Land reform, regional planning and socioeconomic development in Brazil

Doctoral Thesis / Dissertation, 2010
210 Pages

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The terms of the debate
1.1 Introduction, objectives and justification
1.2 Land reform for socioeconomic development: brief international overview
1.3 Research focus: the case of Brazil
1.4 General methodology

Regional planning in the land reform literature: a gap to be bridged
2.1 Introduction
2.2 Historical background: tracking back the roots of land reform schemes
2.3 Seeking the socioeconomic determinants of land allocation
2.4 The legal framework and scope for government intervention
2.5 Land reform for socioeconomic development: a gap
2.6 Regional planning in land reform: a bridge
2.7 The literature at a glance

The socioeconomic impacts of land reform: an empirical exercise for the Brazilian Northeast
3.1 Introduction
3.2 The socioeconomic gap in the Brazilian Northeast
3.3 The twofold sequence of the government response: state-led and market-based
3.4 Capturing the socioeconomic impacts at the sub-regional level
3.5 Fine focusing the lens: land reform in the rural localities
3.6 Conclusions

The Land Bill Programme: a baseline study of PCT settings
4.1 Introduction
4.2 Access to land under the Land Bill Programme
4.3 Agriculture and livestock production on PCT settlements
4.4 The standard of living of PCT beneficiaries
4.5 The surveyed sites vis-à-vis the regional economy
4.6 Conclusions

Planning land reform at the level of the region
5.1 Introduction: scope and purposes
5.2 Linking national strategies and local action: top-down & bottom up
5.3 Targeting the land: a portfolio of strategic areas
5.4 Seeking optimal policy options: a portfolio of investment priorities
5.5 Stakeholder engagement: policy-making as a win-win game
5.6 Overcoming the budget constraint: a state-market enterprise
5.7 Monitoring the results: the socioeconomic sustainability of the reform
5.8 Conclusions





I hereby declare that this dissertation is the result of my own work* and contains nothing that is the outcome of work done in collaboration except as declared in the preface and specified in the text. Furthermore, this dissertation is not substantially the same as any that I have submitted or will be submitting for a degree, diploma, or other qualification at this or any other University. The word and figure limit prescribed by the Land Economy Degree Committee has not been exceeded.

Saulo Santos de Souza

May 25, 2010


In this dissertation, we examine the socioeconomic impact of land reform schemes and discuss the policy implications of combining aspects of both state-led and market-based approaches to land reallocation through regional planning. We focus on land reform settlements in Northeast Brazil, where both approaches operated over the same time frame (1997-2002). Empirically, we identify the effects of various indicators on the socioeconomic growth of a sample of rural territories and localities, giving emphasis to the influence of the market-based Land Bill Programme (PCT) and the traditional state-led scheme (INCRA) on that growth through panel data analysis, cross-section regressions and field-based analysis.

It has been concluded that: i) The scope for plan-led strategies towards sustainable development in the countryside has been given less than sufficient emphasis in the land reform literature; ii) There is not clear evidence that the market-based approach leads to higher socioeconomic growth regionally than does the state-led approach, or vice-versa; iii) Although the market-based scheme contributed to improved access to title, the PCT settlements failed to impact positively settlers’ welfare in the majority of sites; iv) Securing both higher access to land rights and better living conditions through land reform requires an approach that combines both state-led and market-based elements; iv) Securing measurable positive impacts on the regional economy requires a land reform strategy that has a regional scope. As a policy implication, the work suggests the adoption of a plan-led land reform strategy that is coordinated at all government levels and between the public and private sectors, and one that involves establishing strategic portfolios of sustainable areas, defining spending priorities and funding possibilities through regional planning.

Differently from the commonsense literature on land reform in developing countries, this work demonstrates that regional planning has an essential part to play in land reform through proposing a plan-led strategy that combines elements of both market-based and state-led approaches to the benefit of the regional economy.

Keywords: Land reform, socioeconomic development, regional planning, developing countries, Brazil.


First and foremost, I would like to gratefully acknowledge the enthusiastic supervision of Dr. Elisabete Silva. She provided me with guidance, constructive advice, and constant encouragement toward the completion of this thesis. Her friendship, trust and understanding were my best sources of progress. She deserves my utmost gratitude.

I also wish to express my appreciation to Dr. Marcus Melo of Federal University of Pernambuco, Brazil, who first incited me to apply for and pursue a PhD degree at the University of Cambridge.

I am especially grateful to Professor Lynetta Campbell of Lone Star College, Texas, for providing indispensable statistical advice for my work. I also owe thanks to Celio Almeida, Daniel Guedes, and Ieda Rezende for their valuable assistance with my field work. I acknowledge financial assistance by Programme AlBan and the Cambridge Overseas Trust, for sponsoring my PhD study.

I am grateful to all my friends from Darwin College, for their companionship during the time I stayed there, and also to the staff, faculty and friends of the Department of Land Economy. Special thanks are due to my Brazilian colleagues in Cambridge, particularly Carol Baltar, Ana Cristina and Jose Vitor, for helping me to handle my day-to-day affairs.

I am forever indebted to my parents Paulo (in memoriam) and Hilda. I cannot forget their love, efforts, and prayers. I also wish to express thanks to my brother Daniel and my sister Yeda for their words of encouragement.

I would like to express gratitude to my dear wife Gardenia. Without her love, moral support, understanding, endless patience and encouragement when it was most required, this study would not have been completed. She deserves my keen appreciation for taking good care of our beloved children, Vinicius and Erick, whilst I was away. I knew they were missing me too much, and so was I. They have been my pillar, my joy and my inspiration.

Above all, I give thanks to the Lord our God for the daily strength that I need to overcome the difficulties in life. Soli Deo Gloria.


Table 1.1: Land negotiation and government intervention in selected countries

Table 1.2: Summary of the methods used in the empirical chapters

Table 2.1: Highlights of the literature: land policy and planning

Table 3.1: Key indicators average growth rates (1995-2005) – Northeast states

Table 3.2: Panel data analyses variables

Table 3.3: Determinants of farming GDP growth – rural territories

Table 3.4: Cross-section analyses variables

Table 3.5: Social and economic determinants of growth – rural localities

Table 4.1: Sample of PCT settlements

Table 4.2: Settlers’ own assessment of purchased plots

Table 4.3: Settlers’ basic profile

Table 4.4: Composition of PCT settlers’ farming activities

Table 4.5: Quality of main roads in the sampled areas

Table 4.6: Characteristics of settlement production in the sample

Table 4.7: Settlers’ income and economic situation

Table 4.8: On-site infrastructure in selected PCT settlements

Table 5.1: Requirements for multi-tier coordination mechanism in the Northeast

Table 5.2: Requirement for a portfolio of priority target areas

Table 5.3: Requirement for a portfolio of investment and spending priorities

Table 5.4: Requirement for stakeholder engagement in land reform

Table 5.5: Potential sources of funding, public and private

Table 5.6: Requirement for monitoring the land reform intervention

Table 5.7: Overview of the land reform strategy and monitoring process

Table 5.8: Scope of plan-led land reform strategy


Figure 3.1: Brazilian regions

Figure 3.2: Selected rural territories

Figure 3.3: PCT projects in selected rural territories

Figure 4.1: Agro-climatic zones and approximate location of sampled settlements

Figure 4.2: Housing types

Figure 4.3: Source of indoor illumination

Figure 4.4: Home appliances

Figure 4.5: Hectares of selected crops in sample of PCT municipalities

Figure 4.6: Hectares of selected crops in the Northeast

Figure 4.7: Land ownership and access to public services

Figure 4.8: Employment, income and human development

Figure 4.9: Selected economic indicators in the sample – Growth rates

Figure 5.1: PCT governance structure

Figure 5.2: Illustrative structure of governance for plan-led land reform

Figure 5.3: An illustrative diagram for the regional planning cycle


Abbildung in dieser leseprobe nicht enthalten


The terms of the debate

1.1 Introduction, objectives and justification

Are the so-called market-based and state-led approaches to land reform mutually exclusive approaches? What policy mechanisms could be applied to reconcile both approaches towards promoting sustained development at a regional scale? These two questions form a basis for our investigation towards understanding the reality of land reform in Brazil as well as the challenges involving applying regional planning to land reform policy in a broader regional context. The thesis is intended to put forward a discussion that goes beyond the comparison of the effects of two different approaches to land reform, as emphasis is put on key issues highlighted in the regional planning literature as particularly relevant for the contribution of land reform policy to regional, socioeconomic growth. As such, it is an attempt to intervene in mainstream debate on land reform in developing countries.

