Tag Archives: land redistribution

The role of elites in development (Danish Edition)

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Kenya’s founding president, Jomo Kenyatta, often reminded Kenyan elites of their roles as living examples of material “development” to the peasantry. Contra Oginga Odinga — who wanted to empower the masses through land redistribution, Kenyatta believed that an elite-driven developmental agenda was the quickest way to end the scourges of poverty, illiteracy, and disease in Kenya (yes, he had very selfish reasons for holding this belief. But that is beside the point).

Turns out he was onto something.

This is from a paper by Jensen et al. on the dairy industry in Denmark:

We explore the role of elites for development and in particular for the spread of cooperative creameries in Denmark in the 1880s, which was a major factor behind that country’s rapid economic catch-up. We demonstrate empirically that the location of early proto-modern dairies, so-called hollænderier, introduced onto traditional landed estates as part of the Holstein System of agriculture by landowning elites from the Duchies of Schleswig and Holstein in the eighteenth century, can explain the location of cooperative creameries in 1890, more than a century later, after controlling for other relevant determinants. We interpret this as evidence that areas close to estates which adopted the Holstein System witnessed a gradual spread of modern ideas from the estates to the peasantry. Moreover, we identify a causal relationship by utilizing the nature of the spread of the Holstein System around Denmark, and the distance to the first estate to introduce it, Sofiendal. These results are supported by evidence from a wealth of contemporary sources and are robust to a variety of alternative specifications.

We thus demonstrate econometrically that the pattern of adoption of cooperative creameries in Denmark followed the introduction of proto-modern dairies by agricultural elites on estate farms. In the Duchies of Schleswig and Holstein, ruled by the King of Denmark in personal union until 1864 when they were lost to Prussia, an intensified crop rotation system with an important dairy component was developed on the large manorial estates known as Koppelwirtschaft in German, or kobbelbrug in Danish. It became the dominant field system in the Duchies in the 1700s, and included unprecedentedly large herds of milch cows and the invention of an innovative new centralized system of butter production, the hollænderi, with unparalleled standards of hygiene and equipment (Porskrog Rasmussen 2010a). These innovations – collectively known as the above mentioned ‘Holstein System’ when the crop-rotation was combined with the dairy unit – came relatively late to Denmark, but when they did they gradually transformed Danish agriculture.

Denmark’s current status as an ‘agricultural superpower’ , dominated by massive firms such as Arla (a dairy cooperative) and Danish Crown (a food, especially meat, processing firm previously also a cooperative until 2010), is usually traced back to the aforementioned developments in the 1880s. As we will discuss in more detail below, at this point a new technology, the steam-powered automatic cream separator made it possible to use milk which had been transported over long distances to be processed in a central production facility, and the voluntary associations of Danish peasants, the cooperatives, sprang up to take advantage of this possibility. Thus, modern Denmark emerged based on a democratic, cooperative countryside, providing something of a role model to other agricultural countries around the world.

The whole paper is worth reading, as it provides a rather interesting rebuttal (if I may call it that) to the core ideas about the long-run effects of inequalities in initial endowments in Engerman and Sokoloff (on Latin America) as well as Banerjee and Iyer (on India):

By contrast, we stress that agricultural elites may spread knowledge, which then subsequently aids development in the agricultural sector. In other words, our work suggests that agricultural elites may also be knowledge elites, who facilitate later development. Recent work by Squicciarini and Voigtländer (2016) demonstrates that knowledge elites played a significant role in the industrialization of France by e.g. running businesses themselves or exchanging knowledge with entrepreneurs. Our work emphasizes the importance of knowledge spill-overs and agricultural enlightenment (Mokyr 2009, ch. 9), and shares some similarities with Hornung’s (2014) work on high-skilled immigration of Huguenots into Prussia. He shows that this led to higher productivity in the textile sector and interprets this as evidence of an effect of diffusion of technology. We focus on agricultural elites and their impact on the part of the agricultural sector that led to an economy-wide take-off.

The key difference in Denmark, of course, was that the social conditions permitted easy diffusion of ideas and practices from the knowledge elites to the masses, despite the inequalities in initial endowments. The situation might be different, for ex when race, ethnicity, or caste gets in the way.

Why is Mugabe Still in Power?

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Zoe Samudzi provides some excellent answers to the question of why President Robert Mugabe has had such staying power despite the many political and economic upheavals that have beset Zimbawe since the late 1990s.

Here is an excerpt:

Throughout the course of his thirty-six years in office, President Robert Mugabe has used coercion and violence to clear the Zimbabwean political arena of opposition and dissent and consolidate his political power. He has singularly blamed the deteriorating economy on western sanctions rather than responsibly attributing it also to his own inadequate planning, mismanagement of both capital and resources, his allowance of economic liberalisation and structural adjustment, and political corruption. Yet, contrary to the singularly critical narratives that tend to dominate, he enjoys some earnest support beyond what western reports about stolen elections indicate.

Also:

Most critically, the land issue – an issue of indigenous sovereignty, and perhaps the most unifying politic of Black resistance to colonial rule – went unaddressed. President Mugabe’s refusal to resign or allow regime change is justified, in part, by an idea that the revolution was stalled, and there must be consistent leadership in its continuity. It is no mistake that the ongoing process of land repossession and reform is characterised as the Third Chimurenga, and it is no accident that such vehement western critique has been levelled at state policy (genuine or otherwise) seeking to regain land sovereignty.

Remember that around independence in 1980 some 6,000 European immigrants, nearly all of whom defended the apartheid-lite (Southern) Rhodesian regime, owned 42% of Zimbabwe. Given the importance of land in an agrarian economy such as Zimbabwe’s, this was always going to be a politically untenable situation — regardless of the race of the landowners. Zimbabwe was on a path to significant land redistribution, one way or another.

