Submissions Accepted for Presentation at the World Bank Land Conference 2024

Cluster farming is increasingly promoted in Ethiopia as one of the agglomeration models spurring rural development. We examine the role of land as a constraint to the development of cluster-based development in Ethiopia. We further disaggregate farm households based on their landholding to better understand potential heterogeneities. We also document other household socio-economic and network characteristics that may matter in cluster farming. Our findings show a positive association between landholding and cluster farming both at the extensive and intensive margins. We also find suggestive evidence that participation rates are lower for small-scale farms, but also declines for large-scale farms. In addition, we show that access to information and network matter in enabling cluster farming. Our findings are relevant in the framework of plans to upscale the cluster-based development initiative in Ethiopia. Attention to landholding issues is key area where policy action can be geared to boost cluster farming.

The rapid expansion of mechanization services has significantly influenced agricultural production, particularly in developing countries with small farms. This paper investigates how these services affect productivity across different production stages. Utilizing data from 145 wheat farms in Northern China (2013-2020), we analyze inputs and outputs at each stage. Results indicate that while mechanization services generally benefit productivity, they adversely affect the plant protection stage. This stage's inefficiency hampers overall farm productivity, suggesting that carefully selecting mechanization services and providers for each production stage could be crucial for small farms seeking to maximize productivity.

The study employs a farm household-level panel dataset from Nigeria, Ethiopia, and Tanzania to investigate the relationship between property rights and agricultural socio-economic development. The findings reveal a no-relationship between operated land size, capital, and farm Total Factor Productivity (TFP), indicating significant frictions in land and capital markets. These frictions, associated with land institutions favoring less productive farmers, lead to resource misallocation. However, the study demonstrates that securing land rights through certificates facilitates the reallocation of factor inputs to more efficient farms, resulting in positive aggregate effects. Land certificates also promote rentals, reduce misallocation, and enhance agricultural productivity. Furthermore, the research highlights that obtaining a land certificate influences households' decisions to remain in agriculture, indicating a potential link between secure property rights and migration patterns. The overall implication is that implementing a secure property rights system could significantly improve productivity and resource allocation efficiency in agriculture.

We analyze the impact of a 2021 reform in Ukraine that—after earlier digitization efforts did not produce desired results—mandated use of transparent online auctions by local governments rather than a central agency to lease rights to public agricultural land. The shift to a collusion-proof electronic auction system increased lease revenue by 175% for our preferred specification. Had all public land that Ukraine transferred since 2015 been auctioned using postreform mechanisms, local governments would have received incremental lease revenue of US$500 million per year. Where public land is important, reforms to ensure rights to such land are allocated transparently, competitively and in a decentralized way could improve social, economic, and environmental outcomes.