Agriculture still plays a vital role in reducing poverty in most developing countries. But which factors are important for ensuring that agricultural growth helps people to escape from poverty? And what role does land tenure play in this relationship?

Based on background work for the second Chronic Poverty Report, a paper from the Overseas Development Institute in the UK summarises findings from Vietnam, Uganda, India, Nicaragua and Ethiopia. The researchers examine how people escape from poverty (referred to as poverty exits), how this relates to agricultural growth trends and the factors that promote poverty exits. The paper then describes recent work on the relationship between land tenure and agricultural productivity.

The research shows that agricultural growth does not ensure ‘exits’ from poverty. Of the countries studied, Nicaragua had the highest agricultural growth rate (5.1 percent), but also the highest levels of chronic poverty and the lowest exit-to-entry ratio (a figure which describes how many people moved into and out of poverty).

Vietnam and Uganda had the greatest success in reducing chronic poverty, and had the highest exit-to-entry ratios. Whilst both countries enjoyed good agricultural growth rates (3.8 percent), this was not much higher than the agricultural growth rates in Ethiopia and India, who had less success in lowering poverty levels.

So which factors help to translate agricultural growth into less poverty? The researchers identify three factors (‘pillars’) that make poverty exits possible:

• Economic infrastructure, such as successful investments in irrigation and road infrastructure.
• Education, which can contribute to increased on-farm productivity, diversification into non-farm activities, and successful migration to urban or other rural areas.
• Information on job opportunities, markets and farming techniques. These can be from state extension services, private organisations and non-governmental organisations.

Access to land is also crucial for escaping poverty. However, opinions are divided on what form this should take. Some researchers believe freehold titles (when an individual not only has the rights to use the land, but also owns it) boost security and productivity. They argue that freehold titles promote the adoption of new technology and the use of loans.  

However, others think that the link between tenure status and agricultural productivity is not clear. They claim that a lack of credit, knowledge and labour affects productivity more than tenure status. Furthermore, some argue that:

• Customary tenure, where communities exercise rights over land rather than individuals, is an important source of protection (especially from eviction), and is often flexible enough to adapt to market conditions.
• Land rental markets can offer poor people fast, affordable access to land and bring under-used land into production.

The researchers conclude that reforming land tenure to increase productivity does not necessarily require freehold land titling. While providing productive land to poor people may be necessary to reduce poverty in some cases, it should be supplemented by state and non-state investments in the three ‘pillars’.

Source(s):
‘Making Agriculture Work for the Poor’, Overseas Development Institute, Natural Resource Perspectives 111, ODI: London, by Martin Prowse and Admos Chimhowu, 2007 (PDF) Full document.

Funded by: This Natural Resource Perspective summarises background work for the second Chronic Poverty Report. The Chronic Poverty Report is the main policy engagement tool of the ‘Chronic Poverty Research Centre’, an international partnership of universities, research institutes and non-governmental organisations, established in 2000 with initial funding from the UK's Department for International Development; The background papers on Vietnam, Uganda, India, Nicaragua and Ethiopia were funded by BASIS-CRSP, University of Wisconsin-Madison) and ADA (Austria); Natural Resource Perspectives are funded by the Swedish International Development Cooperation Agency (Sida)

id21 Research Highlight: 9 March 2008

Further Information:
Martin Prowse
Overseas Development Institute
111 Westminister Bridge Road
London, SE1 7JD
UK

Tel: +44 207 9220300
Fax: +44 207 9220399
Contact the contributor: m.prowse@odi.org.uk

Overseas Development Institute

Other related links:
'Does low external input agriculture reach the poor?'

'Fighting hunger with free agricultural inputs: the experience of Starter Packs in Malawi'

'Can land redistribution help reduce rural dependency in South Africa?'