Historically, state-controlled land reform schemes, which have generally been carried out through expropriation or compulsory acquisition of privately owned land, have been viewed as instrumental for land redistribution and poverty alleviation purposes in developing countries (Navarro, 1998; Borras; 2003). However, these traditional mechanisms are based on rules and regulations that, some believe, could constrain the free operation of land markets (Deininger et al, 2003; Neto, 2004) and encourage unlawful occupations of lands (Alston et al, 2000; Caldeira, 2008). Alternatively, a less-interventionist, market-based approach has been adopted by an increasing number of developing countries (e.g., Brazil, Colombia, South Africa and the Philippines) based on the provision of land funds or loans to landless or near landless poor in order to stimulate land transactions directly between loan beneficiaries and property-owners. Yet the approach’s effectiveness for obtaining sustainable socioeconomic development has been disputed in the literature (Deininger, 1999; Fajardo, 2002; Justiniano, 2002, Deininger et al, 2004; Borras, 2005; Pereira, 2007), and it remains to be answered whether the market-oriented approach has been a more efficient tool than the traditional schemes to impact the regional economy positively and lastingly.

In Brazil, the rural sector has undergone momentous transformations over the last decades as positive trends towards sustainability of agricultural and livestock production have been ascribed to technological modernisation and agribusiness expansion (NEAD, 2000). Notwithstanding, the highly unequal pattern of land ownership has not been pushed toward greater equality, and rural poverty is still a striking problem. A 2003 National Household Sample Survey (PNAD) reported that about 12 million rural households (44.8% of rural population) were in low-income poverty, of whom about half lived in the Northeast region of the country. Several studies have also highlighted that Brazil is characterised by a high level of landlessness, with a land distribution amongst the most unequal in the whole world (Domingos, 2002; Fernandes, 2004; Pereira, 2007). This combination of high deprivation and landlessness has led to social tensions involving displaced rural landless and major landowners throughout the Brazilian countryside (Alston et al, 2000; Hoefle, 2006; Caldeira, 2008), and the numbers who are potential beneficiaries of land reform have been estimated at 2.5 million (Deininger, 2003).

The literature is ripe with various, and sometimes seemingly contradictory, descriptions of the problems hindering land reform programmes in the country and the sustainable socioeconomic development of sites. To name but a few: political and bureaucratic inertia (Alston et al, 2000), influence of neoliberal concepts (Domingos, 2002) manipulation by local elites (Borras, 2003), or simply neglect of the problem by successive governments (Caldeira, 2008). At the same time, land redistribution initiatives and regional planning seem to be poorly interrelated in Brazil, and this has placed land reform policy at odds with broader rural development strategies. As Heredia et al (2006) elaborates, mainstream land reform programmes put in place to foster poverty alleviation in the Brazilian regions have been implemented at random and disjointed. Broader land reallocation initiatives (e.g. the 1985 National Plan of Agrarian Reform) have been carried out through unplanned, unsystematic “expropriation packages” established in areas chiefly following massive land occupations by peasant groups. As a result, little change in the landholding structure could be noticed except perhaps in some rural localities. Buainain et al (2000) calls attention to the insulated and incomplete character of land reallocation in the country, stressing that, instead of being part of an overall rural development strategy, land reform has been mostly a “crisis intervention” policy. Similarly, Sabourin (2008) notes that the Brazilian government has failed to implement major plans of land reform. The author asserts that this has led to land redistributed mostly in precarious conditions of settlement and support to production.

These brief statements from the literature seem to demonstrate that absence of institutional mechanisms coordinating the reallocation of landless populations has been detrimental to land reform efforts in the Brazilian countryside. A lack of such mechanisms has frustrated the federal government’s intent of getting the support of states and municipalities, and also of grass-roots peasant movements, over the issue. This also indicates the increasing need of a plan-led approach to land reform policy-making and implementation in the context of regional development. However, how to efficiently redistribute land and improve the family-farm system in order to increment the regional economy is a challenge. One wonders if can regional planning satisfactorily minimise coordination gaps in land reform initiatives or will it replicate the outcomes of past state-led or market-based programmes?

We seek answers to this question through a study of the impacts of land reform schemes in the Northeast region of Brazil. Empirically, we assess whether the schemes have been able to guarantee the steady improvement of the situation of families living in land reform sites. Moreover, a need is perceived for designing appropriate strategies taking into account region-specific factors and the proper balance between state intervention and market forces. A detailed examination of determinants of socioeconomic growth in the areas hosting land reform settlements is hence necessary to yield generalisations for hypothesis testing, and some research objectives needed be pursued. This thesis is hence guided with the following hypothesis:

Hypothesis: Regional planning can significantly improve the results of land reform policy at a regional scale.

Based on the foregoing hypothesis, four main research objectives underpin this work:

1) Examining the regional impact of state-led and market-based approaches to land reform in the Brazilian Northeast;
2) Examining the extent to which a lack of intergovernmental/intersectoral coordination has affected the socioeconomic performance on land reform sites;
3) Exploring forms of combining both approaches (i.e. a state-market approach) into a more comprehensive land reform strategy;
4) Developing propositions for a top-down/bottom-up structure of governance for land reform policy-making and implementation.

We build on the presupposition that whilst land markets are useful for the purpose of providing the landless with property rights, the state can step in to offer a clearer indication on how to prompt sustained socioeconomic development in areas beyond the reformed sites. In other words, whilst land markets may serve as the engine of land allocation, the government can act as a strategist, establishing the proper incentive framework necessary to support sustainable development not only in areas primarily benefiting from the schemes but also in the regional economy. Consequently, neither a top-down intervention nor the demand-and-supply mechanism should be regarded per se as a sufficient pro-growth tool. Instead, it is our contention that a combination of ex ante government intervention and market-oriented instruments in reallocation of lands is needed to provide a favourable structure of incentives to all involved parties.

Hence the main assumption of our work is that market-driven and state-led approaches to land reform can be mutually reinforcing mechanisms to attain: i) beneficiaries’ access to productive land; ii) higher standards of living for settled families; and iii) sustained development that may arise for the benefit of areas beyond the negotiated plots. Taking a step forward, our study evaluates the extent to which plan-led concerted actions can facilitate the achievement of these three prime objectives of land reform. As the main policy implication, we suggest that paving the way for a broader socioeconomic development in the medium to long term will, in the main, depend on a strategy of regional magnitude to attract higher quality, better located land to the schemes. Accordingly, whilst throwing more light on the role of regional planning in land reform, this study represents a shift from the traditional market-based versus state-led debate in the land reform literature and into a more plan-led view on the matter.

To summarise, this thesis intends to address how regional planning might best tackle the problem of slow socioeconomic growth in deprived rural areas, specifically in the context of land reform. By underlying the need for long-term thinking towards combining varied land reallocation mechanisms, it contributes to understanding the interconnections between state intervention and market forces in poverty alleviation schemes. Towards contributing to this evolving knowledge on mixed pro-growth strategies, new governance structures are explored. Influencing elements, constraints and possibilities, including those of public-private collaborations are examined. Other policy instruments explored include land targeting, ex ante appraisal of sites, design of intervention, intersectoral coordination and ex post sustainability assessment and stakeholder input gathering methods. A plan-led land reform strategy in this context refers to mechanisms through which different actors interested in or affected by the reform are involved in planning, implementation, and monitoring of programme and projects that could influence socioeconomic growth regionally. All these themes are connected with the regional planning literature and are consequently expected to influence the regional distribution of land reform settings in a more efficient manner.

This thesis is organised as follows. In the remaining of Chapter 1 we review empirical evidence involving state-led and market-based land reform in the developing world as a basis for our subsequent analysis of the land reform experience in the Northeast of Brazil, as well as details the methodology used thereafter. A broader survey of the literature is performed in Chapter 2, which addresses historical, socioeconomic, legal and institutional elements associated with land reform, in order to establish the theoretical framework of our analysis. In Chapter 3, we empirically examine the impact of INCRA and PCT schemes on the economy of the region. Cross-section analysis and panel data analysis are performed using variables selected according to the rural development literature. Chapter 4 describes our case study in the Brazilian Northeast and analyses whether the market-based scheme has been able to trigger sustained socioeconomic development in a sample of PCT settlements. Chapter 5 takes into account the regional planning literature and the empirical results presented in Chapters 3 and 4 to discuss the policy implications of combining aspects of different approaches to land reform into a broader regional land reform strategy. The last part of the thesis brings a summary of our main conclusions and gives final remarks.

