…asset transfers (such as land redistribution) can be an effective anti-poverty tool. Not only should they be constrained by fewer questions about work disincentives than are cash transfers, they should be able to generate very high rates of return if they succeed in unlocking the productive potential of the poor
…Despite this promise, well-identified empirical evidence of efficacy of land redistribution has been scarce, in no small part because the most interesting reforms arise endogenously, either as a response to, or as a cause of, conflict.
…For this paper, we have been able to explore a relatively low conflict situation (South Africa) and exploit the fact that the implementation of its market-assisted land reform program generated a natural experiment
…Standard binary treatment effect estimates indicate that the land transfers boosted household living standards by 25%.
More interestingly, our continuous treatment estimates, which exploits variations in the period of ownership of the redistributed land, show that living standards initially dip with the land transfers, but then after three years rise to levels that imply a 50% increase in living standards of the treated households who entered the program with poverty line standards of living.
A new paper from Malcolm Keswell and Michael Carter.