So why didn’t Zimbabwe deal with the land question before independence in 1980?

Screen Shot 2017-02-10 at 7.45.33 AM.pngThe answer has to do with the the relative political power of the European settler community, especially after UDI. Since 1923 the group had enjoyed effective self-government with significant autonomy from London. And it is precisely because of their political power that Zimbabwe never had a “Swynnerton Plan” akin to what happened in Kenya in response to the Mau Mau anti-colonial insurgency.

Zimbabwe’s landowners failed to appreciate the need to make deals when they had the (political) upper hand. And by so doing set themselves up for very costly reforms/expropriations thirty years hence.

Why they made this choice is an interesting and open question.

Perhaps they trusted that Zimbabwe would continue to rely on Western aid in a manner that would have incentivized property rights protection by the government (under the threat of aid cuts and sanctions). They may have also thought that the government would not be crazy enough to jeopardize its commercial farming sector and risk total economic collapse. Another reason might have been the comfort of knowing that any land reform efforts in Zimbabwe would elicit reaction from South Africa (then under apartheid) in defense of property rights.

Apartheid, of course, ended in 1994. And the first two considerations did not stop President Robert Mugabe, at great cost to Zimbabweans of all stripes.

Given the complicated history of Zimbabwe and the wider anti-colonial struggle in eastern and southern Africa, I expect Mugabe’s legacy to be sanitized as soon as he passes on, especially outside of Zimbabwe.

 

 

More on the politics of land redistribution in South Africa (Guest Post)

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Ongoing student protests in South Africa over university fees are a reminder of the political risks facing South Africa in light of its levels of income inequality and general economic hardship. Last month I wrote on inequality and its likely political consequences in South Africa.

Friend of the blog and Harvard-trained historian Matthew Kustenbauder read the post and wrote this thoughtful response. I am posting it with his permission.

I agree with you, Ken, that the implementation of Mugabe’s land reform in Zimbabwe was a disaster.  I also agree that South Africa must reorganise its political economy or risk stability and the dividends that come with it.  It is the latter observation – that stability brings dividends – that gives me pause, however, when you suggest that the same situation of land inequality holds true in South Africa.  Despite recent comments by rockstar economist Thomas Piketty at this year’s Mandela Lecture, land and land redistribution is not the central issue upon which South Africa’s economic future hinges.  In the South African political context (about which Piketty knows little), the land question is a stalking horse.

First of all, farmers in South Africa ­ just like those in Zimbabwe today
get little support from their current governments (unlike the old
Rhodesian and Afrikaner governments, or the governments of the EU, which highly subsidise farmers) and are generally not members of the country’s super-wealthy elite.

Second, the only thing standing in the way of constitutional (emphasis
needed here, because the limits of land rights and conditions under which land reform is to take place in ZA is enshrined in the constitution) land reform progress in South Africa is the ANC.  The ruling party has refused to complete a land audit for years, while simultaneously entrenching the power of traditional authorities who hold sway over great swaths of land.

The largest landholder in KwaZulu-Natal, for instance, is the Zulu King, Goodwill Zwelithini.  As far as land rights and restitution go, the single greatest thing the ANC could do would be to grant legal title deeds to all those people living on “tribal lands” so that they can break free from feudalism and the shadow economy.  For instance, some of the students presently protesting the high cost of university fees that put tertiary education out of their reach could, if their parents had collateral such as a land title, obtain a loan that would allow them to get an education and skills they need to get a better paying job.

Third, when all of this business about percentages of land owned by whites in South Africa at the end of 1994 and today is quoted, it deceptively excludes vast tracts of land owned by tribal chiefs and kings because this is technically considered government land.  Again, there is a fundamental problem that the ANC has never addressed – land ownership and type has not been audited, even to this day.  The political opposition has repeatedly asked for a land audit to be completed, and they are ignored.

Why? 

As Jonny Steinberg recently observed: “The current government is twisting communal tenure into new forms, creating large blocs of ethnic power, giving rural aristocrats scandalous control over the distribution of land. This is a barely modified version of what Mahmood Mamdani described, a degradation of the citizenship of rural people.

Which brings me to the stalking horse bit.  Land reform is a useful
political tool, because, in addition to locking up rural votes for the ANC
just when its urban vote share is haemorrhaging,  it also serves to mask
the ANC¹s failure to address the country¹s real economic problems by
pleading to historical grievance and identity politics.  First, it is a
stick with which the black intelligentsia and political ruling class can
beat Œprivileged whites¹.  Second, it is an issue that stirs up strong
feelings among black voters and distracts from the real question people
should be asking in a democratic capitalist economy: Why hasn¹t the ANC produced more jobs and cleaned up crime and corruption?  Third, it takes the spotlight off the mining companies and other monopoly industry in ZA that enjoy far too much protection from government already, employ more workers for better pay than the agriculture sector, and contribute a far greater percentage of national domestic product than agriculture does.

A final point, one informed by an academic who, unlike Picketty, is doing real research in South Africa.  A colleague of mine is writing her
dissertation on land issues, labor disputes, etc. on farms in KZN, which
has one of the highest rates of farm murders among the provinces.  After extensive interviews and field research, she has found that, almost
without fail, when black farmworkers are offered either land or cash as
compensation for land claims filings, they take the cash ­ they simply
don’t want to farm.  So this land obsession is really more of a
psychological and opportunistic symbolic issue for the ruling bourgeoisie than a real concern of the working poor.  What people really need are decent-paying jobs, and flushing land rights down the toilet in the name of settling historical grievances or scoring political points against the opposition during election season will only leave South Africans poorer and hungrier in the end.

Incidentally, following Piketty’s call for land redistribution in South Africa Michael Albertus wrote a piece in the WaPo on why the ANC is unlikely to redistribute land.