1.2 Land reform for socioeconomic development: brief international overview

In the modern world, a number of developed countries of Europe and North America have long expressed concern with guaranteeing land rights and sustained development for rural communities. Although land reform processes in these countries have taken place in the aftermath of the Industrial Revolution in late 1800’s and early 1900’s, land related issues have not been completely suppressed from the policy agenda in more industrialised economies. In the United Kingdom, for example, despite a tradition of open access to rural land, land related legislation has been passed to avoid potential damage or negative interference with farming activities, specifying the rights and responsibilities of land managers and countryside users in general. Particularly in Scotland, a unique approach to rural land has been followed, since the Scottish Executive proposed a stewardship model in 2001 to provide legally constituted community groups with public funding to help them meet the purchase price of land available in formal land markets, as a step to terminate the Scotland’s historic legacy of feudal-like law and reduce one of the highest concentration of land ownership in the western developed world (Bryden and Hart, 2000). However, most equity objectives have been jeopardised and sustainable rural development modestly enhanced by absence of incentives to negotiation of large single properties and bringing down unrealistic land prices.

In contrast, the Netherlands have been quite successful in their rural development efforts after multi-sectoral policies were put in place entailing the 1984 Land Use Act, which strongly encourages state and provincial land use and development planning strategies (Van Lier, 1998; Aarts et al, 2007). As much as this legislation has led to improved access to land with a totally free land market, yet about 30 percent of farmers and rural smallholders in the Netherlands remain working on a tenancy basis. Land rents are regulated in a Tenancy Standards Decree setting out ceilings for rent values in every region. Moreover, part of the tenanted agricultural land in the country is owned by the government, which also contributes with funding for ecological schemes and public objectives. Not only in the Netherlands but also to a significant extent in many developed economies, land policy focus on land rental markets that allow for long-term contracts, largely because renting land is less expensive than purchasing property.

Land reform has also occurred in the developing world as an important step in achieving economic development since the post-World War II period. According to De Soto (2000), programmes to provide the poor with land have been in place in almost all developing and former communist countries because “most developing nations today recognise the principle of universal access to property rights as a political necessity as well as an implicit ingredient of their macroeconomic and market reform programmes”. Moreover, recognition of the fact that enhanced socioeconomic outcomes are associated with higher land de-concentration has prompted many national governments to launch land reform schemes to stimulate the countryside economy and put growth at a sustained pace.

Yet approaches vary in terms of the degree to which governments intervene. Although in some countries of Eastern Europe collective structures of production barely contributed to rural socioeconomic development, mainland China stands as a good example of a transitional economy that succeeded as far as overall economic growth is concerned, without allowing private sales of rural land in their processes of land reform (Ho and Spoor, 2006). An intermediary approach was adopted by Ukraine when the country’s common land tenure structure was changed into a lease system to give peasants the right to work small parcels of land. Poverty decreased as the system provided rural workers with a stable income for the term of the lease (Valletta, 2002). At the opposite end of the spectrum, Belarus was one of the former Soviet nations openly committed to privatise rural land in the 1990s. The country saw deep declines in agricultural output and farm labour productivity leading to a scanty GDP growth performance after an intense privatisation process of rural areas (Swinnen, 2003). Thus, by looking at the transition experience, the question might be raised whether state-free negotiation of land is a prerequisite for sustainable rural economic development, all other factors equal.

In non-transitional economies as well, purchase and sale of properties do not tell much about the success of land reform driven by market rules. This has been a matter of concern in parts of Africa and Asia, where extremely unequal land ownerships have obstructed the setting up of more inclusive models of growth. Despite high cross-country variation in land market policies, most African countries have failed to formalise land transactions. For instance, formal land markets in the 1980s in Kenya could not meet the landless’ massive demand for land, causing the development of informal settlements and noncompliance with the legislation concerning the registration of properties (Musyoka, 2006). Additionally, land restitution and redistribution programmes in Africa were not followed by significant support services from governmental agencies and a decrease in poverty was limited to resettlements where good quality land was obtained, securing substantial crop revenues for the beneficiaries (Hoogeveen and Kinsey, 2001). Analysts believe, therefore, that more infrastructure investments by the state would have facilitated the setting-up process of those family farms while expediting the combat of poverty.

Another interesting case from Africa involves the 1995 Rural Development Programme (RDP), put in place in South Africa to mitigate extreme poverty and land concentration resulting from the apartheid regime. The RDP market-led approach was, for the most part, influenced by the World Bank’s interests in fostering growth through private investments in rural economies of the developing world. The basic strategy was to offer loans at subsidised interest rates for the landless to buy land on the market. Brink et al (2005) examined changes in basic socioeconomic indicators in the areas reached by the RDP to find a very slow increase in the household expenditure level, but also an increase in severe poverty and inequality indexes. Further, the land-buyers in the countryside did not count on an integrated network of support services, due to coordination inefficiencies between governmental agencies. As a by-product, the rural areas benefited less than urban areas from the RDP land tenure system.

In Asia, most countries have imposed legal restrictions to land rentals whilst formal land markets have developed only recently. In the Philippines, however, the very first prototype of land reform of a free-market nature was implemented in 1988 under the Comprehensive Agrarian Reform Programme (CARP). The programme took the form of voluntary land transfer schemes through lease contracts. To become eligible for the lease and gain access to land, rural families were asked to present farm plans before engaging in land transactions with landlords. Conceptually, the whole scheme should result in sustained farm and beneficiary development. Whuilst it might be true that the programme achieved reasonable land redistribution, agricultural development in CARP areas has been slow and rural poverty still abound because the most economically productive land remains in the hands of powerful landowners (Borras, 2003). The gradual suppression of restrictions to free land transactions has been seen in other Asian countries like China and Vietnam but empirical evidence on their socioeconomic impacts is still scant, and land reform in these countries has, in the main, relied on administrative allocation.

Similarly, state-led redistributions of land abound in Latin America yet public investments have been concentrated in large-scale farms, at the expense of smaller family-based units. Another common feature among Latin American countries is that a need to fight poverty in both urban and rural settings has affected policy formulation in multiple fronts, whereas administrative capacity has been limited and budget constraints have made resources for land reform usually scarce. Accordingly, free land market projects have increasingly been designed with a view to replace direct government intervention through land expropriation. However, unintended consequences have derived from insufficient public investments as a complement to market-led land distribution schemes. For example, the rural housing deficit has increased in most of Latin America and low-income families have endured inadequate sanitary conditions.

An analysis of a 1998 World Bank-funded land regularisation project in Guatemala gives an example of how the expected benefits of land market allocations have been severely constrained by socioeconomic factors alongside a lack of robust government strategies (Gould, 2006). More specifically, land-attached investments in the agricultural frontier region of Petén were not sufficient to overcome the absence of strong markets in the region that could absorb most of the crops produced in the settlements. Consequently, land titles failed to generate enhanced material well being for Petén’s peasantry. Also, land titling projects based on negotiation of land were introduced in the Caribbean island nation of St. Lucia in the mid-1980s. A recent study demonstrates that the island’s formal land market alone was not able to replace its informal system of unregistered inheritances (Barnes and Griffith-Charles, 2007). Factors other than tenure security did impact the prospect of land transactions far the most, in that case the government’s decision to remove subsidies from the sugar industry. Not less importantly, the analysis indicates that location is a significant factor influencing the survival of formal land markets, since property formalisation projects motivated by market objectives in St. Lucia have proven more effective on urban or periurban settings where more public funding was available rather than in rural areas.

