Development outcomes of land tenure formalization under customary and statutory land tenure systems in Tanzania
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Date
2023-11
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Sokoine University of Agriculture
Abstract
As the global population continues to grow, urbanization and
industrialization have led to a scarcity of land, putting additional
pressure on agricultural land as various competing uses emerge,
such as new settlements, commercial farming, and industrial
establishments. This situation has made smallholders increasingly
vulnerable to poverty, food insecurity, and conflicts due to the loss of
land rights and tenure insecurity. In response to these challenges,
Land Tenure Formalization (LTF) has become a popular policy
approach and a prominent development agenda among
development partners and national governments in the global south.
However, the adoption of LTF interventions has been consistently
low, and the reasons behind this low uptake are not well-
documented in the existing literature.
Where LTF interventions have been implemented, the empirical
evidence on their effects is inconclusive and mixed, leading to
uncertain implications for policy. This ambiguity in results stems from
conceptual and methodological flaws in the treatment of LTF as a
simple dichotomy between formalized and non-formalized land
tenure, as well as issues with identification and the failure to account
for potential complementarities between LTF and other
interventions.
To shed light on these issues, this study utilizes Tanzania's National
Panel Survey data from 2014/2015 to examine the development
outcomes of LTF, making a distinction between customary and
statutory systems in Tanzania. The research specifically investigates
the determinants of LTF using a Multinomial Logit (MNL) model, the
development outcomes of LTF under customary and statutory tenure
systems using a Multinomial Endogenous Switching Regression
(MESR) model, and the potential complementarities between LTF
and the Productive Social Safety Nets (PSSN) cash transfer
program using an Inverse Probability Weighted Regression
Adjustment (IPWRA) approach.
The findings reveal significant differences in the determinants of LTF
across land tenure systems. Factors such as household education level, formal employment status, migrant status, possession of
dwelling certificate, and plot-to-dwelling distance positively and
significantly influence statutory land tenure formalization, while
agricultural occupation status has a negative impact on statutory
land tenure formalization. In contrast, factors like household
education level, rural resident status, farm size, financial assistance,
and village land certificate significantly and positively influence
customary land tenure formalization. However, formal employment
status of the household head, migrant status of the household head,
and purchased plots significantly and negatively influence customary
land tenure formalization. Overall, these results suggest that
Tanzania's LTF interventions are costly, bureaucratic, and tend to
favor educated formal wage earners and migrants, leaving less
educated, indigenous, and full-time farmers, who make up the
majority of households reliant on agriculture, at a disadvantage. This
renders the LTF interventions socially sub-optimal as they attract
speculative rather than productive formalization.
Similarly, the MESR estimates demonstrate that the effects of LTF
differ significantly between customary and statutory land tenure
systems. Possessing formal land tenure certificates, such as
Certificate of Customary Right of Occupancy (CCRO) or Certificate
of Granted Right of Occupancy (CGRO), significantly improves
perceived land tenure security, with the effect being more
pronounced and significant for CGRO holders compared to CCRO
holders. Regarding credit access, the findings show variations in the
effects of LTF on general, formal, and informal credit access. While
there is no significant effect on general access to credit, possessing
a CGRO significantly improves access to formal credit and reduces
reliance on informal credit. Furthermore, regarding land investments,
there are positive and significant effects of LTF on organic and
inorganic fertilizer use, as well as investments in trees and
permanent crops, but only for CGRO plots.
The findings from the Inverse Probability Weighted Regression
Adjustment (IPWRA) analysis reveal that when households
participate jointly in Land Tenure Formalization (LTF) and the
Productive Social Safety Nets (PSSN) programs, there is a significant improvement in farm productivity, households'
consumption expenditure, and food security. Interestingly, the
combined impact of LTF and PSSN is far greater than the sum of
their individual effects, indicating a strong complementarity between
these two programs. While the stand-alone impacts of LTF or PSSN
are positive, they do not show significant effects on all food security
indicators, except for PSSN, which has a slightly significant positive
impact on food consumption scores. Moreover, when analyzing
different tenure systems, the study suggests that the joint impact of
statutory LTF with PSSN is stronger compared to the joint impact of
customary LTF with PSSN, whereas the stand-alone impacts show
the opposite pattern.
Given the evidence of the costly and bureaucratic nature of the LTF
system in Tanzania, there is a clear need for policy reforms and
initiatives that promote more cost-effective, less bureaucratic, and
inclusive LTF systems to achieve more socially optimal outcomes.
Additionally, as the determinants and outcomes of LTF significantly
differ between tenure systems, future empirical studies should
acknowledge and consider this distinction in their conceptualization
and methodologies to provide greater clarity and more meaningful
policy insights.
Considering the proven complementarities between LTF and PSSN
programs, it is highly recommended to design pro-poor agricultural
interventions that integrate complementary packages such as social
protection programs to enhance their impact. Lastly, in light of the
mixed and inconclusive evidence on the effects of LTF, this study
calls for further empirical research to explore and better understand
the potential interactions between LTF and other anti-poverty
interventions, such as credit access, extension services, farm input
subsidies, irrigation, and farm mechanization programs. Such
studies would contribute to improving clarity and generating better
policy implications for poverty reduction and agricultural
development.
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Thesis
Keywords
Land Tenure Formalization, Customary tenure, Statutory tenure, Multinomial logit, Tanzania