of existing occupants, Preservation of the existing

often through gentrification of the community
redevelopment area

Exclusive rights against the Inclusive obligations to the

existing community existing community
Source: (Hong and Brain, 2012)

Moreover, land readjustment can help to ensure good governance in urban land
administration by incorporating pro-poor, participatory and gender-responsive decision-
making packages into land development process.161 It is a method by which the city
government, other designated public bodies, private associations, landowners or holders,
developers, NGOs and other concerned parties can involve directly in the process of
urbanization and thereby share its profits situation.162 It encourages the governments to pay
special attention to the needs of the poor from the outset and minimize forced expropriations,
evictions and displacement. The process entails grassroots mobilization by giving the urban

160
HONG, Y.-H. & BRAIN, I. 2012. Land Readjustment for Urban Development and Post-Disaster
Reconstruction. In: LEROYER, A. (ed.) Land Lines, Vol.24,No. 1. Lincoln Institute of Land Policy.
161
UN-HABITAT 2012. Handling Land: Innovative tools for land governance and secure
tenure, Nairobi, United Nations Human Settlements Programme (UN-Habitat).

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Laad 462 - Land Policy and Reform

poor real bargaining power to approve land readjustment proposals. Thus, it is less opposed
by the local community and less disruptive to the existing local community.

Moreover, land readjustment is a very elegant instrument to realize sustainable urban

development in the urban development process.163 According to the 1987 United Nations
Brundtland report, sustainable urban development refers to improving the quality of life in a
city without living a burden on future generations‘ benefits and three important elements of
development that should be considered in the process of urban land development are
ecology, society and economy. Land readjustment is an important tool to generate desirable
urban development patterns; increases land values, allocates these increments to the involved
parties, and limits displacement.164 Therefore, applying land readjustment as land
development tool is an easy way of addressing physical/ecological, social and
economic/financial components of sustainable development simultaneously (see figure 4
below).

Figure 4: Three pillars of sustainable development addressed by LR

Source: Modified based on (Larsson, 1993)

162
DOEBELE, W. A. 1982. Land Readjustment : A Different Approach to Financing
Urbanization, Lexington, LexingtonBooks.
163
MÜLLER-JÖKEL, R. 2004. Land Readjustment – A Win-Win-Strategy for Sustainable Urban Development.
Spatial Planning for Sustainable Development – Policies and Tools: FIG Working Week 2004. Athens, Greece,
May 22-27, 2004.
164
HONG, Y.-H. & BRAIN, I. 2012. Land Readjustment for Urban Development and Post-Disaster
Reconstruction. In: LEROYER, A. (ed.) Land Lines, Vol.24,No. 1. Lincoln Institute of Land Policy.
6.7. Land Readjustment Process: From Country Experiences

The fundamental principle of land readjustment is participatory and consensual contribution

of land for urban development. The review of country experiences show that every country
has a unique way of structuring and implementing it based on country context. However, the
key elements of land readjustment process that should be mentioned form the context of this
study are:
a) The initiation process;
b) Building consensus through community participation; and
c) The reallocation of development benefits and costs.

The implementation of both publicly or privately initiated land readjustment projects begin
with building consensus and persuasion among landowners included in the area and with all
other stakeholders. Moreover, all country experiences show that the final outcome of
implementing land readjustment is to achieve fair distribution of development benefits. More
specific country experiences are highlighted below in table 4.

Table 4: Summary of land readjustment features based on country experiences

Key Features Germany Japan Australia
Legal basis Building code of Land Readjustment Act Town planning & dev‘t
1986 of 1954 Act of 1928

Initiating entity Local Authorities, Individuals, associations, Local municipal councils

Landowners, local Government, and association
developers administrative agencies,
public Corporations
Participation of Compulsory when - Compulsory when -Compulsory when
landowners publicly initiated publicly initiated publicly initiated
-At least two-thirds of -At least two-thirds of
landowners must consent landowners must consent
when privately initiated when privately initiated
Cost Recovery Land contribution Land contribution Land contribution

Amount of Value or area basis Land deduction rate not Land deduction rate
contribution ( No more than determined (usually 20% undetermined
30% of market for public space and 10%
value or land area) for cost equivalent land )

Public sector All procedural National or prefectural Initial costs provided by

support costs subsidy and low or zero government, but must
loan interest rate later be recovered through
the project
Distribution Value or area Value or area basis Value basis
method basis
Source: (Turk, 2008)

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Laad 462 - Land Policy and Reform

The responsibility to initiate land readjustment project may come from either a public body
or private entity. The Japanese experience shows that both parties are equally important to
initiate the project to start.165 In the context of German and Australian, the initiation of land
readjustment projects mainly in the hands of local authorities. Depending on which group has
initiated the project, the purpose of land development can appear substantially different. In
most cases, the motivation behind a government-initiated land readjustment project is to
update land uses or to obtain land for constructing local infrastructure, whereas projects
initiated by private landowners are typically targeted to seek for profit.166 In most cases, the
motivation behind a government-initiated land readjustment project is to update land uses or
to obtain land for constructing local infrastructure.

Another feature of privately initiated projects is that it requires the consent of the
supermajority of landowners/leaseholders in the project area. The Japanese experience shows
that an association could be formed after two-third of the landowners/leaseholders are agreed
to readjust their properties.167 The association attempts to build consensus as the project
moves forward. For publicly-initiated projects commonly practiced in Germany and
Australia, the agreement of the affected landowners is not mandatory requirement, although
the project program is open to an intensive negotiation and discussion with landowners/
leaseholders. When an individual‘s interest in land is in conflict with that of the community
at large, consensus building through persuasion and negotiation should first be used to
resolve the disagreement. Coercion should be employed only as the last resort when the
involved parties have failed to compromise after exhausting all persuasion mechanisms.
Exhaustive negotiation and consultation with all affected parties is therefore the way to
maintain balance in protecting both public and private property rights.

Fair distribution of development benefits and costs is another important aspect of land
readjustment process. After all property units are structured and readjusted, updated local
infrastructure is provided and the market value of all newly subdivided lots is assessed, the
new plots will be then ready to be redistributed to the original owners. The approaches to
calculate the amount redistribution can be based on either relative size or relative value of

MIYAZAWA, M. 1982. Land Readjustment in Japan. In: DOEBELE, W. A. (ed.) Land Readjustment Toronto:
165

LexingtonBooks.

166HONG, Y.-H. 2007. Assembling Land for Urban Development : Issues and Opportunities. In: HONG, Y.-H. &
NEEDHAM, B. (eds.) Analyzing Land Readjustment : Economics, Law, and Collective Action. Cambridge: Lincoln Institute of Land
Policy.
167
SORENSEN, A. Ibid.Consensus, Persuasion, and Opposition: Organizing Land Readjustment in Japan.
their former plots.168 That means that those landowners who owned a greater part before
readjustment will receive a greater part after readjustment either in size or value form based
on country context and preference of land owners.

