Land rights and the impact of farm input subsidies on poverty convergence

Notwithstanding the global significant progress in reducing poverty over the last two decades, still many people live in poverty. Consequently, social protection remains key to welfare sustainability. In this paper, we used longitudinal data from Malawi to examine the impacts of farm input subsidies on poverty convergence. Convergence is coined here as the reduction in persistence of poverty over time. We specifically estimated the response of poverty convergence in a current period, to farm input subsidies that were provided in a prior period, to understand if the programs build sustainable welfare resilience among poor households. We analyse the convergence in two opposing land rights regimes: matrilocal settlements where only women hold rights to land, and patrilocal settlements where only men hold rights to land. Matrilocal and patrilocal settlements offer varying incentives to household heads, who are often men, of investing in familial land. We find that farm input subsidies lead to poverty convergence, only in settlements where men hold rights to land and receive the subsidies on behalf of their households. Poverty convergence is non-responsive to the subsidies in settlements where men receive the subsidies on behalf of their households, while women together with their extended families, hold rights to the land. We further find that the impact of farm input subsidies on poverty convergence is significant in a year when Malawi faced drought, suggesting that the subsidies built sustainable resilience, against an unanticipated climatic shock, in poor households. The paper calls for anti-poverty policies to target poor people while paying attention to their landholding traditions shared prosperity, is to be achieved.