Part I: A Precondition for Sustainable Economic Development
By Jawied Nawabi, Guest Blogger
This is the first part of a two-part series. This installment discusses conventional approaches to the agrarian sector in economic-development theory and policy, and their failings. Part II, to be posted next week, focuses on the socio-economic case for land reform, and it role in successful economic development experiences. Originally published in the May/June 2015 issue of Dollars & Sense magazine.
It is in the agricultural sector that the battle for long-term economic development will be won or lost. —Gunnar Myrdal
The phrase “land reform” often conjures up memories, for those leaning right, of frightening extreme-left ideologies. On the progressive left, meanwhile, land reform is often treated as a passé topic.
With the advent of rising inequality, climate change, weak government institutions, failed states, terrorism, corruption, and a whole slew of other socio-economic problems—sown or exacerbated by three decades of neoliberal policies in the “developing world” (Global South)—it is high time we revisit the issue of land reform. We need to bring it back to the center of the discussion on sustainable economic development. Land reform is not political extremism; rather, it is a critical policy mechanism for the world to address issues of poverty, hunger, urban slums, and good governance.
What is “land reform”? It is usually defined as the redistribution of large landholdings to smaller ones. Land is transferred from large landlords to those who have been working the land as tenants (such as sharecroppers) or paid agricultural workers, as well as dispossessed underemployed or unemployed urban workers who migrated from rural areas looking for employment and wound up living in urban slums. That is one model of land reform. Another model is redistribution in the form of rural communes or cooperative or collective farms. A combination of the two models is also possible.
| Land Reform and Colonization
If we broaden the concept of land reform, the whole process of colonial settlement in North America, Central and South America, Australia, and New Zealand was one big land reform, appropriating the lands of indigenous peoples and distributing it to the European settlers. So land reform can be understood as a much more common experience of the “developed” world than it is usually thought of in the economic literature. |
Reemergence of Land Reform Movements
Despite the attempts by international institutions (like the IMF and World Bank) and oligarchic political elites in the global South to suppress land reform policies, there have been growing social movements pushing for land reform in the last two decades. Neoliberal “free trade” policies have exposed small farmers to devastating global competition (especially from giant mechanized industrial farms in the global North), leaving hundreds of millions of them dispossessed, and have forced them into the reserve army of impoverished unemployed or underemployed living in urban slums. From Brazil and Mexico to the Philippines and Zimbabwe, social movements for a more just and fair distribution of wealth—particularly land—are confronting these devastating consequences of neoliberalism.
Social protest has led even elite institutions such as the World Bank to acknowledge the issue. The Bank’s World Development Report 2008: Agriculture for Development, at least rhetorically put agriculture and the productivity of small farmers “at the heart of a global agenda to reduce poverty.”
Agriculture as a Technical Problem?
The central tendency of mainstream economic development theory since the 1940s and 1950s has been to view agriculture as a mere stepping stone towards industrialization. Economist Arthur W. Lewis’ “dualist” model was particularly influential in casting agricultural labor in developing countries as redundant—with a “surplus” of workers adding little or nothing to agricultural production. This surplus labor force, Lewis argued, should be moved out of the agricultural sector—this would supposedly not reduce output—and into the industrial, which he viewed as the key sector of the economy.
Besides moving inefficient peasants out of the rural sector, mainstream development economists proposed to boost agricultural yields by consolidating small farms into large ones—supposedly to take advantages of economies of scale. Thus, instead of reducing land concentration, this would increase it, essentially accomplishing a reverse land reform. Such an industrial model of agriculture would use expensive capital equipment (imported from the global North), petroleum-based fertilizers, herbicides, and pesticides. Today’s version of the model increasingly pushes the adoption of genetically modified seeds controlled by corporations like Monsanto.
During the 1960s and 1970s, this frame of thought led many international institutions (such as the World Bank, Asian Development Bank, etc.) and governments in the global South to embrace the “Green Revolution.” The Green Revolution was essentially a plan to use “science and technology” to increase crop production in developing countries. The use of fertilizers, pesticides, and high-yield crop varieties was supposed to boost agricultural productivity, reduce rural poverty, solve problems of hunger and malnutrition, and thus avoid peasant movements and rural political instability. This was, as economists James M. Cypher and James L. Dietz put it, a “strategy wherein it was hoped that seed technologies could be substituted for missing land reform and for more radical ‘red revolutions’ of the socialist variety threatening to sweep across the globe at the time.”
Viewing agricultural productivity as a purely technical problem, advocates of the Green Revolution did not aim to transform the structure of land inequality and landlord power. To take the case of India, the Green Revolution boosted agricultural yields, making the country technically self-sufficient in food production. However, the changes primarily benefited medium and large-sized landowners who used capital-intensive technologies, high-yielding mono-crop seeds, and large inputs of fertilizers and pesticides. “Rural inequity worsened because of the growing prosperity of the large and medium farmers and the unchanged position of the landless and small farmers,” concludes Indian scholar Siddharth Dube. “And because large farms use more capital and less labour per unit of produce than small farms, rural employment grew much less than it would have if land reform had taken place and the increase in production come from smaller farms.”
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