If for example size is chosen as criteria of redistribution, each owner receives a new land
parcel proportional to the original size. Country experiences above show that landowners
may receive up to 70 % of the original plot size which means up to 30% of the original size
can be contributed for public facility and cost recovery purposes. Even though the size of the
new plot is less than the original size due to the contribution of land for public space and cost
recovery purposes, the value of the structured property will obviously increase due to the
provision of infrastructure in the area. Land owners will get a structured plot after
contribution of land for public space (roads and parks) is deducted (see figure 5).

Before Readjustment After Readjustment

Plot Plot Plot
Plot B Plot C A B C Plot D
Plot A 1000 1000 Street
2000 sq. m sq.m sq.m Plot Plot
E F Park Plot G
Figure 5: Property structure after LR with infrastructure

Another approach to determine or calculate the amount of redistribution is market value.

After assessment of market value of the readjusted properties is completed, every landowner
participated in the land readjustment project will receive a value or development benefit
proportional to the value of the old property. A simple illustration on how to redistribute
benefits/value to the landowners participated in the land readjustment project is provided in
box below.

168
MÜLLER-JÖKEL, R. 2004. Land Readjustment – A Win-Win-Strategy for Sustainable Urban Development.
Spatial Planning for Sustainable Development – Policies and Tools: FIG Working Week 2004. Athens, Greece,
May 22-27, 2004.

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Laad 462 - Land Policy and Reform

Redistribution benefits based on relative value:

Suppose in figure 5 above, value after readjustment = 100,000
euro/plot then total value of plots after readjustment will be 700,000
euro.
 Total infrastructure costs in the area = 120,000 euro
 The cost for infrastructure shall be covered by selling 1.2 Plots.
 The redistribution mass shall be 580000 euro.
 Therefore, owner of plot ‗A‘ shall receive half of the
redistribution mass which is 290000 euro. Because ‗A‘s part
before readjustment was half of the value of 4000 sq.m. Thus
‗A‘ shall take two plots and 90,000euro after readjustment.
Both owner ‗B‘ & ‗C‘ shall receive one-fourth of the total
redistribution mass for each. That means the share of owner ‗B‘
shall be 145,000 euro or one plot and 45,000euro. Land owner
‗C‘ shall also receive 145,000 euro or one plot and 45,000euro.

Therefore, successful implementation of land readjustment as a land development tool has a

number of specific requirements. The implementation of the tool must rest upon the dialogue,
consultation, and participation of all affected parties and stakeholders. More importantly it
needs qualified staff in government agencies and in the relevant private sector. Required are
essential skills in town planning and regional planning, land surveying, land management,
land evaluation, law, economy. There has to be also clear and enforceable rule for the
proportion of voluntary contribution by landowners and if necessary using compulsory
acquisition to include resistant landowners.
 Activity 6
1. Explain how land consolidation is important for rural development.
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2. Mention the major activities in the first step of comprehensive land consolidation.
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3. What is the difference between comprehensive and simplified land consolidation

types?
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4. What is the difference between land consolidation and land readjustment?
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5. Explain how land readjustment is important for urban development.
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Dear student! Have you answered the above questions? If you couldn‘t answer the above
questions, please read the above unit again before you proceed to the next unit.

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Laad 462 - Land Policy and Reform

UNIT 7: LAND REFORM MEASURES IN ETHIOPIA

UNIT OVERVIEW
Dear student! In this unit you will be introduced with the land reform measures in Ethiopia.
In this unit, emphasis is given to describe the land reform measures undertaken during
different regimes. The modern history of Ethiopia is divided into three regimes: the imperial
regime before 1974; the Derg regime between 1974- 1991 and; the current regime since 1991
The land reform measures undertaken in different times could be better understood when it is
analyzed in light of the land tenure systems during these three periods.

UNIT OBJECTIVES
After completing this unit, you will be able to:

 Explain about the land tenure system of Ethiopia;

 Understand about the land tenure system during the imperial regime
 Understand about the land tenure system during the derg regime
 Understand about the land tenure system of the current regime
 Explain the difference between the current and the derg regime land tenure systems.

7.1. Introduction

The issue of land in Ethiopia has been a vital and sensitive topic throughout the country‘s
history. Ethiopia has a long legacy of state intervention in land to man relations.169 The
Ethiopian state has exerted considerable influence on local land tenure regimes throughout
different political regimes.170 The country also differs in some respects from a number of
other African countries in its property rights system. As Ethiopia has not been colonized, do
not find the kind of colonial heritage or legacy pertinent in other sub-Sahara African
countries and societies that resulted in land grabbing by foreigners, which in turn also
contributed to the formalization of private property right to land.

Since the beginning of the twentieth century, three different land tenure regimes have existed
under three distinct political regimes. These were: (1) the feudal/ imperial system of the pre-

169
CREWETT, W., BOGALE, A. & KORF, B. 2008. Land Tenure in Ethiopia: Continuity and Change, Shifting
Rulers, and the Quest for State Control. International Food Policy Research Institute, CAPRi Working Paper
91,Washington, DC.
1975 period; (2) the state ownership of the socialist system in the 1975-91 periods; and (3)
the semi-liberal and market-oriented system since 1991.171 Even though land tenure
institutions continuously evolved in response to the political environment, rural demographic
dynamics, expansion of markets, natural resource conditions (particularly soil erosion), and
social and physical infrastructures, these three periods marked important pivotal points in the
development of the prevailing land tenure system in the country.172 Thus, the land reform
measures undertaken in different times could be better understood when it is analyzed in
light of the land tenure systems during these three periods.

7.2. The Imperial Land Tenure System - before 1975

The Ethiopian land tenure system during the period of empire (before 1975) has been
described as one of the most complex amalgamations of various land use forms in all of
Africa and it has been estimated that there were about 111 tenure types in Wollo Province
alone.173 The country's geographical, ethnic and cultural diversity and its historical
background were mentioned among those factors that had produced highly varied forms of
land tenures systems.174 There was a significant variation in the type of tenure system
exercised in the southern and northern part of the country.175 The most commonly recognized
tenure types of the imperial regime were rist (kinship or communal); gult ( grant land);
gebbar (sometimes referred as private), semon (church), and maderia or mengist (state) land.
In general land tenure during the imperial era was, broadly speaking, best defined as a feudal
system and the crown had exercised the ultimate authority over all land in the state.

7.2.1. Rist Tenure

The rist system was a kind of communal land holding system based on descent that granted
usufruct rights: the right to appropriate the return from the land. The rist/kinship tenure
system was most prevalent in the northern part of the country. In the rist system, all male and

170
JEMMA, H. 2004. The Politics of Land Tenure in Ethiopian History: Experience from the south. XI World
Congress of Rural Sociology, Trondhiem, Norway, July 25-30, 2004.
171
ADAL, Y. 2002. Review of Landholding systems and Policies in Ethiopia Under the Different Regimes.
Ethiopian Economic Association/Ethiopian Economic Policy Research Institute, Addis Abeba.
172
AHMED, M. M., EHUI, S. K., GEBREMEDHIN, B., BENIN, S. & TEKLU, A. 2002. Evolution and technical
efficiency of land tenure systems in Ethiopia. International Livestock Research Institute, Socio-economics and
Policy Research Working Paper 39.
173
BRIETZKE, P. 1976. Land Reform in Revolutionary Ethiopia. The Journal of Modern African Studies, Vol. 14,
No. 4, pp. 637-660.; RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African
Studies, Uppsala, Sweden.
174
BIRHANU, N., BIRHANU, A. & SAMUEL, G. S. 2003. Current Land Policy Issues in Ethiopia. Ethiopian
Economic Policy Research Institute working paper series No. 5.
175
JEMMA, H. 2004. The Politics of Land Tenure in Ethiopian History: Experience from the south. XI World
Congress of Rural Sociology, Trondhiem, Norway, July 25-30, 2004.

