Tenure security and productivity in the Zimbabwean small farm sector : implications for South Africa.

Abstract

Within the context of sub-Saharan Africa's rising population growth rate and declining agricultural productivity, there is much debate about whether communal land tenure institutions are a constraint on agricultural productivity and transformation in the region. Some argue that tenure institutions have adapted to the needs of the local communities, while others contend that the evolution of tenure institutions is constrained by the actions of vested interest groups and prohibitive transaction costs. This study empirically tested the relationship between land tenure security and agricultural productivity in the Zimbabwean small farm sector. Specifically, the study investigated the interaction between land tenure security and credit use, long-term on farm investments , complementary short-term input use and yield from a sample of 119 Zimbabwean households interviewed during 1995 . Implications for land reform in South Africa were derived from the empirical results. The study area was stratified so as to maximise the variation on the tenure variables measured. Three strata were identified, namely the privately owned small scale commercial sector, the traditional communal area and the government initiated Model A Resettlement Area. Tenure security was estimated as an index, capturing the breadth, duration and assurance of an individual's property rights to land. A simultaneous equation model was estimated using two-stage least squares regression analysis. Empirical results indicate that households with more exclusive and assured property rights invested significantly more in long-term on-farm improvements, applied greater levels of short-term inputs and attained higher yields compared to households with less secure property rights, ceteris paribus. Credit use was too infrequent in the sample to warrant statistical analysis. Given similarities between the Zimbabwean and South African agricultural sectors, the result has two important implications for proposed land reform in South Africa. Firstly, the result lends support to the notion that communal tenure in South Africa is likely to be a constraint on agricultural development. Secondly, any national land reform policy must be accompanied by innovative tenure institution which facilitate economic interaction and internalise externalities on land resettled to individuals or groups. In this regard, the process of institutional change must be impartially administered and well adapted to the particular needs and resource constraints at community level.