Land Reform, Property Rights and Private Investment: Evidence from a Planned Settlement in Rural Tanzania

Abstract

We investigate the mass resettlement of rural population in Tanzania that occurred in early 1970s. The policy was implemented to strengthen the role of the state in establishing villages for communal production and development. The villagisation process that followed was implemented with unclear goals, haste and at some point coercion that it was unlikely to bring any short-term improvement in the rural economy. We exploit a recent survey data to examine the impact of the ujamaa operation on farming activities. Our findings show that areas affected by the villagisation in which proprietary rights in land were given to households had significantly better transferability rights and had made significant investments in land. We detect improvement in access to rural credit market and a closing gender gap in land ownership.