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Laad 462 - Land Policy and Reform

female descendants of an individual founder or occupier were entitled to a share of land.176

The allocated usufruct rights did not refer to a specific plot of land, and, since it was often
difficult for rights claimants to trace the pedigree to an ancestral landholder, harshly
competitive bargaining over access to land occurred. Claims to land were usually accepted or
rejected by the representative of rist corporation/commune who consulted other members of
the kinship group. The number and sizes of families varied over time, and in many localities
fragmentation and redistribution of land within the kinship group occurred regularly. Rist
rules aimed at maintaining continuity in the possession of land to both individually operated
and clan lands. That is why rist rights holders usually lacked the right to sell or bequeath
their share outside the family as the land belonged to the descent group, not the individual.

From tenure security perspective, the rist system has provided for general security for
corporation/commune, but it has little security for individual members of commune.
Individual property rights of using a specific plot of land were so insecure and endangered
due the continuous fragmentation and successive reduction in the size of land as there is a
demand from new claimant form a common ancestor.177 In addition, each rist holder's plots
were divided among all his children at the time of his death so that his heirs would similarly
end up with mini-plots in different parts of the community. At the same time, rist system has
sustained and privileged the majority of the rural peasantry with direct access to land through
its distributive role, and guaranteed that the bulk of the land was under peasant control and
has been argued that landlessness and tenancy were minimized.178

7.2.2. Gult and Rist-Gult

Gult tenurial arrangement was a property usually in the form of large estate, granted to
members of the ruling aristocracy.179 It was a fief right that required the rist holding peasants
(or those who held other types of traditional land rights) to pay tribute and taxes in cash,
kind, or labor to landlords. Rights to gult were granted to those who were recognized to have
performed loyal service to the crown, and recipients were empowered to collect taxes or
tribute from the people on gult property and to exercise administrative and, judicial authority
in the area. In the northern part of Ethiopia, gult holders were largely an aristocratic group,
whereas in the southern part, it was civil and military servants of the imperial regime who
had received gult rights as compensation for their services.

Gult rights were also vested to organizations, such as Orthodox Church. Church land,
commonly called semon land, was land which in theory belonged to the state but the rights of

176
RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African Studies, Uppsala,
Sweden.
177
Ibid.
178
HOBEN, A. 1973. Land Tenure among the Amhara of Ethiopia:The Dynamics of Cognatic Descent, Chicago
and Londaon, The University of Chicago Press.
which had been granted to the church in perpetuity. Semon land was meant to be used to
enable the church to support its activities, its clergy and others who provided service to it.
The church as an institution did not itself carry on agricultural activity, it leased the land
instead to others in return for tribute or tax. Those who operated semon holdings could in
turn rent them out to others, either on a crop-sharing basis or in payment of a fixed tribute,
but they could not sell, mortgage, or exchange them in other ways. They could however pass
them on to their heirs provided that the recipients agreed to carry on the obligations of their
legators, i.e. the payment of tax and the provision of service to the institution.

Gult was usually linked to an office, and while the gult lords had a number of duties towards
the crown such as administration, maintenance of security in the region, and military
services, they also had the right to oversee other administrative personnel in the granted area.
Gult estates were worked by tributary peasants, but the granting power, usually the state, held
reversionary right over such estates.180 Gult rights were not inheritable or not necessarily
hereditary, and since formal land ownership was vested in the state, the gult right could be
withdrawn by the crown at any time, although this did not happen frequently.

Besides these gult rights, there existed a system of heritable rist-gult rights that vested the
gult lord with the right to independently exact taxes in cash, kind, and labor for the landlords‘
own purse, a system that increased the independence of landlords from the imperial power.
Initially, only granted to the royal family and provincial nobles, the granting of heritable rist-
gult rights became the rule in the southern part of the country.

7.2.3. Gebbar System

Most often, gebbar system was represented as a close approximation to private property
rights during the imperial regime. Gebbar or private right was recognized as most dominant
system in the last days of the imperial regime.181 The term gebbar, prior to an administrative
reform in 1941, refers to tribute-paying peasants who were controlled by gult lords or local
elites (balabbat), and suffered from burdensome tributes and services to be delivered to these
authorities. After the 1941 land tax reform, the meaning of the term gebbar has come with a
different meaning which is equivalent to private property right.182

The literature identifies two processes that led to the emergence of private property during
the imperial regime. First, after the return of Emperor Haile Selassie from exile in 1942, land
tenure (what is referred to as ‗freehold‘) was granted to selected individuals such as soldiers

179
RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African Studies, Uppsala,
Sweden.
180
Ibid.
181
BIRHANU, N., BIRHANU, A. & SAMUEL, G. S. 2003. Current Land Policy Issues in Ethiopia. Ethiopian
Economic Policy Research Institute working paper series No. 5.
182
Ibid.

97
Laad 462 - Land Policy and Reform

and civilian victims of the Italian occupation. Second, a tax reform in 1941 defined the land
for which tax had been paid to the government as the property of the taxpayer. As a
consequence, taxpaying gebbars became the legal owners of their land.183 All land, for which
no tax had been paid to the government (or put differently - land for which land lords hat
pocketed tax payments made by farmers, instead of forwarding it to the government), was
converted into government land thereby depriving pastoralists of their communal rights. This
tax reform limited the influence of the local landlords and abolished all gult and rist gult
rights, including those of the Orthodox Church. The farmers therefore were no longer
required to pay tribute to the local overlords, but directly to the representatives of the
Ethiopian crown.

The tax reform increased tenure security for those taxpaying peasants, in particular for rist
right holders in the North who had paid land tax and at the same time improved the situation
of a class of taxpaying peasants in the South.184 Overall, these reforms, even though poorly
implemented, meant the juridical recognition of some kind of private property rights for
individual rights holders, including ownership rights. However, many peasants had remained
under the tribute system imposed on them, lost their land or had lived on the land of the new
class of taxpaying gebbar owners. In addition, many landlords had registered formally as
taxpayers and thereby deprived those farmers of their land rights. These farmers then became
tenants who practiced sharecropping. Sharecropping demanded from the tenant to deliver a
large share of up to half of the produce to the landlords to maintain the right to use the land
for subsistence production. The tenant was also subject to arbitrary demands for gifts and
labor services. These sharecropping relations differed between the North as the contracts had
been of less exploitative character than in the South.185

7.3. The 1975 Rural and Urban Land Reform

7.3.1. The 1975 Rural Land Reform

Towards the middle of the 1960s, different sections of Ethiopian society became in favor of
land reform. With the existing feudalistic pattern of land ownership system by then, the
improvement of the agricultural sector and development of the overall condition of the
peasants was almost impossible. This situation gradually culminated into a stage where
formulation and implementation of land reform program became indispensable for the
economic growth of the nation. This awareness spread equally among the University students

