Political economy of agrarian change

Introduction

Are redistributive land reforms possible and if so are they desirable today?

Land reform (LR) is defined as a ‘legislation intended and likely to redistribute ownership of current farmland, and thus benefit the poor by raising their absolute and relative status, power, and/or income, compared with likely situations without the legislation’ (Lipton, 2009:124). Thus, land-based wealth and power are transferred from the monopoly control of private landed class to landless working poor. This, however, is far from being universal. LR has had a rollercoaster ride in the toolbox of development strategies from a panacea that would cure all ills and help replicate the successes of Japan and Korea, to venom that destroys property rights and creates unviable production units that lead to agricultural decline and urban migration as it has purportedly done in Latin America. The issue of LR is indeed complex and nuanced. A deeper understanding of LR, therefore, is imperative. This essay discusses the desirability and possibility of LR. On one spectrum, it will argue for the desirability of land reform in terms of efficiency and poverty reduction. On the other spectrum, it will venture arguments for the possibility of LR. It concludes that LR remains alive, active and acts as a beacon of hope for those with limited or no access to land.

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This essay begins assessing the possibility of LR in contemporary developing countries. It argues that LR is not only possible but an ongoing battle. It is back on the policy agenda of international development institutions since the 1990s and has not disappeared since then (Borras, 2010). It was in the mid-1990s when land struggles caught the attention of the world. Three of these were the most important, the Chiapas uprising in Mexico, the state-investigated land invasions by black landless poor of white commercial farms in Zimbabwe, and the resurgence of militant peasant land occupations in Brazil reminiscent of the actions by the peasant land of the 1950s but much greater in scale and political sophistication (Akram-Lodhi et al, 2007). While the international development community grappled with the meanings and implications of such complex conflicts, trans-national agrarian movements (TAMs) emerged (Borras, 2010). La Via Campesina (VC) is to be mentioned, beside the International Federation of Agricultural Producers and the IPC for Food Sovereignty. VC, for example, is an international movement of poor peasants and small farmers from the global South and North, which was established in 1993 as a critical response to neoliberalism and which is still very much active today (Ibid, 2010).

VC validates what Ronald Herring (2003) observed, namely that LR was taken off the ‘policy agenda’ of national and international agencies in the 1980s, but never left the ‘political agendas’ of the peasants and their organisations. Herring explained that ‘even dead LR are not dead; they become nodes around which future peasant mobilisations emerge because promises unkept keep movements alive’ (Ibid, 2003: 123). Today, as in the case 50 years ago, severe poverty remains mainly rural with extreme land inequalities. As the World Bank study in 2003 shows 17.8% of the population in East and South East Asia live under 1.25$. The figure however is much higher for Latin America (38.6%) and drastic in Sub-Saharan Africa (50.3%).

Further, though the LR thrust weakened from the mid-1970s, observers (de Janvry and Sadoulet,1989) saw factors tending to revive it. First, form the mid-1980s, spreading democracy and political organisation led to civil-society activism, including land invasions to press for enforcement of unimplemented LR laws (Binswanger-Mkhize, 2009). Second, growth of new markets induced many giant, near-feudal haciendas to become commercial farms; turned tied workers from feudal workers into casual, part-time employees, who are freer to press for LR (Bernstein, 2003). Third, in faster-growing countries, urban growth shifted visible poverty priorities at national levels from farms towards cities (Lipton, 2009). Thus, internal dynamics – urbanisation, unequal land and power distribution, and the expansion of democratic-consciousness among the rural population – supported, rather than kill, LR in twenty-first century.

Since the Mexican revolution of 1910, internal dynamics decide whether LR slows, pauses, resumes or accelerates. Sometimes it was seen as complete, either having reached its limits or succumbed to limitations, mainly underperformance and unpopularity due to collectivist rather than distributives approaches (Olsen, 1971). But in no country did LR quite die or became impossible rather it has resumed or speeded up. Indeed in some countries LR sputtered on with many stops and starts. The timing of slowdowns or reversals varied, from 1910 in Mexico or 1973 in Chile. The timing of resumption or acceleration also varied, from the early 1990s in Brazil to 2006-08 in Bolivia and Venezuela (Sen, 1997). Many huge farms have partly transformed from haciendas to partly modernised commercial farms but gross, growth-inhibiting, and largely inherited land inequality remains unaddressed – making LR vital and crucial as ever.

LR, therefore, is not impossible. Much had happened; some is happening now; more remains relevant and likely. Globally, LR recedes and advances, is fulfilled or abandoned, inspires new pressures and programmes or becomes dormant with old ones.

