Impacts of Land Certification on Tenure Security, Investment and Land Markets: Evidence from Ethiopia (Amhara Region)

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Impacts of Land Certification on Tenure Security,
Investment and Land Markets Evidence from
Ethiopia (Amhara Region)

• Klaus Deininger, Daniel Ayalew Ali, Tekie Alemu
• 05 March 2009

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Policy environment

• Evolution of Ethiopias rural land policy
  environment
• Feudalist structure followed by nationalization
  and collectivization in 1975
• 1995 constitution w. guaranteed access
• 1997 decentralization of responsibility to
  regions
• Reasons for high tenure insecurity
• 1997 Amhara redistribution current debate in
  Tigray
• Urban and agro-industrial expansion (flowers)
• Leasing still restricted everywhere except in
  Amhara region
• Will lose land if find off-farm job with
  permanent income
• Ethiopia as an interesting case
• Huge program (25 mn plots) quite rapidly
  implemented with little outside assistance
• Turns conventional wisdom on its head
• Participatory local process - rather than expert
  driven
• Rights are not alienable - and plenty of
  remaining policy restrictions
• No spatial reference at all contrary to
  surveyors

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Program characteristics

• Main features
• Democratically elected LAC has responsibility
• Field-based adjudication process (elders to
  resolve conflict)
• Certificates with holders pictures but no map
  (to be added in 2nd stage)
• Very cost-effective 1st stage (lt 1 US/parcel)
• Process characteristics (from nation-wide survey)
• Public meetings held, LACs with members from most
  sub-kebeles
• High share of field-based adjudication
• Only 5 of unresolved conflicts (vs. 20 in
  Thailand)
• Case study/survey evidence on possible impact
• High willingness to pay to replace certificate
• Reduction of conflict
• Gender (womens pictures, awareness where
  stored) polygamy

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Data and general approach

• Data sources
• 4-round panel (1999, 2001, 2004, 2007) from East
  Gojam
• Some 900 households with 4,000 plots in each
  round
• 3 rounds before implementation, some certified in
  4th round
• Identification strategy
• Define villages as treated if certified gt 12
  months ago
• Control for household specific effects
• Verify that there is little difference in
  time-varying effects
• Conservative estimate for two reasons
• Even in treated villages not all households have
  certificates
• Many households in untreated ones had
  certificates
• Expected short-term impacts
• Perceived tenure security
• Land-related investment (soil conservation
  measures)
• Rental market participation

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Outcome variables considered

• Perception of admin. land size change next 5
  years
• Recent land redistribution (1997)
• (Un)compensated expropriation for urban expansion
• Both loss and increases are relevant (political
  pressure)
• Question included in all 4 rounds
• Investment in soil water conservation
  structures
• Should see a direct investment effect
• Existence and new construction
• No of hours spent in maintaining/constructing
• Land rental market participation
• Amhara the only region where no constraints in
  terms of length
• Both participation and area transferred

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Risk of land loss
Equation to be estimated
use Chamberlains method
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Investment rental market
Plot-level investment equation
Household-level rental market participation
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Policy implications for Ethiopia

• Ensure sustainability of impacts
• Establish mechanisms for regular updating
  (computerization)
• Add spatial element (satellite imagery)
• Systematically include CPRs
• Demarcation dealing with encroachment
• Rules for internal management
• Enforcement mechanisms
• Enhance benefits through policy changes
• Land leasing off-farm employment
• Threat of redistribution/enforcement of LT
  contracts
• External threat from expropriation
• Explore longer-term effects
• Already benefit much beyond cost
• But could be much larger ( very cost-effective)
• Especially with policy changes

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