REFORMING PROPERTY RIGHTS IN LAND AND TENANCY

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Abstract
This article examines the nature and distribution of property rights in land and how they are changing under economic and demographic pressures. It also analyzes the practical chances of success of several alternative forms of policy intervention to redistribute property rights and regulate tenancy. This analysis begins with the political economy of land reform in the twentieth century. It draws a distinction between reforms precipitated by social upheaval (defeat in war, social revolution, or national liberation) and those that occur in “normal” times, when the social and political order is more secure. It is argued that the former have been much more important and, drawing on examples, that the latter face formidable obstacles. In this connection, it is proposed that a tax reform which does away with the highly selective subsidies and exemptions that benefit the rich and inflate the price of land should be undertaken first. Then, when land prices have fallen, compulsory purchase of land for redistribution, at close to fair market value to ensure its political acceptability, would not entail an intolerable fiscal burden. Where tenancy is concerned, it is argued that this institution is commonly a socially useful market response, which provides opportunities for the fuller employment of family resources and, over the long run, for individual mobility. Thus interventions designed to inhibit tenancy directly or to transfer ownership-like rights to existing tenants may result in heavy costs, especially for future cohorts of would-be tenants.

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