183
CREWETT, W., BOGALE, A. & KORF, B. 2008. Land Tenure in Ethiopia: Continuity and Change, Shifting
Rulers, and the Quest for State Control. International Food Policy Research Institute, CAPRi Working Paper
91,Washington, DC.
184
RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African Studies, Uppsala,
Sweden.
185
JEMMA, H. 2004. The Politics of Land Tenure in Ethiopian History: Experience from the south. XI World
Congress of Rural Sociology, Trondhiem, Norway, July 25-30, 2004.
as well. Under their initiatives, campaigns began on the land reform programs. These
students not only campaigned for the initiation of reform programs in Ethiopian agrarian
sector, they provided leaderships to land reform movements in the country as well. These
land reform movements made it clear that presence of outdated land occupancy system was
responsible for the underdeveloped conditions of the Ethiopian agricultural sector.
In 1974 the Imperial regime of Haile Selassie was overthrown by the military junta known as
the Provisional Military Administrative Council, more commonly referred to as the Derg. In
March of the following year, derg has announced a land reform program by proclamation
No. 31/1975. This proclamation declared all rural land to be the property of the state [Article
3] without any compensation to previous rights holders and prohibited all tenancy
relations.186 The proclamation further outlawed all former tenancy relations and provided a
basis upon which to redistribute usufruct land rights to peasants who had suffered under the
exploitation inherent in the tenure systems of the Imperial regime. The reform hence
implemented the ―land to the tiller‖ approach that was popular in the 1970s in most Asian
and Latin American countries.

The 1975 land reform measure by the derg has been considered by many as a radical measure
that has abolished exploitative tenant-landlord relationship in Ethiopia.187 The reform has
provided the chance for the distribution of land to peasant households, and abolishes peasant
dependence on the landlord, along with the landlord himself.188 The reform was basically
designed to alter the then agrarian relations and make those working on the land the owners;
increase agricultural production; create employment; distribute land and increase rural
income; and provide a basis for agricultural expansion.

The reform measure was basically built on the principles of justice and equity. It was mainly
aimed to address the exploitation of the past while providing for a system of agrarian
relations for the future that would provide all of Ethiopian farmers with equal access to land
for cultivation. Thus, the 1975 land reform in Ethiopia was based on two principles of land
reform:189
i. Historical justice: to overcome the exploitative character of imperial agrarian
relations; and
ii. Justice as egalitarianism: providing each farm family with equal access to cultivation
land according to their needs.
186
COHEN, J. M. & KOEHN, P. H. 1978. Rural and Urban Land Reform in Ethiopia. Land Tenure Center:
University of Wisconsin-Madison, Reprint LTC Reprint No. 135, .
187
NEGA, B., ADENEW, B. & SELLASIE, S. G. 2003. Current Land Policy Issues in Ethiopia. FAO Special edition on
Land Reform, Land Settlement and Coopratives. . Rome: FAO.
188
RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African Studies, Uppsala,
Sweden.
189
CREWETT, W., BOGALE, A. & KORF, B. 2008. Land Tenure in Ethiopia: Continuity and Change, Shifting
Rulers, and the Quest for State Control. International Food Policy Research Institute, CAPRi Working Paper
91,Washington, DC.

99
Laad 462 - Land Policy and Reform

The 1975 land reform measure was the first attempt to impose a uniform and central land
tenure system throughout the country.190 The 1975 proclamation no.31 has converted all land
into public ownership and it sets rules for land redistribution and establishment of Peasant
Associations. More specific contents of the reform are the following:191
 Public ownership of all rural lands;
 No private ownership (either by human or juridical person) of rural land resulting in
an immediate expropriation of such holdings without compensation, except for the
movables situated on the land;
 Prohibition of transfer of use rights by sale, exchange, succession, mortgage or lease,
except up on death and only to the wife, husband, or minor children of the deceased;
 For the communal lands, the proclamation gave possessor rights over the land and for
those who were used to till it at the time of the reform;
 The power of administering land was vested in the Ministry of Land Reform and
Administration through Peasant Associations at the grassroots level;
 The maximum limit of land that one can possess was stipulated by the law to be ten
hectares; and
 No able adult person was allowed to use hired labor to cultivate his holdings except
for a woman with no adequate means of livelihood, where the holder is sick or old,
where up on the death of the holder the surviving spouse does not have an adequate
means of livelihood, and where minor children take over at death of the holder(s).

Farmers have open-ended use rights to land in peasant associations where they reside, but
subject to proof of permanent physical residence, and ability to farm continuously and meet
administrative duties and obligations. Farmers were not allowed to transfer their usufruct
rights by sale, mortgage, or lease, and bequeathing of allocated usufruct rights was limited to
primary family members like spouse and children upon death of the rights holder. The plot
size per family was restricted to a maximum of 10 hectares, and the use of hired agricultural
labor was prohibited. The reform was the first uniform tenure system imposed upon Ethiopia
as a whole. Considering the difference in agrarian relations that had existed in the North and
South prior to the reform, the changes were more radical for tenant cultivators (and
landlords) in the South than for rist rights holders in the North. In the rist system, land
distribution had already been relatively egalitarian.

The Derg also implemented a variety of institutional reforms in order to operationalize this
new land tenure system. One of these reforms was the integration of small farms into
collectives along with the introduction of state cooperatives. These institutions sought to do
190
RAHMATO, D. 1984. Agrarian Reform in Ethiopia, Scandinavian Institute of African Studies, Uppsala,
Sweden.
191
Proclamation 31/1975, Articles 3,4 and 5
away with the imperial land tenure institutions (rist and gult) , and replaced them with
peasant associations that were charged with determining access to land.192 The state thereby
effectively abolished the remains of traditional institutions of rist and gult, and took over the
control to distribute access to land through Peasant Associations (PA). Farmers access land
through state-mandated peasant associations. Membership in Peasant Associations was
established as the central element of the state‘s rural bureaucracy and became obligatory for
all farmers. The leadership of the Peasant Associations were entitled to expropriate land from
the landholders and distribute it equally among its members, which made the collectivity of
the members of the Peasant Association proprietors of the land.

In the process of land allocation, the common practice was to allocate land according to the
number of household members.193 Other factors such as quality of land, size of family
workforce and ownership of farm assets, which have substantial influence on ability to use
land, are not given as much prominence as family size. Hence, there are farmers who hold
equal size of land per household, but with significant variation in factor intensity, such as
land per adult labour, land per oxen and land per working capital. As new claimants for land
arise, these associations have continuously to meet the new demands for land. However, their
ability to meet the growing demand for land, especially their capacity to balance other factors
at farm level, has been limited. Thus, many Peasant Associations gradually faced scarcity of
land to be distributed to new claimants.