Colombia has also made an option for land reform giving attention to subsidised transactions of land, as regulated by Law 160 of 1994. In accordance with the standards of the World Bank’s model, the government was responsible solely to provide loans and a range of basic post-land purchase support services. Yet the marginal status of acquired properties required way more resources than anticipated and high interest rates led to defaults in loan paybacks. The situation was aggravated by discontinuity of state administrations pursuing extremely varied investment priorities. However, contrasting views can be found about the success of the scheme in Colombia. For instance, whereas Deininger et al (2004) understand that the land market is more effective in transferring land to the under-privileged than is administrative land reform, Fajardo (2002) and Borras (2005) agree that the pace of rural development has been slow and uncertain as substantial increments in agricultural output and rural employment are still to be seen.

By the same token, Bolivia launched the National Agrarian Reform Service Act in 1996, establishing public auctions for surplus land. Access to land was made preferential for indigenous groups and landless peasants. The Act counted on a taxation system over land use to provide local governments with funds to support production in the settlements. The government failed to fully enforce the tax legislation, however, and the pattern of access to land was not significantly altered. Furthermore, the granting of loans for unsupervised land clearing contributed to spread deforestation to areas unsuitable for agriculture (Justiniano, 2002). The availability of World Bank’s funds also led Ecuador (under the PROTIERRAS programme) and Peru (during the economic liberalisation process known as “Fujishock”) to design land redistribution according to market forces, but socioeconomic results in both countries have not been disparate from prevalent ones in their Latin American counterparts. In Costa Rica, the Agrarian Development Institute purchased and redistributed land for the creation of small-sized rural settlements in addition to offering a range of infrastructure services to help family farms succeed in the agricultural market. The amount of public investments was not, however, homogeneously allocated, and rural income inequality remained a matter of concern in the country.

Mixed results with respect to rural equity can be found in diverse South Asian countries, as World Bank reports have pointed out, and the scope of government intervention has varied considerably. Finally, a series of publications and research inquiries released by the Brazilian Centre for Agrarian and Development Studies, the Inter-American Development Bank, the Food and Agriculture Organisation of the United Nations, amongst others, have reported cases of land funds put in place in developing countries to assist multiply deprived people in acquiring land. Table 1.1 summarizes the approach to land reform and its impacts in a selected group of countries.1

Table {SEQ Table \* ARABIC} 1: Land negotiation and state intervention in selected countries

Abbildung in dieser Leseprobe nicht enthalten

To sum up so far: the pendulum swings and will probably continue to swing between more and less state intervention, even in countries that have adopted models relying on land market mechanisms. Nonetheless, the above summary of the recent trend in adopting market-based schemes as well as former state-controlled approaches presents a bleak picture, clearly lacking in the indication of what region-specific factors should be taken into account in determining reform outcomes. The above discussion indicates, therefore, that great care must be taken in considering which findings from studies of land reform may be applicable to which context. On the other hand, despite some positive results associated to different models of land reform in developing countries, the reviewed studies do not tell much regarding the role of regional planning as a means to improve the regional impact of the schemes. As a rule, these programmes have been detached from comprehensive strategies that involved an economically efficient distribution of settlements at a regional scale coupled with a well-planned provision of public-private resources benefiting those settlements. This has been the case in Brazil as well, where market-driven land redistribution schemes have been adopted in the Northeast region of the country in the late 1990s, in parallel with the traditional mechanisms of land reallocation under the responsibility of the state.

1.3 Research focus: the case of Brazil

Land reform programmes have constantly been part of the public policy agenda in Brazil on the basis of a need for fighting rural poverty as a sine qua non for obtaining economic growth and social inclusion simultaneously. Circa the late 1950s, the federal development-prone efforts positioned themselves in line with the premise that agrarian reform could be a crucial tool for socioeconomic growth in the countryside. Over the course of the 1960s, the National Institute for Colonisation and Agrarian Reform (INCRA) was created to become responsible for state-led land reform in the whole country, the focus being on the expropriation of large, mostly under-utilised rural properties to organise settlements as a means to secure land as a sustainable source of income for settlers and their family. Yet INCRA efforts in isolation would not be, and has not been, able to substantially reduce the country’s highly unequal landownership, nor to significantly improve rural households’ income and livelihood prospects.

During the 1970s, Brazil launched a series of specific regional development programmes as complementary to land reform policy, most notably the National Integration Programme (PIN) and the Programme for Land Redistribution and Stimuli to Agro-industry in the North and Northeast (PROTERRA). However, subsequent studies (Baer et al, 1978; Bakx, 1986; Hall, 1987) found that the programmes wound up highly expensive, served far fewer families than expected and rendered a negligible influence on the regions’ development. As prima facie evidence of a lack of substantial land reform results, disputes over landownership escalated in the 1980s due to action by rural workers’ unions, remarkably the National Confederation of Agricultural Workers (CONTAG) and the Rural Landless Workers Movement (MST). These groups “developed a strategy for identifying a farm, invading it, and, most importantly, transforming the invasion into an expropriation by INCRA” (Alston et al, 2000: 168).

In 1985, the government proposed a comprehensive National Agrarian Reform Plan (Plano Nacional de Reforma Agrária - PNRA), aiming at resettling 1.4 million landless peasant families over a 5-year period. Yet the plan was blocked by political pressure from large landowning interest groups and could not be implemented as originally intended (Hall, 1987). Later in that decade, provisions in the 1988 Federal Constitution were included that confirmed the legal possibility of expropriation by INCRA of large rural estates that are neither serving their social function nor being considered unproductive. In addition, a number of specific support programmes have been put forward over the years to promote the economic viability of land reform settlements, such as the Special Credit Programme for Agrarian Reform (PROCERA), the Emancipation Project (Projeto Emancipar), the National Programme of Education for Agrarian Reform (PRONERA), and many others. Nevertheless, socioeconomic conditions on land reform sites in Brazil remain near the lowest in the developing world. Why?

In search for the factors plaguing state-led land reform in Brazil, many studies have focused on the Northeast region, where a great number of settlements have been concentrated (42% of total in Brazil, according to the Ministry of Agrarian Development). Amongst the main findings, one could point out that “INCRA has been expropriating unfertile land” (Buainain et al, 2000: 9) coupled with the fact that “these areas do not have basic infrastructure and are rather far from dynamic markets” (Sabourin, 2008: 6). Moreover, rather than promoting sustainable growth, land expropriations “have generated corruption, tenure insecurity, and red tape” (Deininger et al, 1999: 263), besides “escalating social conflict and undermining agricultural development” (Neto, 2004: 53). Also, despite some micro-level improvements, Heredia et al (2006: 285) admit that “the implementation of the settlements has not altered the scenario of land distribution on a large scale”.

Findings from a previous study by Heredia et al (2002) on land reform settings created by INCRA support this view. The well-cited research was based on a survey conducted in the period 1985-1997 in different regions of the country, including the Northeastern states of Alagoas, Bahia, Ceara, Paraiba and Pernambuco. In fact, some progress was reported regarding income and living conditions: 62% of settlers said they had increased access to food and basic consumption goods. Should their previous status of deprivation be recognised, however, a change in life quality would be expected in any event, and the reported advancements might not tell much. Moreover, the study’s results for on-site infrastructure were particularly dismaying: water supply was problematic in 46% of sites; only 27% of sites enjoyed full electricity supply; road access used to be precarious (generally unpaved roads in terrible conditions); most sites had primary schools, yet of an inferior quality; and only 21% of settlers counted on health care facilities. These results indicate that the nature and extent of state intervention in land reform were devoid of capacity to lift reform beneficiaries out of poverty.

In contrast to this nationally-defined yet dispersed pattern of land reallocation characterising the traditional agenda of reforms in Brazil, a market-oriented policy was introduced in 1997, known as Land Bill Programme (PCT). Whilst co-existing with ongoing INCRA expropriations, the new scheme focused predominantly on the provision of land loans to stimulate the voluntary purchase of properties by eligible families with specific exclusion dificulties in five Northeastern states. A preliminary evaluation of the projects was undertaken by request of the Ministry of Agrarian Development in 2000, and some positive results were reported particularly with respect to access to title and living conditions, even though it was made clear in the report that the Programme was “still too recent to allow for an evaluation of its socioeconomic impacts on both beneficiaries and local communities” (NEAD, 2000: 83).

