Show and discuss the economics of land reform policy to redistribute agricultura
ID: 1212558 • Letter: S
Question
Show and discuss the economics of land reform policy to redistribute agricultural lands across two equal groups of farmers. Assume the two groups have the same human capital in terms of farming (same Marginal Product curves) and that the amount of agricultural available land is fixed and constraining. Find the agricultural output maximizing allocation of land between the two groups. Show that any other allocation of land will result in lower total output. Discuss the output per person in each group under both scenarios and why a sub-optimal distribution of land might persist.
Explanation / Answer
Economic basis of Land Reform
Over six million people live in Zimbabwe’s marginal rural lands which are characterised by infertile soils and unreliable rainfall, lack of control of water rights and top secret access to the bulk of the nation’s natural resources. Inequitable access to these resources means that 4500 mainly white large farmers today dominate Zimbabwe’s largely agrarian economy. Together with transnational capital, white agrarian interests control key sectors such as tourism, forestry, commodity exports and the narrow agro-industrial complex underlying its urban political economy. These imbalances dramatically skew Zimbabwe’s income distribution structure, reflecting an unchanged legacy of colonial rule. Thus, in spite of the liberation war, a narrow racial and class monopoly over land has been consolidated through extra market and repressive governance processes for decades.
This economic structure undermines the growth of rural incomes and the expansion of domestic Zimbabwean markets such that over 60% of the rural people are ot afford basic health and educational services. Zimbabwe’s human poor (Poverty Assessment Study Survey, GoZ 1997) and cann capital is thus constrained by an inefficient economic structure, which underutilizes its people and degrades the quality of their life.
The growth of poverty, unemployment and income disparities in the face of the underutilization of substantial parts of Zimbabwe’s land and natural resources, despite the continued significant growth in commercial agricultural production and tourism, is the main factor which fuels today’s land debate. While historical grievances over land alienation are important, these tend to be subordinated to the more generalized demand for the redistribution of land for productive uses by a variety of potential and actual small and large scale indigenous land users. In the formal media, the most visible demands for land, contrary to widespread grassroots land bidding processes, are those of indigenous elites.
However, the demand by indigenous elites for large scale farms, such as those of some white owners whose size is not conducive to efficient land utilization, is not a primary factor in the land policy formulation because the economic rationality of this focus is questionable. The key objective of land reform policy is to establish a more efficient and rational structure of farming and land and natural resources utilisation. A rational land policy should not defend the interest of minority elite groups at the expense of optimal land utilisation, increased productivity, employment growth, improved income distribution, and environmentally sustainable use of resources. But this cannot mean that varied farm sizes including conceptually reformed notions of medium scale farms with varied efficient land uses, must be excluded from land redistribution.
The key issue facing Zimbabwe’s land reform policy therefore is how to balance the control and access to land, by redistributing land from large scale landholders who underutilise their land to new small and medium scale users. Such landholders include: individual large scale farmers whether white or black, large parastatal land holdings, large multinational firm landholders, large domestic conglomerates which specialize in mainly non-agricultural activities, and large private natural resource conservancies. The challenge here is how to „transfer peacefully" land from those who have been and remain unwilling and incapable of
mobilizing adequate financial and labour resources towards the optimal use of land and natural resources at their command.
One key problem is that most of these landowners are not socially grounded in the land tenure value system of Zimbabweans and are remote from its mainstream party politics. The non-Zimbabwean nationalities and physical absence of many of the large landowners and the increasing use of stock holding land tenure arrangements for the control of land, especially in the growing eco-tourist industry, has increasingly globalised the fundamental interests of Zimbabwe’s land question. This has tended to make elusive the negotiated redistribution of land since Independence. The utilisation of a government led compulsory land acquisition and redistribution approach partly reflects the failure of all interested parties to redress Zimbabwe’s land problem.
The objectives of this analysis therefore, is to evaluate systematically the political economy of Zimbabwe’s emerging land policy. We assess government’s consistency in addressing the land question through an empirical evaluation of the outcome of its efforts to identify land to be acquired compulsorily. The criteria used to evaluate the policy direction are the GoZ’s own administratively set criteria namely: land underutilisation (including derelict land), multiple farm ownership, farmer absenteeism, proximity to communal areas, and oversized farms in relation to their agro-ecological potential. The paper in effect examines the socio-economic implications of the land that was gazetted for acquisition by assessing its quality, the extent of multiple farm ownership, the use of such land, the social features of the identified farms and the potential economic impact of acquiring this land.