Most of the redistribution seems to have been completed as early as 1976. Towards the end
of the 1970s, the derg intensified the collectivization program with the promotion of
Agricultural Producer Cooperatives (APC) and the establishment of large-scale state farms.
APC were to be formed by members of a Peasant Association by pooling their land, farm
animals, and farm implements. The head of the cooperative automatically became the head of
the Peasant Association and thereby could exert substantial political control and power over
all association members. Officially, peasants should enter APCs at their free will but in
reality most reports indicate more forceful implementation of cooperatives. Official
membership in PA was restricted to heads(men and widows) of households; married women
held indirect rights as member of the household; rights from redistribution programs in
certain regions of the country occurred; APC members have a right entitled to a share of
APC production.

192
CREWETT, W., BOGALE, A. & KORF, B. 2008. Land Tenure in Ethiopia: Continuity and Change, Shifting
Rulers, and the Quest for State Control. International Food Policy Research Institute, CAPRi Working Paper
91,Washington, DC.
193
ADAL, Y. Some Queries about the Debate on Land Tenure in Ethiopia. In Explaining Growth and
Development in Ethiopia In: DEMEKE, M. & WOLDEHANNA, T., eds. Proceedings of the 10th Annual
Conference on the Ethiopian Economy, November 2-5, 2000, 2001 Addis Ababa.

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Laad 462 - Land Policy and Reform

7.3.2. The 1975 Urban Land Reform

Another land reform measure of the derg which aimed to transform the urban societal
condition was the radical urban land policy that has nationalized all urban land and extra
houses.194 The nationalization of all urban land and extra houses was formally announced in
July 1975 by Proclamation No. 47. To build public support for nationalization, the new
military rulers disclosed figures revealing the extent to which how urban land ownership had
concentrated in a few hands in Ethiopia. The information shows that the largest proportion
of urban land was in the hands of royal family and powerful aristocrats.195

Therefore, following nationalization of rural land, unequal patterns of urban land and
property distribution came under official scrutiny and increasing criticism. Due to the
growing criticisms of unequal distribution of urban wealth, the Provisional Military
Administrative Council (PMAC) issued a policy statement confirming that urban and rural
land would be treated in the same manner (i.e., would be nationalized). The central position
articulated by the PMAC in this announcement is that private land ownership is incompatible
with the basic tenets of Ethiopian Socialism and the government cannot apply "contradictory
guidelines and policies" in different sectors of the country. The statement concluded that
urban land will have to be returned to the people in the same way that rural land was.

State ownership of Urban Lands and Extra Houses Proclamation no.47/1975 was announced
in July 26, 1975. It is complex and far reaching law with the potential to bring about radical
changes in urban society. At the heart of the proclamation is nationalization of all urban land
without compensation. In addition, while private owner ship of urban house is not
completely terminated, an individual or family can no longer own more than a single
dwelling house. All "extra" houses become state property.

The rational and goals of the urban land reform measure was clearly stated in the preamble
of the law. A handful of urban landlords are held to have obstructed urban planning,
development, and improvement in urban living conditions through land speculation and
abuses of economic and political power. The owners of urban dwellings and businesses are
charged with exploiting tenants and evading taxation. Finally, the preamble maintains that
nationalization of urban land and houses is essential for careful planning and resource
utilization, the extension of secure housing facilities to poor urban dwellers, and improved
urban conditions.196

194
COHEN, J. M. & KOEHN, P. H. 1978. Rural and Urban Land Reform in Ethiopia. Land Tenure Center:
University of Wisconsin-Madison, Reprint LTC Reprint No. 135, .
195
Ibid.
196
Ibid.
The 1975 urban land reform has clearly introduced radical changes in urban land patterns.
The proclamation strengthens state control over the physical development of urban areas.
Moreover, it prevents individuals and families from preserving or acquiring large urban
holdings and, thereby, effectively eliminates gross inequities in land distribution. The law
encourages immediate utilization of all urban territory and eliminates much of the confusion
and need for litigation that enveloped previous urban land ownership patterns.

7.4. The Current Land Tenure Policy of Ethiopia

7.4.1. Introduction
Immediately after the downfall of the derg (military socialist regime) in 1991, no one was
certain what course the new government would take regarding land tenure.197 In December
1992, the Transitional Government of Ethiopia has adopted a new economic policy whereby
the government declared that until a new federal constitution would be in place, land would
remain under state ownership. Moreover, the transitional Government disbanded all
collectivization and villagization programs of derg regime.

When the new federal constitution was adopted in 1995, the issue was settled in favor of
state/public ownership of land.198 Article 40 of the 1995 Ethiopian constitution states that: the
right to ownership of all land, as well as of all natural resources is exclusively vested in the
state and the peoples of Ethiopia. Land is a common property of the nations, nationalities and
peoples of Ethiopia and shall not be subject to sale or other means of exchange" (Sub Article
3). Sub Article 4 also states that "Ethiopian peasants have the right to obtain land without
payment and the protection against eviction from their possession." Another important
provision regarding property rights (Sub Article 7) states that "Every Ethiopian shall have the
full right to the immovable property he/she builds and to the permanent improvements he/she
brings about on the land by his labor or capital. This right shall include the right to alienate,
to bequeath, and, where the right of use expires, to remove his property, transfer his title, or
claim compensation for it.

Many scholars have questioned if the 1995 constitution provided any differences to the land
reform proclamation of 1975. There are no fundamental differences between the legal
framework of the derg and the present land policy on rural land issues except some minor
differences between the rules.199 The 1975 proclamation prohibited the lease of land and the
hiring of labor and limited the maximum land size per individual to 10 ha; such provisions

197
NEGA, B., ADENEW, B. & SELLASIE, S. G. 2003. Current Land Policy Issues in Ethiopia. FAO Special edition on
Land Reform, Land Settlement and Coopratives. . Rome: FAO.
198
FDRE 1995a. Constitution of the Federal Democratic Republic of Ethiopia. Proc.No 1/1995, Negarit Gazeta
Addis Abeba,Ethiopia.
199
NEGA, B., ADENEW, B. & SELLASIE, S. G. 2003. Current Land Policy Issues in Ethiopia. FAO Special edition on
Land Reform, Land Settlement and Coopratives. . Rome: FAO.

103
Laad 462 - Land Policy and Reform

are canceled in the 1995 document. Furthermore, Article 40 of the 1995 constitution,
specifies the rights to the compensation payments for investment on land in case the ―right to
use expires,‖ also newly introduced: ―Every Ethiopian shall have the full right to the
immovable property he builds and to the permanent improvements he brings about on the
land by his labor or capital. This shall include the right to alienate, to bequeath, and where
the right of use expires, to remove his property, transfer his title, or claim compensation for
it.‖200

Like that of the derg regime, the urban and the rural lands in the current land policy are
governed by two separate types of legislations. As a result of these two separate legislations,
different types of systems are practiced in urban and rural areas, lease right and
possession/usufruct/holding right respectively see figure 6 below.

