Poorly specified and weakly enforced property rights over land may reduce productivity in the agricultural sector. This column examines why strong private property rights are not adopted more widely, and offers a theory of the determination of rural property rights institutions.
In many less-developed countries, property rights over land are poorly specified and weakly enforced. More specifically, rural areas in developing countries throughout history, and even today, often have more than one regime of property rights and production. A relatively ‘modern’ group of ‘capitalist’ landowners with large, privately owned farms coexists with a ‘traditional’ or ‘subsistence’ group of peasants who work on small plots and have limited property rights...