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Technical Efficiency and Productivity Differential Effects of Land Right Certification: A Quasi-Experimental Evidence

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  • Ghebru, Hosaena
  • Holden, Stein T.

Abstract

Although theory predicts that better property rights to land can increase land productivity either through long-term investment effects and/or more efficient input use due to enhanced tradability of the land, empirical studies on the size and magnitude of these effects are very scarce. Taking advantage of unique quasi-experimental survey design, this study analyzes productivity impacts of the Ethiopian land certification program by identifying how investment effects (technological gains) would measure up against benefits from any improvements in input use intensity (technical efficiency). We adopted a data envelopment analysis–based Malmquist-type productivity index to decompose productivity differences into (1) within-group farm efficiency differences (technical efficiency effect, and (2) differences in the group production frontier (long-term investment or technological effects). The results show that farms without a land use certificate, on aggregate, are less productive than those with formalized use rights. We found no evidence to suggest this productivity difference is due to inferior technical efficiency. Rather, the reason is down to technological advantages, or a favorable investment effect, from which farm plots with a land use certificate benefit when evaluated against farms not included in the certification program.

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  • Ghebru, Hosaena & Holden, Stein T., 2015. "Technical Efficiency and Productivity Differential Effects of Land Right Certification: A Quasi-Experimental Evidence," Quarterly Journal of International Agriculture, Humboldt-Universitaat zu Berlin, vol. 54(1), pages 1-31, February.
    • Handle: RePEc:ags:qjiage:206294
    DOI: 10.22004/ag.econ.206294
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    7. Holden, Stein T. & Tilahun, Mesfin, 2020. "Farm size and gender distribution of land: Evidence from Ethiopian land registry data," World Development, Elsevier, vol. 130(C).
    8. Chenguang Teng & Kaiyu Lyu & Mengshuai Zhu & Chongshang Zhang, 2023. "Impact of Conservation Tillage Technology Application on Farmers’ Technical Efficiency: Evidence from China," Agriculture, MDPI, vol. 13(6), pages 1-16, May.
    9. Shi, X. & Zhou, Y. & Heerink, N. & Ma, X., 2018. "The effect of land tenure governance on grain efficiency: Evidence from three provinces in eastern China," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277477, International Association of Agricultural Economists.
    10. Embaye, Weldensie T. & Bergtold, Jason S. & Schwab, Benjamin & Zereyesus, Yacob A., 2018. "Modeling Farm Household’s Productivity under Inseparable Production and Consumption decisions," 2018 Annual Meeting, August 5-7, Washington, D.C. 274226, Agricultural and Applied Economics Association.
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    12. Holden, Stein T. & Tilahun, Mesfin, 2017. "Land Distribution in Northern Ethiopia from 1998 to 2016: Gender-disaggregated, Spatial and Intertemporal Variation," CLTS Working Papers 3/17, Norwegian University of Life Sciences, Centre for Land Tenure Studies, revised 21 Oct 2019.
    13. Luis A. De los Santos‐Montero & Boris E. Bravo‐Ureta, 2017. "Productivity effects and natural resource management: econometric evidence from POSAF‐II in Nicaragua," Natural Resources Forum, Blackwell Publishing, vol. 41(4), pages 220-233, November.
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