Figure 6: The two land holding arrangements in Ethiopia

7.4.2. Dichotomized Views on State Ownership of Land

State ownership of land was instituted in the 1995 FDRE constitution of Ethiopia‘s, but
despite the passing of the constitution, the debate over ownership of land continued and not
settled yet. The constitutional provision that securely vested the ownership of land to the
state has remained one source of disagreement and focus of debate among politicians,
academics and other stakeholders.201 Two antagonistic discourses are distinguished on the

200
FDRE 1995b. Proclamation on the Establishment of Environmental Protection Authority. . Federal
Democratic Republic of Ethiopia Proclamation No.9/1995, Negarit Gazeta.
201
ADAL, Y. Some Queries about the Debate on Land Tenure in Ethiopia. In Explaining Growth and
Development in Ethiopia In: DEMEKE, M. & WOLDEHANNA, T., eds. Proceedings of the 10th Annual
Conference on the Ethiopian Economy, November 2-5, 2000, 2001 Addis Ababa.
land ownership question of Ethiopia and the arguments are built on how the principles of
fairness and efficiency are played out against each other.202 These are:
i. The discourse of fairness and state protection, which is government‘s position for
state ownership of land.
ii. The discourse of privatization and efficiency, the position of critics for state
ownership

A. Government’s Position for State Ownership of land

The government‘s position builds on a social equity paradigm and tenure security
considerations, which can broadly be subsumed under the fairness as egalitarianism
principle.203 In this, state ownership is regarded as the most appropriate means to protect the
rural peasantry from the negative side effects of market forces. In particular, the government
claims that state ownership prevents.204 The accumulation and concentration of land in the
hands of a small number of urban and bourgeois land owners, who acquire large tracts of
land through distress sales by poor peasants, which would lead to:
 Subsequent peasant eviction and poverty;
 The resurgence of exploitative tenancy institutions; and
 Undesirable rural-urban migration of the then landless peasantry.

The government maintains that its policy is tailored to equally distribute land to all who
claim rights to ensure access for the needy, to provide them with the means to make a living
as farmers in rural areas, and to protect them from selling or mortgaging their land, thereby
safeguarding them from the grabbing hand of an urban bourgeoisie and rural elites.205
The government‘s position is supported by arguments pertaining to principles of fairness as
historical justice. Proponents of state ownership argue to the extent that privatization of land
would lead to a ‗total reversal of the 1975 agrarian reform measures and would negate the
positive effects of the derg reforms for the rural peasantry by giving way to the eviction of
the poor. Therefore, the re-emergence of feudal landlords and capitalist farmers who will
alienate small peasants from their land would therefore need to be protected by the state.
B. Critics against State Ownership of land in Ethiopia
Critics of the government‘s position on state ownership of land are most forcefully
represented by some economists, donor agencies, and a number of Ethiopian and
202
CREWETT, W. & KORF, B. 2008. Ethiopia: Reforming Land Tenure. Review of African Political Economy No.
116, pp.203-220.
203
Ibid, DESSALEGN, R. 2004. Searching for Tenure Security? The Land System and New Policy Initiatives in
Ethiopia. Addis Ababa. Forum for Social Studies, FFS Discussion Paper No. 12.
204
ADAL, Y. Some Queries about the Debate on Land Tenure in Ethiopia. In Explaining Growth and
Development in Ethiopia In: DEMEKE, M. & WOLDEHANNA, T., eds. Proceedings of the 10th Annual
Conference on the Ethiopian Economy, November 2-5, 2000, 2001 Addis Ababa.
205
CREWETT, W. & KORF, B. 2008. Ethiopia: Reforming Land Tenure. Review of African Political Economy No.
116, pp.203-220.

105
Laad 462 - Land Policy and Reform

international researchers.206 Most of those propagating privatization of land ownership

emphasize efficiency considerations. 207 Broadly speaking, it is argued that state ownership
of land yields negative effects on land productivity and therefore produces lower efficiency
levels than would be achievable with the working of a private land market. In particular,
those in favor of private property rights assert that state ownership provides barriers to full-
scale efficiency, because:208
 It prevents the emergence of a dynamic rural land market that allows entrepreneurial
agents to access credit and land,
 It discourages farmers on marginal land to out-migrate and ties the farmer to
inefficient uses of his land, which subsequently leads to fragmentation of plot size,
overpopulation in the rural areas and resource degradation, and
 It perpetuates the legacies of the derg regime‘s redistribution programs that are
creating tenure insecurity and discouraging land owners from investing in sustainable
resource use.

These arguments are build on neo-classical economic theories of private property rights and
suggest that privatization raises the incentives for long-term investment on land both
increasing productivity and sustainability of land use, and encouraging accumulation of land
in the hands of entrepreneurial and economically successful farmers, thereby increasing
productivity.209 It is argued that in state ownership system there is insufficient incentive for
long term investment and sustainable land use practices due to tenure insecurity and small
plot sizes coinciding with an increasing rural population and inter-generational struggles over
access to land.210

In addition, some critics of state ownership have also brought forward fairness as historical
justice considerations. Ethiopian land rights have traditionally been tightly linked with the
exercise of power over the rural peasantry – in the imperial period where large parts of the
peasantry were denied land ownership and lived in precarious tenancy relations as much as
during the derg regime, where collectivization and the increasingly tight grip of the state on
the local peasant associations meant increasing state control of farmers.211 Privatization of
206
DESSALEGN, R. 2004. Searching for Tenure Security? The Land System and New Policy Initiatives in Ethiopia.
Addis Ababa. Forum for Social Studies, FFS Discussion Paper No. 12.
207
BIRHANU, N., BIRHANU, A. & SAMUEL, G. S. 2003. Current Land Policy Issues in Ethiopia. Ethiopian
Economic Policy Research Institute working paper series No. 5.
208
CREWETT, W. & KORF, B. 2008. Ethiopia: Reforming Land Tenure. Review of African Political Economy No.
116, pp.203-220.
209
DEMSETZ, H. 1967. Toward a Theory of Property Rights. The American Economic Review, Vol. 57, No. 2, pp.
347-359.
210
DESSALEGN, R. 2004. Searching for Tenure Security? The Land System and New Policy Initiatives in Ethiopia.
Addis Ababa. Forum for Social Studies, FFS Discussion Paper No. 12.
211
ADAL, Y. Some Queries about the Debate on Land Tenure in Ethiopia. In Explaining Growth and
Development in Ethiopia In: DEMEKE, M. & WOLDEHANNA, T., eds. Proceedings of the 10th Annual
Conference on the Ethiopian Economy, November 2-5, 2000, 2001 Addis Ababa.
land holdings means the fulfillment of peasants‘ self-determination as part of the
‗unrestricted economic rights‘ any farmer should enjoy.

Therefore, critics of the current landholding system and those who advocate freehold largely
base their arguments on the behavior of economic agents and familiar property rights
arguments.212 Privatization of landownership increases tenure security of the landholder,
thereby reducing economic costs of litigation over land disputes. It is also argued that
privatization of land ownership will cause a land market to emerge. Land will be transferred
to those who are able to extract a higher value of product from the land as users who are
more productive bid land away from less productive users.

