Pursuit of the objective of economic efficiency requires security of land tenure, security at least in the basic sense that (a) society recognizes an individual's claim to the land, and (b) legal or other institutional mechanisms exist to defend that claim without normally incurring undue
Examples of Facets of Property Rights
• A right to use the property and prevent others from using it.
• A right to control how property is used (a community may exercise zoning control).
• A right to derive income from a property.
• Immunity from expropriation.
• A right to transmit a property to heirs.
• A right to transfer all or part of a property to others.
• A residuary right that takes effect when other rights lapse (i.e. owners may reclaim use of property when leases end).
• Rights in perpetuity or rights delimited in time.
• Contingent rights to ownership, such as those held by a creditor.
(Adapted from Land Tenure Service, FAO,
31. Gerald A. Carlson, David Zilberman and John A. Miranowski, Agricultural and Environmental Resource Economics, Oxford University Press, New York and Oxford, 1993, p. 406.
32. Reprinted from Journal of Development Economics, 33, B. A. Larson and D. W Bromley, 'Property rights, externalities, and resource degradation', pp. 237-238, Copyright (1990), with permission from Elsevier.
costs. Tenure security in turn requires clarity in defining a user's right to the land, and stability of that right over time. Inadequately defined property rights have been blamed for many of the problems encountered by developing countries and transition economies.33 With reference to Africa, Platteau has said 'efficiency and equity costs may arise equally [whenever] land laws are vague, use confusing or non-operational concepts, are badly applied or frequently modified, leave too much room for arbitrary decisions or involve too heavy procedures'.34 Conversely:
.. . efficiency requires individual land rights to be recognized in a way that provides sufficient security (either in the form of long-term leases or land titles). That stage may not have been reached yet in parts of sub-Saharan Africa. But in other parts (sometimes only a region within a country), the justification for a change in land arrangements already exists.35
Feder and Noronha draw a distinction between security of the right to use a given plot of land and security in the stronger sense of also being able to transact the land. This distinction further illustrates the fact that land rights are rarely absolute:
The term 'security' is often misunderstood in the literature. When it refers to the ability to use land for a certain period and for a defined purpose without disturbance, security of possession is usually ensured under indigenous systems. It is clear that in most sub-Saharan African societies, land under cultivation by an allottee cannot be taken away. Eckert (1980)36 notes that in Lesotho the average period of landholding is eighteen years which, adds Doggert, is 'more than that prevailing in the United States'.37
The situation, however, is entirely different when security is defined as the ability of an occupant to undertake land transactions that would best suit his interests - for example, to offer land as collateral for a loan.38
Different facets of tenure security have been described by Munro-Faure et al. in the following terms:
Tenure security complements access to land by providing confidence that a person's claims to rights will be recognized by others in general and enforced in cases of specific challenges. Security implies certainty; the counterpoint of security is the risk that rights will be threatened by competing claims, and even lost as a result of eviction. . . .
Tenure security can be interpreted in several different ways. Security directly relates to protection from loss of rights. For example, a person may have a right to use a parcel of land for a 6 month growing season, and if that person is safe from eviction during the season, the tenure is secure.
By extension, tenure security can related to the length of tenure, in the context of the time needed to recover the cost of investment. Thus the person with use rights for 6 months will not plant trees, or invest in erosion prevention measures and irrigation works as the time is too short for that person to benefit from the investment. The tenure is insecure for long-term investments even if it is secure for short-term ones.
33. A. Schleifer, 'Establishing Property Rights', in Proceedings of The World Bank Annual Conference on Development Economics, World Bank, Washington, DC, 1994, p. 93.
36. J. Eckert, Lesotho's Land Tenure: An Analysis and Annotated Bibliography, Lesotho Agricultural Sector Analysis Project Special Bibliography 2, Lesotho Ministry of Agriculture and Department of Economics of Colorado State University, Maseru, Lesotho and Fort Collins, CO, USA, 1980.
37. Clinton L. Doggett, Jr, Land Tenure and Agricultural Development in Lesotho and Swaziland: A Comparative Analysis, Bureau for Africa, US Agency for International Development, Washington, DC, USA, 1980.
