Property rights, factor allocation and household welfare: Experimental evidence from a land titling program in India

Abstract

Increasing evidence shows the significance of de jure land ownership in determining agricultural productivity, yet the causal evidence of the effectiveness of land rights is scarce. We leverage experimental variation induced by nudging Indian farmers to obtain formal land titles. We find that titling increases agricultural investments, crop productivity, and paddy profits. We identify the tenancy security as the potential channel for impact from titling on the labour market and collateral effect for higher investment. Farmers respond to titling by releasing locked-in family labour, and those who obtain land titles make welfare gains and recover the full cost of titling.