The paradox of land reform, inequality and development in Colombia

Produced by: 
London School of Economics
Available from: 
February 2017
Paper author(s): 
Jean-Paul Faguet
Fabio Sanchez
Marta-Juanita Villaveces
Topic: 
Poverty - Inequality - Aid Effectiveness
Year: 
2017

Over two centuries, Colombia transferred vast quantities of land, equivalent to the entire UK landmass, mainly to landless peasants. And yet Colombia retains one of the highest concentrations of land ownership in the world. Why? We show that land reform’s effects are highly bimodal. Most of Colombia’s 1100+ municipalities lack a landed elite. Here, rural properties grew larger, land inequality and dispersion fell, and development indicators improved. But in municipalities where such an elite does exist and landholding is highly concentrated, such positive effects are counteracted, resulting in smaller rural properties, greater dispersion, and lower levels of development. We show that all of these effects – positive and negative – flow through local policy, which elites distort to benefit themselves. Our evidence implies that land reform’s second-order effects, on the distribution of local power, are more important than its first-order effects on the distribution of land.

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Research section: 
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