Since LR is still not only possible today but also a burning issue, the question now is whether it is also desirable. Opponents of LR, for example, Lipton (2008) argue that with increased expansion of capitalism, large farms become more suitable than small farms – rendering LR superfluous. Worldwide, rapid technical change and globalisation confront farmers with transformed processing and marketing arrangements, often impinging on production. Larger farms are considered under these circumstances as more efficient, thus advantages of smallness are reversed by economic development, globalisation and supermarkets. Moreover, it is argued that LR is internally inconsistent often due to loopholes inserted by lawmakers under pressure from large landowners (Ibid, 2008). LR, so argued, gives ‘too’ much power to the state so that the goal of putting control of land in the hands of the poor is subverted, and the reform abused to extract enforced surplus from rural people, including the poor. Also argued is that LR is politically infeasible because political and social costs of implementation far exceeds benefits of reform (Rashid and Quibria, 1995).

Yet, all these arguments considered are as amiss. There are two different discourses arguing in favour of LR. The one is Marxist, positivist, evolutionist, the other, neo-liberal and technocratic (Borras et al, 2010). The one has developed in Eastern and Central Europe during the late nineteenth century; the other after World War II in the technocratic language of development policy. Both traditions have resonances in today’s LR debate, however with competing political ideologies, reasoning, and conclusions. While it must be acknowledged that the debate about LR also includes institutional economics or livelihood economics, a further inquiry thereof is beyond the scope of this essay (Cousins et al., 2010).

The main neo-liberal argument for LR lies in the inverse-relationship paradigm (IR) (Deiniger, 1999). The rationale is that small scale farmers are residual claimants to profits and have an incentive to provide greater efforts in the process of production. The reason for this is the following: small farms have advantages in managing labour, but larger farms in managing capital. Capital and large-farm advantage loom larger as a source of higher land productivity in developed, labour scarce rural areas; labour, and small-farm advantage, count for more in developing, capital scarce countries. Griffin, Khan and Ickowitz (2002) conclude that since the ratio of interest rates to wages is relatively low in large farms with access to credit, they tend to adopt relatively more capital intensive method of production. Small farmers on the other hand, so argued, tend to have worse access to capital and therefore tend to economize on it by adopting relatively more labour intensive technology. Small farmers, therefore, generate more employment. Since the factor proportions are typically skewed in favour of labour as the abundant, small farms utilize resources more efficiently. Following this line of reasoning, there appears to be a clear policy outcome; economic policies should be geared towards reallocating land away from large farm holdings to small family farms since it is the most effective means of boosting efficiency and output.

The desirability of LR based on IR, however, is disputable. Today, it is assumed that the connection between size and productivity is fallacious – even among neo-liberal economists. While the World Bank supported the IR in 1975, it now claims that ‘land ownership ceiling have been generally ineffective…to facilitate the break-up of big farms, and instead have led to red tapes, spurious subdivisions, and corruption’ (Binswanger-Mkhize, 2009). To argue further, IR paradigm suffers from methodological shortcomings – semantic relativism. What is a ‘small’ farmThere is no general consensus on this and it varies with each case study on IR. For example, Van Zyl (1996) conducted a study into South African agriculture in which he stated that, ‘significant efficiency gains can be made if farm sizes in the commercial sector become smaller (in Sender and Johnston, 2004:152). However, the definition of a ‘small farm’ used in this study was one with over 500 hectares. To argue that a 500 hectare farm is a ‘small’ scale farm is preposterous when compared to a small farm in Bangladesh which normally counts for 1-2 hectare (Khan, 2004). The term ‘small’ is used ambiguously in many investigations into agriculture and productivity. Therefore, until there is a clear definition of what constitutes a ‘small’ farm, it is difficult to accept evidence about higher productivity on ‘small’ farms without a pinch of salt.

Second, IR suffers from theoretical limitations. IR ignores peasant differentiation and differences in land quality (Byres, 2004b). Small peasants are not heterogeneous. In each size group, some farms are run and worked by kin, others by employees; some are remote, others peri-urban; some have favourable land, others not, some are well-managed, others not. Simple measures, which regress annual farm output per hectare against farm size, miss out these factors. In statistics term, the ‘bivariate’ IR hides ‘missing variables’, and thus hides ‘unobserved heterogeneity’ within farm size-groups (Dyer, 2004). Moreover, smaller farms may have higher output per hectare, not because of its smallness, but because of its higher land-water quality (Ibid, 2004). Small farm land with poor soil quality can not be a guarantee for higher agricultural output.

