Tenure (In)security and agricultural investment of smallholder farmers in Mozambique

Hosaena Ghebru Hagos
International Food Policy Research Institute/ Mozambique Strategy Support Program

Poor agricultural productivity and food insecurity are persistent features of many less developed countries. Governments and international development agencies have therefore rightly considered agricultural intensification as the primary means for inducing technological change in developing countries that have high population pressure and low agricultural productivi-ty. Integral to this growing global interest in agricultural intensification is the issue of land tenure security (Holden et al. 2008). Because of the conventional view that traditional or “customary” land rights impede agricultural development (Johnson 1972; Gavian and Fafchamps 1996), many developing countries and major multilateral organizations have promoted formalization of land rights (in the form of registration and certification of land) as a top priority in their economic development agendas (Atwood 1990; IFAD 2001; Bonfiglioli 2003; Deininger 2003; Holden et al. in press).

In theory, there are three routes through which secure property rights may influence agricultural productivity. The first channel is by encouraging long term land investment and adoption of new technologies (Barrows and Roth 1990; Besley 1995; Sjaastad and Bromley 1997; Deininger and Jin 2006). According to this hypothesis, afraid of not recouping the investment made on land to which the user has access but no secure property rights, the user hesitates to spend resources on land-improving technologies (conservation, manure, fertilizer, etc.). As a result, the demand for productivity-enhancing investment declines and aggregate agricultural productivity suffers. Secondly, secure property rights also are thought to influence agricultural productivity because such rights encourage efficient resource use (factor intensity). This is so since the establishment of clear ownership of land lowers the cost and risk of transferring land, which improves factor intensity such that land will be reallocated to more efficient producers. Thirdly, it has also been claimed that secure property rights can stimulate efficient resource use as such rights should reduce land related disputes (Deininger and Castagnini 2006; Holden et al. 2008) and may contribute to better access to credit if land can be used as collateral.

Publication date
Source / Citation
Hagos, H. G. "Tenure (In)security and agricultural investment of smallholder farmers in Mozambique," IFPRI/MozSSP Working Paper No. 5, December 2012.