A number of studies immediately turned their focus to the various dimensions of the Programme. For some observers, the PCT initiative was not only market-oriented, but also import-oriented, based on the neoliberal models streaming from the Washington Consensus.2 According to this view, the Brazilian government welcomed the loan-based programme as a convenient justification for a retreat from complementary spending in expropriated plots, that being one of the reasons why the model could not work in the manner foretold by its advocates. Pereira (2007), for instance, has held the idea of employing market mechanisms to land access as a neoliberal attempt by international organisations to entirely subordinate the Brazilian peasantry labour force to powerful agribusiness companies. For others, the willing-seller-willing-buyer nature of the schemes has denied the peasants access to productive land, indicating that the reform was limited in coverage and sustainability. Based on the preliminary MDA results, it is found in Borras (2003: 380) that “the marginal character of the purchased lands, their distance from local markets, and the general absence of road access, electrical and irrigation facilities have made the task of farm production quite difficult if not impossible”. Likewise, Domingos (2002) has concluded that the dramatic situation of rural poverty in Brazil will not be overcome by market mechanisms that merely rely on a credit line to purchase land, given the high rate of beneficiaries who have subsequently abandoned the land. In general, analysts in this side of the table sharply disagreed in many respects with the initial expectations raised by proponents of the market-friendly approach, and wrote instead in favour of state-led land expropriations.

Buainain et al (2000) contest this view by arguing that transaction costs embedded in the processes of land expropriation may increase land prices in the rural sector. Other distortions are mentioned in their study: bureaucratic slowness, including in the judiciary, political interference and high compensatory costs. Finally, such kind of state intervention does not ensure that the expropriated land is suitable for agricultural purposes, basically due to deficient local infrastructure in most settlements, in addition to restricted access to dynamic markets. Deininger (1999) described early results and future challenges associated with the market-based programmes in Brazil. He argued in the first place that further government intervention might represent retrogression in the development of land markets. The author concluded that negotiated land reform could provide a solution to the problem of land inequality, conditional, however, to attracting private sector investment. One way or the other, the great majority of studies in favour or against land reform oriented to the market have outlined important issues that underpin current analysis of the conditions in settled rural areas. Their empirical findings, nevertheless, have shown scarce evidence in terms of sustainable regional development as a result of the programmes.

On the other hand, they converge to the idea that the various land de-concentration attempts by the Brazilian government have never completely eliminated the structural blockages to socioeconomic development of the most deprived countryside areas, a socially inclusive advancement that either market forces alone or isolated government intervention have had limited capacity to foment. Even the technological advancements occurring in the Brazilian countryside beginning in the 90’s were mostly limited to large agricultural businesses, far out of reach for ordinary family-based farms, as noted by Domingos (2002). Additionally, observers have pointed out that achievements so far have been meagre with respect to infrastructure improvements in rural areas benefiting from loan-based programmes. Persistent post-purchase difficulties have been reported in the literature, namely general absence of road access, electrical and irrigation facilities, as well as a lack of schools, basic sanitation and health facilities (Buainain et al, 2000). Such problems have undermined farm production and negatively affected beneficiaries’ living conditions as well as their ability to repay their loans (Borras, 2003).

In summary, the studies mentioned above suggest that a series of flaws in both approaches to land reform prevented the resettled areas from experiencing higher rates of socioeconomic growth. More precisely, there was an inability of the schemes to attract well-located, adequately serviced lands, and the families were reallocated without the efficient provision of on-site improvements and government extension services. A holistic method of land redistribution in Brazil would therefore be welcome at this stage, inasmuch as carefully planned courses of actions are more than likely to have beneficial socioeconomic implications for land reform policy-making and implementation in the rural countryside.

The Brazilian Northeast presents a unique and interesting case study in the developing world as both state-led and market-based approaches were held over the same period of time, which allows for a comparison of socioeconomic development under variegated policy frameworks whilst controlling for about the same set of region-specific and time-specific factors. A justification is thus in place for the study of regional planning in the Northeast of Brazil as a two-pronged instrument to connect both land reform approaches and simultaneously achieve land redistribution and socioeconomic upgrade at a regional scale.

1.4 General methodology

Our work starts with an international overview of experiences with land reform policy in developing countries as an initial tool for the analysis of land reform schemes in Brazil, and a basis for subsequent discussion of their impact on our case study area. A survey of mainstreams studies on land reform and regional planning is hence performed in Chapter 2 aiming to provide a theoretical framework for comparing the impact of different approaches to land reform, as well as the potential role of regional planning as a strategic governance tool in land reform policy. Our empirical analyses of Chapters 3 and 4 can be broadly defined as consisting of quantitative and qualitative modes of inquiry to measure the effects of the PCT and INCRA schemes in the economy of the Northeast in order to pave the way for a data-led discussion on the policy implications of adopting a plan-led strategy to ensure that the beneficial impacts of land reform are magnified.

The statistical data analysis of Chapter 3 is primarily aimed at verifying whether the reform has produced measurable socioeconomic impacts on rural areas in receipt of the schemes and at the sub-regional level. Our samples were made up of 49 rural territories as well as 416 rural localities within the three main agro-climatic zones in the Northeast (semi-arid, rainforest and the transitional zones), which includes areas reached by the INCRA schemes and simultaneously where the Land Bill Programme was introduced. The sampled cases (rural localities and territories) were defined for analysis as well as logistical purposes based on their location in relation to the zones as well as on data availability. The study relied on official data per locality and territory released yearly by two leading data sources: the Brazilian Institute of Geography and Statistics (IBGE) and the Institute of Applied Economics Research (IPEADATA). The explanatory variables were conceived a priori based on the surveyed literature. The same criteria were applied to the selection of the dependent variables, which were substantially the following:

a) Growth in farming output in the municipalities hosting land reform projects;
b) Growth in the regional GDP that could reflect changes in the economic activity in the territories;
c) Growth ratio of rural income in the sampled localities;
d) Growth ratio of the Human Development Index (HDI) for the same rural localities.

The study began with an exploratory data analysis using visual inspection of the data and a summary of key statistics and distribution shapes (histograms and Box-Whisker plots) generated using the SAS statistical package, to make sure that the variables, both independent and dependent, exhibit the normal or near-normal distribution, which is a key assumption in linear regressions. After missing information cut-off, we performed multivariate panel data regressions of the selected socioeconomic indicators from our sampled territories over a period of 11 years (1995-2005). The main purpose was to determine whether region-specific social and economic characteristics of the observations had an impact on the growth of the regional economy. Additionally, we introduced dummy variables in the models that differentiated situations of market-based schemes (PCT) from the state-led approach (INCRA). The panel data analyses were supplemented with estimations that used aggregate census data with observations at the level of the municipalities, which allowed for the modelling of the impact of the land reform variables across the sampled rural localities.

A first analysis of the residuals for the resultant models led us to conclude that data transformation would be essential to bring the distributions closer to normality. We thus performed simple log transformations of the variables (i.e. tvariable = log(variable). Several of the variables achieved a normal distribution after this transformation, and all of the variables were more nearly normal than they had been. Based upon a second residual analysis, these models were better fitting but still not perfectly fitting models. Consequently, to get the best models possible, each variable that exhibited significant deviation from normality was individually transformed to achieve as normal of a distribution as possible. To accomplish this, a Box-Cox analysis was performed for each variable. The output from the above mentioned procedure was the optimum lambda value for transforming the variable to a normal distribution. The transformed variables from this process were as close to normally distributed as we could get without excluding data. The procedures were repeated for the cross-sectional analyses resulting that we had found satisfactory models. Although the residuals of the models were normally distributed, there were still some significant outliers. The conclusion was that we found acceptable models that still showed a tendency to break down when unusually high predicted values resulted. However, some tests were performed in each regression to check the reliability of the occurrences. For instance, the Durbin-Watson test was used to detect the presence of autocorrelation between variables.

In most cases, the local-level analyses generally confirmed the empirical analyses based on rural territories with a reasonable degree of certainty (10% confidence intervals). The regression results were shown in the form of tabulations allowing us to identify whether or not the dummy variables were likely to be genuine predictors of the analysed socioeconomic indicators in the selected areas. The findings were then used to recommend the courses of action for designing the survey of Chapter 4, where the quantitative analysis was more objective and descriptive in nature. The goal was to specify, as much as possible, the observed effects of the Land Bill Programme on the living conditions of beneficiaries. Primary sources of data were needed so that the method involved fieldwork. As a consequence, a smaller number of cases were dealt with. However, our sample was representative of the population of interest in a number of aspects, particularly in terms of agro-climatic, socioeconomic and geographic features. Moreover, although the data analysis in that chapter was non-statistical due to the small number of cases (13 land reform sites), direct comparisons were possible being made between settlements so that the information which emerged thereafter was generally richer than the data obtained from the pure statistical analyses.

