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Evaluating the Impact of Land Tenure and Titling on Access to Credit in Uganda

  • Petracco, Carly K.
  • Pender, John L.

Increasing smallholder farmers’ access to credit is a paramount concern in Africa in general and in Uganda in particular, as a means to help modernize agriculture. We use matching impact evaluation methods to assess four pair-wise comparisons: i) households who have freehold land with vs. without a title, ii) households who have customary land with vs. without a customary certificate, iii) households with a title or certificate having freehold vs. customary tenure, and iv) households without a title or certificate having freehold vs. customary tenure. Each comparison is then evaluated for the impact on access to any form of credit, formal credit and informal credit. Two matching methods were used and the results compared to test the robustness of the conclusions. The only statistically significant finding is a positive impact on access to credit of households with freehold without title over customary holders without a certificate. The results imply that tenure rights, rather than title to those rights, affect credit access for rural households in Uganda. The fact that access to informal credit is increased by freehold tenure status, even without a title, suggests that informal lenders use the tenure status as a screening device, rather than as recoverable collateral.

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Paper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 51899.

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Date of creation: 2009
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Handle: RePEc:ags:iaae09:51899
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