The desirability of LR from a Marxist perspective, however takes a different stance. According to political economists, LR’s desirability lies in its contribution to the resolution of the agrarian question (AQ). The AQ constitutes ‘the continued existence in the countryside, in a substantive sense, of obstacles to an unleashing of accumulation in both the countryside itself and more generally — in particular, the accumulation associated with capitalist industrialisation’ (Byres, 2004a).Byres’ definition demonstrates the historical contribution of LR to develop capitalist economies. It was LR that unleashed the forces of production necessary for a ‘primitive accumulation’ by eroding feudal and semi-feudal relations of production and replacing them with a class of capitalist farmers and one of wage labourers. The resolution of the AQ was achieved in a variety of ways, ‘from above’, as in the case of nineteenth century Prussia, where a land owning class metamorphosed into an agrarian capitalist class, or ‘from below’ in America, where peasants differentiate themselves over time into classes of agrarian capital (Ibid, 2004a). To destroy the power of pre-capitalist property class, LR is required. The function of LR in this context, therefore, lies in its contribution as the promoter of capitalism in pre-capitalist areas.

Contemporary AQ, however, is centred on the crisis of the reproduction of increasingly fragmented classes of labour within a capitalist system (Bernstein, 2009). Here, the desirability of LR is argued on the basis of securing the livelihood of peasants. Land is seen as ‘a basic livelihood asset, the principal form of natural capital from which people produce food and earn a living’ (Cousins et al 2010:32). Land also ‘provides a supplementary source of livelihoods for rural workers and the urban poor’ and ‘as a heritable asset, land is the basis for the wealth and livelihood security of future rural generations’ (Ibid, 2010:33). Moreover, Kay (1988) buttresses LR by arguing that small-scale farming is multiplier-rich. LR enhances growth for the overall economy because family farmers spend more of their incomes in the locally produced goods than do larger farms, creating a positive relationship between family farms and non-farm incomes in the local economy. In China, for instance, access to land enabled peasants to take increased risk and move into non-farm activities which produced the boom in small-scale entrepreneurship (Bramall, 2004). From a Marxist perspective henceforth, desirability of LR not only results in capital accumulation but in improved prospects for the livelihood security of differentiated classes of labour, for whom farming may be only one source of income.

So far we have considered the desirability of LR entirely from an economic perspective. Leaving this aside, LR has also major socio-political implications – buttressing the desirability argument. Advocates of political LR, appreciate, for instance, the dissolution of feudal relationships of production and excessively concentrated and exploitative elite power structures (Bhaduri, 1973). While the main goal of land reformers is to enhance the rural poor’s access to land, it is also to reduce poverty, inequality, and to increase liberty (Sen, 2001). Having land on their own, the poor rely less on non-farm employment, emergency loans, or trade with local ‘rural tyrants’ (Hall, 2004) who are almost always major land controllers, but often also employers, landlords, lenders with interlocking market power over things that the local poor can neither live without nor, in many cases readily get elsewhere. Political LR, also include the creation of political stability and peace. In post-conflict situations, this would suggest a focus on provision of land to war-veterans and people displaced by war. In Zimbabwe, for instance, LR focused on white-owned farms and exempted black owners from expropriation (Jacobs, 2000). In post-colonial situations, the political LR also included correcting the racial imbalance in land ownership (Algeria, East-Southern Africa) and empowering members of the new elite (Kenya and Zimbabwe) (Lipton, 2004). Therefore LR, apart from having economic benefits, contributes to unlock many of today’s rural societies from quasi-feudalism.

LR – its desirability and possibility – has been hotly debated among various economic ideologies. Yet, in a world of continuing poverty and inequality, slow agricultural growth, changing economic structures, rapid urbanisation, profound challenges of climate structures, and rapid urbanisation, institutions, policies and pressures concerning access to and use of land are as important as ever. In the past century, LR played a central role in the time-paths of rural and national poverty, progress, freedom, conflict, and suffering. Arguing that LR is ‘passe’- is therefore erroneous. And such thinking underrates the reach of LR. LR, like education or tax reform, is a thrust towards more equitable and efficient distribution. The thrust weakens or strengthens with economic situations and power balances, but does not become impossible. For the next half-century at least, where agriculture continues central to the lives of the poor, the role of LR will not decline. Indeed growing populations, scarcer land, and the low and falling employment intensity of non-farm growth may well increase pressures for and resistance to LR. Although, it carries the potential for severe land conflicts, it nevertheless permits huge gains, in terms of liberty and peace as well as growth and reduced inequality.

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