7.4.3. Rural Land Tenure

The rural land tenure policy of Ethiopia is currently governed by rural land administration
and use proclamation. Two years after the adoption of the FDRE Constitution, the Federal
Government enacted a Rural Land Administration and Use proclamation (Proc. 87/1997) that
replaces the 1975 (Proc. 31/1975) rural land law. Proclamation 87/1997 was again repealed
and replaced by a new Rural Land Administration and Use Proclamation (proc.456/2005) in
2005. This proclamation follows the constitutional principle that creates free access to rural
land. It declares that peasant farmers and pastoralists engaged in agriculture for a living shall
be given rural land free of charge. A person, above the age of 18 years may claim a land for
agricultural activities. Women who want to engage in agriculture shall also have the right to
get and use land.213

Following the federal rural land tenure policy formulation first in 1997 and then in 2005,
regional states have also reproduced their regional rural land policy in accordance with the
federal rural land tenure policy.214. All regional policies therefore validate state ownership of
land and farmers receive usufruct/possession rights only free of charge to plots of land
without transfer rights, such as sale or mortgage. Therefore, the principle of free access to
rural land has also been accepted in the regional land laws. The conditions attached to this
right are first, the person must want to engage in agricultural activities. In other words,
agriculture must be his/her main means of livelihood or profession. Secondly, s/he must
reside in the area where the agricultural land is located. Thus, residency and profession are
the two important conditions to get rural land in Ethiopia.215

212 CREWETT, W. & KORF, B. 2008. Ethiopia: Reforming Land Tenure. Review of African Political Economy No.
116, pp.203-220.
213 FDRE 1997. Rural Land administration Proclamation. Federal Democratic Republic of Ethiopia
Proclamation No.89/1997, Negarit Gazeta. Addis Abeba, Ethiopia.
214 Ibid, FDRE 2005b. Rural land administration and use proclamation. Federal Democratice Republic of
Ethiopia Proclamation No. 456/2005. Addis Abeba.
215 AMBAYE, D. W. 2012. Land Rights in Ethiopia: Ownership, equity, and liberty in land use rights FIG
Working Week 2012 : Knowing to manage the territory, protect the environment, evaluate the cultural
heritage. Rome, Italy, 6-10 May 2012.

107
Laad 462 - Land Policy and Reform

Thus, any resident of rural areas of the country who want to engage in farming activity for
his/her livelihood can receive holding rights to plots of land from rural areas with holding
right for life time free of charge.216 Those who receive land for agricultural purpose from
rural areas have the authority to use and harvest on it, to rent it, to donate it, to bequeath and
sharecropping except sell and mortgage. The contents of land rights specified as parts of
holding right are the right to use; the right to create an asset on the land; the right to transfer
an asset he created by gift or inheritance and; the right not to be displaced from holdings. The
rural landholder has a right to use the land for agriculture and natural resource development,
to decide what to grow, to withdraw products from it, to maintain the productivity and
fertility of land. The landholders have also the right to protect and exclude others who want
to assert access, withdrawal and management rights on their holding.

Table 5: Rural land holding rights and landholder's position in Ethiopia

Land rights Rural landholder’s position

Access 
Withdrawal 

Management 

Exclusion 
Alienation Transfer through inheritance/gift and rent is permitted
but the right to sale is prohibited
Holder’s Position Strong Proprietor

Source: Modified based on (Schlager and Ostrom, 1992)

As table 5 above shows, the landholders of rural areas are provided an authority to exercise
the rights ordered from access to exclusion. In addition they are provided to transfer holding
right through gift and inheritance to family members. Thus, according to property rights of
Schlager and Ostrom, the right holder who is provided to exercise these lists of rights can be
considered as proprietor. Proprietor is the one that holds the rights exercised by authorized
entrants, authorized users and claimants together and in addition it has also an authority to
determine who may have access and harvest from a resource (Ostrom, 1999) and (Schlager
and Ostrom, 1992). But the rural landholder in Ethiopia is provided with some additional
rights that cannot be exercised by proprietor such as the right of transferring holding right to
the family member through gift and inheritance and the right of exchange. This shows that

216
FDRE 2005b. Rural land administration and use proclamation. Federal Democratice Republic of
Ethiopia Proclamation No. 456/2005. Addis Abeba.
the position of rural landholder is neither proprietor nor owner but in between the two right
holders and can be said as strong proprietor.

7.4.4. Urban Land Tenure

After the down fall of the derge in 1991, the Transitional Government of Ethiopia came up
with a new urban land tenure policy which follows a leasehold system under state ownership
of land. The urban lease system was introduced in Ethiopia as a sole means of urban
landholding when this new law was adopted in 1993(Urban Lands Lease Holding,
Proclamation No. 80/1993). Since the lease system was enacted before the adoption of the
constitution, and since the constitution does not say anything about urban land, it can be
argued that this proclamation and the subsequent lease proclamations for that matter lack
constitutional base.217 This law was repealed in 2002 (Proc. 272/2002) and it again was
replaced by the current proclamation in October 2011(Proc.721/2011).

Since 1993, urban land tenure policy of Ethiopia has passed through various revisions
without significant effect on the ownership right of land. Land is a state property, but use and
development rights are given to the people of Ethiopia. The objectives of urban land lease
policies of Ethiopia issued in different are obviously a twofold. First it is aimed to collect
enough money for the construction of urban infrastructure. The second objective is targeted
to transfer land to the people through leasehold as a response to the growing demand of
urban land.

The leasehold system in the urban areas is a means devised by the state as the owner of land
to transfer the urban land rights to the people through lease agreement with lease price
payment. The allocation/transfer urban land through lease agreement can be either tender
(auction) or allotment (leasehold right transfer without auction).218 The land needed for
residential housing, business (urban agriculture, industry, or services) and others can be
transferred to people only by tender. However, the city administration based upon the
decisions of the regional state cabinet may give land by allotment (without auction) to the
selected areas of paramount importance to the society such as government office premises,
charitable organizations, public residential housing construction programs, places of worship
of religious institutions, diplomatic mission and so on. Besides, a person, who is displaced
from his house as a result of urban renewal or expropriation for other public purposes, shall
get land by allotment. All except the last would pay lease price based on the benchmark set
by municipality/city administration.

217
AMBAYE, D. W. 2012. Land Rights in Ethiopia: Ownership, equity, and liberty in land use rights FIG Working
Week 2012 : Knowing to manage the territory, protect the environment, evaluate the cultural heritage. Rome,
Italy, 6-10 May 2012.
218
FDRE 2011. Urban Lands Lease Holding Proclamation Federal Democratic Republic of Ethiopia Proclamation
No. 721/2011, Negarit gazetta. Addis Abeba, Ethiopia.

109
Laad 462 - Land Policy and Reform

Urban leaseholders granted land rights by either auction or allotment would conclude
contract of lease agreement with regional state representative mostly city administration. The
details of lease contract include the construction start up time, the completion time, lease
price per meter square, grace period, rights and obligations of the parties.219 After the lease
contract is signed between the leaseholder and the representative of the state, the leaseholder
shall be issued with leasehold right certificate containing the name of the leaseholder, size
and location of the plot, the land use type, the amount of initial lease price payment, the total
amount of lease price, the time of final lease payment to be effected and other details.

Urban land according to the urban land lease policy can be transferred to the people with
leasehold for specified period of time. The duration for leasehold right varies depending on
the purpose for which the land is requested and the level of urban centers. The maximum
duration is 99 years of holding provided for the construction of residential house, science and
technology centers, research centers, government offices, charitable organizations and
religious institutions while the minimum duration is 15 years for urban agriculture land. The
period of lease can be renewed upon its expiry on the basis of the prevailing bench mark
lease price and other requirements of the time. However, the leaseholder may not be entitled
to compensation where the lease period could not be renewed.