The techniques involved the administration of questionnaires (30-40 questions) with a wide range of response options (2-10) to a sample of randomly selected respondents made up of 260 rural households who received PCT loans in the period 1997-2002. Sampling was arranged by randomly picking out households from the surveyed sites. The research team then requested one adult per household to respond to the questions. The questionnaires focused on settled families’ own assessment of the Programme in terms of physical structure such as plot location, plot size, type of housing, availability and use of key services (electricity, piped water, sewage, etc), infrastructure for agriculture, access to neighbouring towns and markets (roads, public transportation, etc), means of transportation, and socioeconomic elements such as access to education and degree of schooling, health, and family income. Since the survey also aimed to assess beneficiaries’ views of the policy, households were also presented with open-ended questions regarding any other improvements as well as difficulties resulting from activities on the settlement. We did this amongst various groups of settlers, such as settlers living and working on their plot as well as those working on nearby farms or adjacent towns.

Since official census data and data from our fieldwork were not entirely comparable, a second type of questionnaire was administered to a sub-group of settlers consisting of settlement leaders, also known as project headmen, who were presumed to apprehend the overall picture of the sites. The main purpose of this questionnaire (two respondents per site, totalling 26 respondents) was to obtain a more comprehensive understanding of: (i) the overall infrastructure on and around the sites; (ii) how the settlers organised activities, farm and non-farm; (iii) the impact that such activities were having on their standard of living; and (iv) the relationships between the economic performance of the sites and the local and regional economy. The questionnaires used during the course of the field work are detailed in Annexes A-1 and A-2. The responses were quantified in frequencies, so that the resultant information offered an accurate picture of how the analysed aspects of the Programme affected the universe of respondents, besides providing ground for an evaluation of the achievements of the PCT in the rural economy of the visited localities.

The quantitative analysis of Chapter 4 was followed by qualitative research in order to 1) explore the quantitative findings further, 2) understand the processes and framework within which the schemes were implemented, 3) uncover the socioeconomic conditions of households living in PCT settlements, 4) gain an understanding of the viability of the Programme from the point of view of the stakeholders, and 5) confront their insights with the results from the quantitative research. The main advantage of using both methods is the cross-checking of findings, resulting that the findings have been largely conclusive regarding our research. Our qualitative research techniques included unstructured/ semi-structured in-depth interviews with settlement leaders, landlords and land agency officers, as well as open-ended questions enclosed in the quantitative questionnaires. The interviews lasted between 45 and 60 minutes in average, and there were no “right or wrong” questions. We assured the interviewees that the information would remain confidential and there would be no “reprisal” from their responses whatsoever, so they were asked to be as frank as possible in replying to questions. For these cases, we used discourse analysis to infer information about the many particulars of life in the PCT settings, and also to uncover the underlying reasons motivating the families to stay in their land or otherwise abandon the plots. Part of this information is presented in the form of descriptive texts by citing interviewee’s own words.

Eventually some patterns came forth from the collected data, with the findings providing a thorough understanding of the issues involving the implementation of land reform schemes in the Northeast countryside scenario, as well as a sound base for developing the arguments entailing our main hypothesis, namely to assess the extent to which regional planning principles and practise, if systematically used, can combine market-based and state-led land reform schemes with a view to enhancing rural livelihoods and improving the reginal economy. This is the main goal of Chapter 5, where we assess the scope for a plan-led regional strategy in the particular framework of land reform in the Brazilian Northeast.

Table 1. {IC SEQ Table \* ARAB}: Summary of the methods used in the empirical chapters

Abbildung in dieser Leseprobe nicht enthalten

Findings from our analytical exercises guide the policy-oriented discussion of Chapter 5, which concludes the thesis with a series of observations on and implications for new policy responses for addressing the issue of rural deprivation associated with landlessness. Moreover, the chapter is informed by three main theoretical premises derived from the reviewed literature.

1) Mixed state-market approach: Land reform theory provides the unified framework in which the chapter’s main issues are addressed. On the one hand, an important body of research on land reform sustains that the willing-seller-willing-buyer nature of market-based schemes imposes high transaction costs to poor land-buyers. On the other, an opposing view emerges that stresses the negative consequences of land expropriation methods on land markets, which has led to unlawful occupations of private property. Positive aspects of each approach, however, inspire a set of steps we take towards a data-led policy proposal. The challenge is how to introduce state-market mechanisms that help avoid increasing budget constraints in the region, particularly in less advantaged localities. Based on the planning literature, diverse possibilities of collaboration across the interface between the public and private sectors to acquire plots and deliver services and infrastructure are explored. Hybrid solutions to the land concentration problem are thus considered.
2) Integrated top-down and bottom-up approach: The incorporation of conceptual relationships between the governance structure of land reform schemes and the expected regional impact of the schemes is made through addressing the potential of said structure for intergovernmental coordination, particularly regarding the location of the sites and provision of large-scale infrastructure. In one word, how could the degree of involvement of the different government tiers affect land reform results? It is assumed that answering this question would involve taking into account the relationship between different government tiers in the pursuit of a combined top-down and bottom-up approach to land reform. Further elaboration is made on the participation of states and municipalities on the design of the policy as a way of securing that the nationally defined strategies are reflected on the ground. This blended top-down and bottom-up approach is expected to provide deeper insights concerning proposing a regional strategy that advances the developmental goals of the federal government and, at the same time, addresses issues of subnational interest.
3) Regional planning perspective: One of the basic points in the policy-oriented discussion is to identify plan-led mechanisms influencing the socioeconomic performance on land reform settlements at a regional scale, especially in reference to coordinating regionally prominent policy priorities to direct growth to strategically selected areas. Based upon conceptual as well as statistical considerations, therefore, the argument is developed around two main axes. The first axe is based on the need to establish a portfolio of sustainable areas for land reallocation prior to the proper intervention. The second axe involves the establishment of a portfolio of investment priorities for those areas at the time of the intervention. The regional planning literature is then evoked to find common grounds for both axes in combination with the previously mentioned premises, namely the top-down/bottom-up and the state-market approaches.


Regional planning in the land reform literature: a gap to be bridged

2.1 Introduction

There seems to be doubts from the international comparisons in the previous chapter that the separate conceptions of market-based and state-led land reform are confirmed, in practise, as sufficiently qualified instruments of growth. Moreover, despite extensive bodies of research in developing countries have intended to shed light on land reform issues and their impacts on regional growth, the scope for plan-led government intervention towards sustainable development in the countryside has been given less than sufficient emphasis in most such studies. Against this background, it is recognised hereafter in this work that regional planning can play a pivotal role in designing land reform strategies that are at the same time economically efficient and socially inclusive. The overall aim of this chapter is thus twofold: 1) providing a theoretical framework for analysing the impact of different approaches to land reform at the regional level; 2) drawing lessons from the mainstream literature regarding the potential role of regional planning as a strategic governance tool, more specifically to identify possibilities of maximising the social and economic benefits of different approaches to land reform in developing countries.

First of all, what is land reform? There may certainly be a number of definitions attached to the idea of land reform depending both on empirical and theoretical backgrounds as well as on the nature of issues addressed. For instance, Warriner (1969) defines land reform as simply being redistribution of land rights for the benefit of the landless, tenants and farm labourers. Adams (1995: 2) goes further by including a political dimension to the issue: “land reform pertains to the remodelling of tenure rights and the redistribution of land, in directions consistent with the political imperatives underlying the reform.” An even more detailed definition is provided by Tai (1974: 11-12):

“Land reform refers to public programs that seek to restructure equitably and rationally a defective land-tenure system by compulsory, drastic, and rapid means. The objectives of reform are to attain just relationships among the agricultural population and to improve the utilization of land. The means by which these objectives are attained are government sponsored tenurial changes. These changes encompass both redistributive programs (land redistribution and tenancy reform) and developmental programs (cooperative farming and publicly instituted land settlement).”

