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Impact of Land Certification on Land Rental Market Participation in Tigray Region, Northern Ethiopia

Author

Listed:
  • Holden, Stein T.
  • Deininger, Klaus
  • Ghebru, Hosaena

Abstract

There is a renewed interest in whether land reforms can contribute to market development in Africa and whether land reforms can be pro-poor. This paper uses unique household panel data from Tigray region in Ethiopia to assess the impact of the 1998 low-cost land registration and certification reform on land rental market participation over a period of eight years after the reform, using random effects probit and tobit panel data models for land leased out and leased in, while correcting for unobservable heterogeneity and endogeneity of having certificate. The analysis revealed that the land reform contributed to increased land rental market participation. Female-headed households became more willing to rent out land and making land available for more efficient producers. Average areas leased out and leased in increased after certification. The land rental market remained characterised with significant and non-convex transaction costs also after the reform as evidenced by significant state dependence, a low response to own holding size and a high share of non-participation in the land market, leaving room for further improvement.

Suggested Citation

  • Holden, Stein T. & Deininger, Klaus & Ghebru, Hosaena, 2007. "Impact of Land Certification on Land Rental Market Participation in Tigray Region, Northern Ethiopia," MPRA Paper 5211, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:5211
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    File URL: https://mpra.ub.uni-muenchen.de/5211/1/MPRA_paper_5211.pdf
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    References listed on IDEAS

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    1. Finan, Frederico & Sadoulet, Elisabeth & de Janvry, Alain, 2005. "Measuring the poverty reduction potential of land in rural Mexico," Journal of Development Economics, Elsevier, vol. 77(1), pages 27-51, June.
    2. Holden, Stein T. & Bezabih, Mintewab, 2006. "Tenure Insecurity, Transaction Costs in the Land Lease Market and their Implications for Gendered Productivity Differentials," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25273, International Association of Agricultural Economists.
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    4. Ravallion, Martin, 2008. "Evaluating Anti-Poverty Programs," Handbook of Development Economics, Elsevier.
    5. Deininger, Klaus & Ali, Daniel Ayalew & Holden, Stein & Zevenbergen, Jaap, 2008. "Rural Land Certification in Ethiopia: Process, Initial Impact, and Implications for Other African Countries," World Development, Elsevier, vol. 36(10), pages 1786-1812, October.
    6. John Pender & Marcel Fafchamps, 2006. "Land Lease Markets and Agricultural Efficiency in Ethiopia," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 15(2), pages 251-284, June.
    7. Teklu, Tesfaye & Lemi, Adugna, 2004. "Factors affecting entry and intensity in informal rental land markets in Southern Ethiopian highlands," Agricultural Economics, Blackwell, vol. 30(2), pages 117-128, March.
    8. Clive Bell & Chalongphob Sussangkarn, 1988. "Rationing and Adjustment in the Market for Tenancies: The Behavior of Landowning Households in Thanjavur District," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(4), pages 779-789.
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    Citations

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    Cited by:

    1. Derek Stacey, 2011. "Tenure Insecurity, Adverse Selection, and Liquidity in Rural Land Markets," Working Papers 1269, Queen's University, Department of Economics.
    2. Hallward-Driemeier, Mary & Gajigo, Ousman, 2015. "Strengthening Economic Rights and Women’s Occupational Choice: The Impact of Reforming Ethiopia’s Family Law," World Development, Elsevier, vol. 70(C), pages 260-273.
    3. Sebastian Galiani & Ernesto Schargrodsky, 2011. "Land Property Rights and Resource Allocation," Journal of Law and Economics, University of Chicago Press, vol. 54(S4), pages 329-345.
    4. Quisumbing, Agnes R. & Pandolfelli, Lauren, 2010. "Promising Approaches to Address the Needs of Poor Female Farmers: Resources, Constraints, and Interventions," World Development, Elsevier, vol. 38(4), pages 581-592, April.
    5. Meinzen-Dick, Ruth Suseela & Johnson, Nancy & Quisumbing, Agnes R. & Njuki, Jemimah & Behrman, Julia A. & Rubin, Deborah & Peterman, Amber & Waithanji, Elizabeth, 2011. "Gender, assets, and agricultural development programs: A conceptual framework:," CAPRi working papers 99, International Food Policy Research Institute (IFPRI).
    6. Ma, Xianlei & Heerink, Nico & van Ierlan, Ekko & Lang, Hairu & Shi, Xiaoping, 2015. "Impact of Tenure Security and Trust on Land Rental Market Development in Rural China," 2015 Conference, August 9-14, 2015, Milan, Italy 212219, International Association of Agricultural Economists.
    7. Kumar, Neha & Quisumbing, Agnes R., 2015. "Policy Reform toward Gender Equality in Ethiopia: Little by Little the Egg Begins to Walk," World Development, Elsevier, vol. 67(C), pages 406-423.
    8. Gebru, Menasbo & Holden, Stein T. & Tilahun, Mesfin, 2017. "Can the land rental market facilitate smallholder commercialization? Evidence from northern Ethiopia," CLTS Working Papers 10/17, Norwegian University of Life Sciences, Centre for Land Tenure Studies.
    9. Quisumbing, Agnes R. & Kumar, Neha, 2014. "Land rights knowledge and conservation in rural Ethiopia: Mind the gender gap:," IFPRI discussion papers 1386, International Food Policy Research Institute (IFPRI).
    10. Behrman, Julia & Meinzen-Dick, Ruth & Quisumbing, Agnes, 2011. "The gender implications of large-scale land deals:," IFPRI discussion papers 1056, International Food Policy Research Institute (IFPRI).
    11. Markussen, Thomas, 2008. "Property Rights, Productivity, and Common Property Resources: Insights from Rural Cambodia," World Development, Elsevier, vol. 36(11), pages 2277-2296, November.
    12. Stephen O'Neill & Kevin Hanrahan, 2010. "The importance of accounting for unobserved heterogeneity, state-dependence and differences in residual variances across groups: An application to Irish Farmers land market participation decisions," Working Papers 1005, Rural Economy and Development Programme,Teagasc.

    More about this item

    Keywords

    Land certification; land rental market; panel data analysis; unobserved heterogeneity; household response; female-headed households;

    JEL classification:

    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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