The leasehold right system defines the rights of leaseholder over urban land and the
obligation to use the land for the prescribed purpose within the specified time. The leasehold
rights provided to the leaseholder include the rights to use and develop over land. The right
to transfer leasehold right through inheritance, gift and sale is also permitted if there is an
improvement or development on lease land. The leasehold right can also legally be used as a
collateral for borrowing money from banks, at least for the lease amount already paid.

The specific rights permitted to be exercised by urban land leaseholder and the positions of
individual leaseholder can also be explained and demonstrated by using property rights
analytical framework. The leaseholders after being granted of urban land through lease
agreement have full right of exercising use, development and management rights. More
specifically, the leaseholder has the rights to decide what and how to build according to plan
and lease contract. The right of transferability with some sort of restriction and precondition
is also permitted in the leasehold system. That means urban leaseholder is permitted to
transfer the rights through inheritance, gift and sale if and only if there is a development or
an improvement on the leased land. Therefore, the leaseholder of urban land can exercise
rights of access, withdrawal, management, exclusion fully and the rights of alienation
partially (see table 6 below).

219
Ibid.
 Table 6: Urban leasehold rights and leaseholder's position in Ethiopia
Leasehold rights Leaseholder’s Position
Access 
Withdrawal 
Management 
Exclusion 
Alienation Only improvement can be transferred
through bequeath, gift, sale; not the land
itself.
Leaseholder’s Position Weak Owner

Source: Modified based on (Schlager and Ostrom, 1992)

Table 6 above shows that the rights provided to urban land leaseholder are close to
ownership rights except restrictions of transferring only if there is development on it. Even
though land ownership in Ethiopia belongs to the state and people collectively, individual
urban leaseholder can exercise most of the rights that can be exercised by an owner.
Therefore, in this study the position of urban leaseholder is categorized as weak owner due to
some restrictions on transferability of leasehold rights.

The leaseholder‘s right to alienate through sale and obtain benefits from it depends on the
level of construction and improvement on it. For example, if a leaseholder wishes to sell
his/her leasehold rights before commencement of construction or half-completed
constructions, leaseholder will get only the effected lease payment including interest rate plus
cost of the already executed construction plus 5 percent of the remaining sale value.220 The
remaining 95% goes to the land owner (state). Thus, transferring only leasehold right of bare
land or leasehold right with only half-completed construction gives only a minor benefit to
sellers of leasehold right. Moreover, the leaseholder‘s ability to use the lease right as
collateral will be influenced by the amount of lease price paid. That means the value of the
property or the building for the banks depends on the amount of lease price already paid to
the land owner (the state). The right of transferring lease rights through gift or inheritance is
also permitted to family members only.

7.4.5. Patterns of Land Rights in the Peri-urban Areas

The distinguishing features of rural and urban land holding arrangements are clearly
identified in the legislations. However, the clear cut boundary between these two land
holding arrangements doesn‘t always coincide with the usual spatial rural-urban demarcation
due to the continuous conversion of rural areas into urban areas as a result of urban
expansion. Land development or the conversion of land use from rural to urban in the
transitional peri-urban areas involves land right change and transfer institutionally. Urban
220
Ibid.

111
Laad 462 - Land Policy and Reform

growth policy of Ethiopia is based on expropriation and transfer of land rights from peri-
urban areas. Therefore, the land holding arrangement is in a continuous state of change as
urban areas expand to the adjacent peri-urban areas.

In the peri-urban areas, the land holding system is governed by the rural legislations and rural
institutions. The landholders in the area are expected to exercise holding rights like that of
the rural landholders without time limit. In practice, however, the existing land holding
arrangement has been changing into leasehold system. As the land is demanded for urban
purpose the government/city administration takes the land from peri-urban landholders and
transfers it to the urban oriented individuals or companies (private residential house
developers, real estate developers, governmental and governmental organizations and so on)
through lease contract. In the expropriation legislations of Ethiopia, the state has the power to
expropriate land with compensation payment if it is in public interest.221 State expropriation
is the predominant tool of converting the land use from rural use to urban use in the peri-
urban areas.

The rural-urban dichotomy of the land holding arrangement forces the government/city
administration to re-assign land rights every time as urban areas expand to the transitional
peri-urban areas. The re-assignment of land rights from peri-urban areas for urban
development purpose passes three major steps (see figure 7). The first step is land
expropriation by the government/city administration from peri-urban villages. The second
step is changing the land holding arrangement to leasehold right system and the third step is
land transfer between the government/city administration and potential leaseholders.
Actually, the activities in second and third steps would be undertaken simultaneously.
Obviously, the potential leaseholders would be different from the original peri-urban
landholders. That means the subjects of right holders will also change immediately after
expropriation has undertaken.

Figure 7: Patterns of land re-assignment in the peri-urban areas of Ethiopia

221
FDRE 2005a. Expropriation of Land Holdings for Public Purpose and Payment of Compensation
Proclamation. Federal Democratic Republic of Ethiopia Proclamation No.455/2005. Addis Abeba, Ethiopia.
As figure 7 above shows, the peri-urban landholder governed by the rural land holding
arrangement is restricted to use the land only for agricultural purpose and they can transfer
the holding right only to their family member through inheritance and gift. While after the
same land is expropriated by the government and transferred through lease contract to the
potential leaseholder for urban purpose, the leaseholder enjoys a thicker bundle of rights as
compared to the original peri-urban landholder. From transferability and tradability point of
view, urban land leaseholders can sell the lease right and can use it as a mortgage for
borrowing money from banks. The land rights provided to urban land leaseholder are close to
the rights that can be exercised by an owner in private property system.

Both in the federal and regional rural land holding arrangement legislations the duration of
holding right is not mentioned. The omission of the duration of holding right opens a room
for the government/city administration to take land from peri-urban landholders for urban
development purpose at any time and it leaves a room for tenure insecurity.222 The
landholders in the peri-urban areas are not certain for how long they can keep their holding
right. Thus, the holding right in the peri-urban areas seems to be temporary. Hence, the land
which is highly demanded for better and high valued urban development purposes has been
taken and transferred to the urban group with better rights to practice. While the original peri-
urban landholders would receive a compensation payment calculated for agricultural land
without taking into consideration of the value of future development of the land.

222
DESSALEGN, R. 2004. Searching for Tenure Security? The Land System and New Policy Initiatives in Ethiopia.
Addis Ababa. Forum for Social Studies, FFS Discussion Paper No. 12.

113
Laad 462 - Land Policy and Reform

Activity 7
1. Why the pre-1974 land tenure system in Ethiopia was considered to be one of the
most complex land tenure systems?
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2. What kind of land reform measures were undertaken during the imperial regime?
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3. Do you believe that the land reform by the Derg has been a radical measure in the
land tenure history of Ethiopia?
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4. What do you think are the major causes for land reform measure during Derg
regime?
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5. Do you think the Derg Land reform has attained its predetermined objectives?
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6. What is the difference and similarity between the Derg land reform and the current
land tenure system?
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