According to the definitions above, land reform implies a mode of land policy that seeks to achieve a change in the landholding structure through direct or indirect intervention by the state. Even so, approaches have varied regarding the extent to which governments should intervene in the land market. For the body of literature that focuses on developing countries, this has meant two basic methods of land reallocation: state-led and market-based. According to the former, land reform has traditionally been viewed as redistribution of rural lands from landholders to landless peasants through discretionary government action, in this case expropriation of lands with or without compensation (Navarro, 1998; Domingos, 2002; Borras, 2003). According to the latter, the role of land markets has been emphasised in at least three different ways: (1) privatisation of public lands (Swinnen, 2003), (2) creation or furtherance of land rental markets (Kung, 2002), and (3) inducement of land sales (Buainain et al 2000; Deininger et al, 2004; Neto, 2004). This work focuses on the effects of reforms concerning sales of private lands in comparison to the expropriatory approach.

Secondly, what’s regional planning? In a seminal study that has proved enduringly influential, Friedmann (1963: 171) defines regional planning as “the process of formulating and clarifying social objectives in the ordering of activities in supra-urban space”. For the author, regional planning involves decision-making concerning project development for investments in a regional economy, such as designing and placing infrastructure and other pro-growth activities in a regional outreach; by strengthening the relationships between social purposes and spatial arrangements, it also involves the efficient employment of a range of poverty-reducing resources across areas significantly larger than individual cities, hence being closely related with socioeconomic development initiatives of a regional scope. In brief, regional planning provides “the most suitable frame of reference for a balanced integration of development projects of national significance and those based on local initiative.” (p. 168).

Undoubtedly, empirical evidence from developed countries has demonstrated that regional planning strategies are suited to address economic and social issues that call for a regional focus. Interesting examples are found in the Netherlands, where three rural planning systems exist jointly: spatial planning, environmental planning and water management planning (Van Lier, 1998; Aarst et al, 2007); in Wales (Marsden et al, 2004), where a rural development policy network has been expanding into a multilevel governance structure; or in France (Buller, 2004), which have adopted a multifunctional planning strategy covering the non-metropolitan space to ensure that sub-regional cohesion is promoted through links between farming and non-farming activities. Regional planning for farmland development and preservation is also embedded in substantial state-level legislation in the United States of America, with provisions that involve a range of planning techniques such as agricultural districting, agricultural zoning, and easement through purchasing development rights by the state (Lapping and Szedlmayer, 1991).

Yet another far-reaching definition of regional planning and its functions is found in Benfer (1996: 618), which we accept as the starting point for the examination of the land reform literature in the following sections:

Regional planning is to be understood as the supra-local and comprehensive state-wide planning in the spatial context of a region by which the natural and economic bases and conditions for human existence should be secured and developed.

A vital element in the regional planning process is thus a capability to lay down strategies to achieve inter-generational development in the context of a region, whereby a need emerges to integrate planning theory and practise and land reform policy in regions of greater need. Moreover, looking at factors influencing land reform policy-making and implementation across the developing world, as well as their implications with respect to social inclusion and economic growth, is a prerequisite for establishing the potential of regional planning to improve living conditions in particular settings, on the one hand, and socioeconomic indicators in areas beyond the reformed lands, on the other.

This survey of the state of the art is divided into seven sections covering the themes that emerged in the process of review. In this introductory section, we have presented the review objectives and outline definitions for the main terms used hereafter. The second section traces the literature on the historical antecedents of land reform programmes in developing countries. In the third section, prevalent works on the socioeconomic circumstances influencing the access to rural land in these countries are covered. The fourth section and fifth scrutinise respectively the bodies of literature on governmental intervention and the role of planning in land policy. In the sixth section, we comment contemporary scholarly research focusing on the Brazilian case. The last section gives the concluding remarks and summarises the review.

2.2 Historical background: tracking back the roots of land reform schemes

A retrospective analysis of land reform initiatives in the literature is necessary to understand the current landownership structure in developing countries. A number of studies have provided a clear picture of the underlying historical circumstances affecting land policy approaches. Also, the historical factors driving different stages of countryside development within those countries have come to the fore. For instance, prior to discussing the conflicting political powers shaping rural reform in Colombia, Fajardo (2002) gives an account of key historical events taking place in the first half of the twentieth century to set up the background for the current tensions endangering sub-regional development in the Colombian countryside. Along remarkably similar lines, Ho and Spoor (2006) explain how the collapse of the former Soviet Union in 1991 had far-reaching consequences for the socioeconomic status of non-urban citizens in transitional economies and why these events influenced the shaping of land titling arrangements in order that land concentration could be avoided. Chauveau (2002) contextualises land tenure in Cote d’Ivoire within the historical path of agriculture activities with the purpose of estimating the effects of the 1998 legal provisions on rural land ownership. Finan (2007) draws attention to the fact that recent increases of agriculture output in Peru have been chiefly ascribed to the 1969 agrarian reform, when vast rural properties were expropriated by the Peruvian government, and the resultant plots were redistributed to groups of former farm workers.

Gould (2006) and Musyoka (2006) argue in an analogous fashion that a systematic interpretation of the challenges facing people attempting to obtain land regularisation in specific rural settlements requires examining the historical facts and events leading to the creation of those settlements. In the cases of Guatemala and Kenya, respectively, continuous processes of displacement of indigenous people from high-quality lands as a means to implement agrarian policies were frequent courses of action during colonial times. It is reported that the resulting highly inequitable land allocation has become a source of conflicts involving rural landless and landowners. In order to appease the contenders, governments have attempted to develop more appropriate policies and legislation, such as land restitution and redistribution schemes. Likewise, De Bremond’s (2007) account of the trajectory of El Salvador’s rural landownership explains how a peace agreement between guerrilla groups and the Salvadoran government influenced later time land reform programmes in the country. Current state-market hybrid land transfer schemes in El Salvador have thus been a product of political negotiations following nearly 12 years of civil war. Hence, by analysing diverse characteristics of the countries’ rural history, the above studies seek to bring about a context for the subsequent exposition of particular aspects of contemporary land policies.

Analyses of previous experiences with land reform are also found in contributions by Deininger (1999) and Deininger and colleagues (2004), as a means to assess the potential for implementation of successful schemes. In their view, governments’ approaches to land issues tend to shift substantially over time, dependant upon political as well as economic motivations. Amongst some given examples are the cases of Peru, Nicaragua, Honduras, and Cuba, where large pieces of land were redistributed exclusively to local farm workers in the decades following the end of the Second World War, but agricultural outputs in the reformed farms were far less than expected principally owing to a lack of complementary infrastructure and pervasive labour problems. Learning from such experiences has led governments in diverse countries of the tropical South to suppress, or at least significantly narrow down, their agrarian reform interventions, putting in place instead land registration and titling schemes or market-led redistribution programmes.

An opposing point is made by Borras (2005), for whom the failure of past government interventions in the countryside should not be judged only by the level of production settled rural areas, but also by the fact that the programmes did not aim at eliminating the persistent land monopoly as an underlying cause of rural poverty and unrest throughout the twentieth century. In a similar vein, Petras and Veltmeyer (2007) set forth that a long record of violence by the state against the peasantry fighting for arable land inspired the land reform programmes of the 1960s and 1970s in Latin America. Still on the same grounds, Assis (2006) recalls the scant results entailing the 1953 land reform in Bolivia to exemplify how biased legal provisions for land redistribution have been contested over time and, not less importantly, how the 1996 neoliberal land reform was deemed to meet the same fate for favouring the traditionally dominant groups, as had done previous arrangements.

The evolution of the state’s role in non-urban issues has also been the subject of much academic debate. Wegren (2007) gives an overview of Russian’s intervention in agriculture during both the Soviet and post-Soviet periods, showing that rural policies in Russia have seen state withdrawal in some respects, while in other policy realms the state has become even more interventionist. A correspondent study was made by Das (2007) about the history of government intervention in India. The author finds that some of the reasons that made capitalism the dominant mode of production in rural areas of India in the past still play a role in the modern state, hindering a successful government approach to the agrarian question through land reform. Also in Mexico, Van Der Haar (2005) asserts that land reform processes stemming from the Zapatista uprising in the early 1910s had far-reaching political and social consequences that were vital to understanding the role of the Mexican state over the twentieth century.