The importance of long-term security has led some to argue that full security can arise only when there is full private ownership (e.g. freehold) as under such tenure, the time for which the rights can be held is not limited to a fixed period. It is argued that only an owner enjoys secure rights, and holders of lesser rights, such as tenants, have insecure tenure because they are dependent on the will of the owner. It is then implied that security of tenure comes only with holding transfer rights, i.e. rights to buy, mortgage, etc. Equating security with transfer rights is true for some parts of the world but it is not true in many others. People in parts of the world where there are strong community-based tenure regimes may enjoy tenure security without wishing to sell their land, or without having the right to do so, or having strictly limited rights to sell, for example, sales may be restricted to members of the community.39
Tenure security in the sense of being certain to be able to use the land for a given period, and to an extent being able to transfer it, can be provided by customary land tenure systems:
The individual use rights characteristic of most African land tenure systems are most often secure.. . . They tend to be heritable. .. . Many African customary land tenure arrangements permit land transfers, and this tendency has increased with greater integration of rural areas into the market economy. Borrowing, pledging,40 renting and selling are widespread and often have been for some time. . . .41
The tenure security characteristic of customary rights has been summarized by Platteau:
There is another important aspect of customary rights in sub-Saharan Africa that has been largely misunderstood by those holding the conventional view about the present inadequacy of these rights. Indeed as it is now admitted by many authors . . . security of tenure was usually quite satisfactory under traditional African systems of land rights. . .. except in extreme circumstances (as in the case of open conflict with the customary authorities or other extraordinary conditions justifying the exclusion of an individual from his social group), the allottee's right to use a given piece of land is safeguarded as long as he keeps cultivating it. In Lesotho, the chiefs and their subjects are even reported to be confident today that 'land would be reallocated only after several years' neglect, however keen population pressure and the demands or rival claimants might be' (Robertson, 1987).42 Moreover .. . cases were not rare where the heirs are given the lands that were (more or less intensively) cultivated at the time of the death of allottees, even though their rights do not generally extend to lands which had been cultivated by the same but were under fallow when they died.43
Customary land tenure systems display considerable variety, and in some instances the rights extend only to plots of a size to cover subsistence needs and little more. Customary rights normally cannot serve as collateral to raise bank financing for investments because sale outside the community is not permitted. In this regard, customary access to land may be strictly tied to membership in a rural community. Such land cannot represent an economic asset whose value could be transferred to other sectors, as for an investment in starting up a small business in an
39. P. Munro-Faure, P. Groppo, A. Herrera and D. Palmer, 2002, pp. 18-19.
40. 'Pledging' is transferring use rights of the land for a temporary, but often extended, period in exchange for a loan.
42. A. F. Robertson, The Dynamics of Productive Relationships - African Share Contracts in Comparative Perspective, Cambridge University Press, Cambridge, UK, 1987 [emphasis added].
urban area, nor can it generate much wage labor in rural areas:
In customary tenure, farming is not a business but a way of life for the people. Therefore customary tenure only ensures a greater utilization of available labor. The strength of privatized tenure is greater employment creation for wage labor.44
Nevertheless, the point to be recognized is that customary systems may provide a degree of tenure security which is considered satisfactory for most production purposes. Chinene et al. summarize well the differences between customary and modern tenure, for the case of Zambia, but in words that are applicable elsewhere:
Customary tenure has by and large been more successful than [long-term] leasehold tenure in meeting the needs of the people. The administrative procedures are simple and easily implemented. Land issues are dealt with efficiently and decisively. The problem, however, is that the land rights are never registered, although their recognition guaranteed. .. .
Leasehold by its nature facilitates adoption of business approaches to farming. Because of the length of the lease, long-term investments are encouraged. The income-generating potential is therefore higher than under customary tenure. Greater access to markets facilitates income generation on [leasehold] land.
A major advantage of leasehold tenure over customary tenure is that titles facilitate land sales which both generate income and move land resources to efficient producers.45
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