Indeed, a number of authors of different schools in the land reform literature have placed the status of land ownership into a broader historical perspective. Land tenure systems are believed to have been evolved over time resulting from a host of factors including labour migration to and from non-metropolitan settings (Li and Yao, 2002), violent dispossession (Brink et al, 2005; Ijagbemi, 2007), recognition of indigenous ownership (Justiniano, 2002; Assies, 2006), anthropological determinants of land possession including tradition and patrimonial relations (Diop, 2002), state-sponsored collective use of land (Valleta, 2002; Wegren, 2007), customary authority and colonial legacy (Chimhowu and Woodhouse, 2006), scarcity and competition for land (Basset and Crummey, 1993), or even failures in preceding land reform experiences (Van Der Haar, 2005). Accordingly, for a range of studies in the academy, government approaches to land policy have been shaped one way or the other by historical factors, although commentators do not necessarily share the same views about the extent to which such events continue to determine current land reform policy in less developed economies.

2.3 Seeking the socioeconomic determinants of land allocation

The concept of regional socioeconomic development is well established in the literature as being a sustainable growth rate increase that improves the overall well being in different regions within a country. The socioeconomic status of people living in the countryside is found in the literature to have connections with a number of factors, such as the degree of land concentration (Domingos, 2002; Brink et al, 2005), the level of household income (Valletta, 2002; Hoogeveen and Kinsey, 2001), employment opportunities (Ferreira, 2001; Rigg, 2006), instances of violence and conflicts (Hoefle, 2006; Petras and Veltmeyer, 2007), access to the credit markets (Sahu et al, 2004), agricultural output and productivity (Fajardo, 2002; Finan, 2007; Spoor and Visser, 2004) and access to services and basic infrastructure (Sparovek, 2003; Spencer, 2007; Harttera and Boston, 2007).

Contributions from the academy abound that identify close links between the status of rural tenure systems and the well-being of rural dwellers. In some cases, the situation in the countryside is believed to depend on the socioeconomic condition in urban centres and the overall state of the economy. Also, a number of studies suggest the other way around, and there is a variety of perspectives on the matter. A brief review of evidence across developing countries illustrates that the relevance of such perception for land policy formulation should not be neglected for a variety of country-specific reasons. Different stages of rural development in regions within countries have also been taken into great account to estimate the overall success of land redistribution efforts in improving the welfare of people living in the countryside. The role of land policy to achieve broader socioeconomic development is, nonetheless, an issue that requires a long-term approach. Notwithstanding, some patterns have emerged in the literature.

The relevance of land-based activities to ameliorate the economic status of the peasantry has long been recognized by observers such as Haggblade et al (1989). By analysing a profuse supply of data and earlier research on the size, nature, spatial distribution, and growth prospects of non-urban enterprises in Africa, those authors compared the share of both farm and non-farm sectors in the development path of the sub-Saharan countries. They found strong linkages between ownership of productive rural properties and poverty alleviation, and inferred that stimulating agricultural activity through a socially inclusive network of production and consumption can generate goodly income and employment opportunities, even in the rural non-farm economy. However, more recent research findings from Africa demonstrate that rural poverty remains strongly associated with insufficient access to land and livestock, in addition to a persistent incapacity of multiply deprived peasants to find non-farm alternatives to decreasing opportunities in the farm sector (Ellis and Bahiigwa, 2003). Empirical evidence from Asia and Latin America has also indicated that land policies aimed to strengthen the association between landownership and rural welfare are likely to contribute to the overall economic growth in those countries (see, amongst others, Murray, 2001; Barnes, 2003; Rigg, 2006; Deininger et al, 2007).

Undoubtedly, much investigation has been conducted on the social and economic effects of land policy on the countryside. In Benin (Dijoux, 2002), rural poverty has been found to be inextricably linked to inappropriate land allocations resulting in smallholdings of restricted economic sustainability. Finan (2007) looks at implications of the economic conditions of Peruvian small farmers for the socioeconomic sustainability of the export agriculture in coastal regions of Peru. In a highly quantitative approach, Li and Yao (2002) use sophisticated econometric methods to estimate the effect of the Chinese landholding system on rural wealth. It is found that more egalitarian land distribution structures have yielded better socioeconomic prospects, as land represents a source of productive input that supplements rural workers’ labour earnings. The size of the redistributed plots is also believed to make a difference, as seen in Ravallion and Chen (2004). For the authors, sustained rates of poverty reduction in rural China were a clear response to changes in the landholding structure beginning in 1979, from collective large sized farms to smaller family-based units. Many other observers in this school, namely Hoogeveen and Kinsey (2001), Ellis and Bahiigwa (2003) and Barrett et al (2005), provide further compelling evidence from a wide range of countries that equity in land allocation is positively associated with decreased poverty rates.

A second group of studies focuses on the effects of socioeconomic conditions on the success of land redistribution strategies. Fajardo (2002), for example, makes an appraisal of the land tenure system and associated social problems in Colombia, presenting data on the economic situation in settled rural areas that could direct later time land reform policy. Ho and Spoor (2006: 580) also assert that “by proceeding with land titling under conditions of low socioeconomic development, the state risks creating what is here termed as an empty institution rather than a credible institution”. Gould (2006) uses a case study approach to assess the impacts of land regularisation programmes in Guatemala. The results show that the predicted benefits of the reforms were strongly constrained by socioeconomic elements, specifically in rural communities located in frontier regions. Also in the Philippines, where roughly half of the country’s workers were employed in the agricultural sector, some features of the rural economy caused a remarkable impact on the Filipino political institutions (Borras, 2005). However, since most of rural workers’ needs were overlooked by the 1988 market-driven land reform, rural poverty remained widespread. Comparing land scarcity across African countries, Brink et al (2005) conclude that whenever population expansion makes arable land less abundant, property rights to land become more institutionalised and unlikely to change.

The role of social movements in land issues permeates a considerable parcel of the literature, mostly Marxist in orientation. Approaches of the kind have been taken by scholars including Petras and Veltmeyer (2007), who believe that class struggle over state power in Latin America is one fundamental avenue to social change in the non-metropolitan ambiance, and Das (2007), for whom land policies in India have been influenced by class struggles between the dominant capitalist class and lower classes. Yet a more nuanced, non-Marxist view of the matter is appreciated by Desmarais (2008). The author explores the tensions that exist between the expansion of peasant movements3 and their stated commitment to represent land-related interests of non-urban communities in the policy-making process. Whatever the case, scholars with both Marxist and non-Marxist views expect direct peasant involvement in land reallocation to play a part in turning sustainable development over to exurban areas.

The impacts of globalisation on rural socioeconomic development have also been subject to much concern amongst academics and development specialists. Soderbaum and Taylor (2003), for instance, rely on a collection of contributions based on local experience in the Southern Africa region to provide a useful study of the changes in rural dynamics that could be ascribed to the countries’ engagement with the global economy. According to their findings, a series of economic, political and social implications have given rise to the creation of institutions capable of integrating the non-metropolitan sector into cross-border agricultural activities. Likewise, Murray (2001) analyses the unfolding of a so-called second wave of globalisation in two Pacific island nations by means of original research-oriented case studies, with particular consideration to the rural-agricultural sector. He discusses the main local socioeconomic implications of globalisation in a broad and carefully contextualised analytical attempt to identify the mechanisms behind the region’s gradual insertion in the global agricultural market, and eventually proposes institutional strategies of resisting its negative implications. Various studies have already given detailed accounts of the economic circumstances associated with the unequal landownership structure in Brazil, including the displacement of family farmers due to globalisation or the economic and social crises that affected non-urban sectors over many years (Fabrini, 2002; Teófilo and Garcia, 2002; Fernandes, 2004).

In short, a large body of research demonstrates that changes in land tenure systems can have an impact on the socioeconomic status of people in the countryside. De Soto (2000), for example, points to the importance of land reforms as a way of improving the attraction of capital, and such evidence has in itself made land reform a highly debatable issue in academic circles. On the flip side, various country case studies seem to confirm the reverse assumption that land reform initiatives might be shaped by intense socioeconomic pressure, owing mainly to high levels of deprivation and social exclusion. Furthermore, a robustly negative relationship between unequal landownership and socioeconomic development is reported to endure in developing countries, adding to the plethora of causal factors, internal to the countries or from outside, that have contributed to failure of many land redistribution schemes implemented to date. The main message in this literature review seems to point out to the fact that governments have a clear role to play in lending strength to the mechanisms of high-quality land reallocation as a tool for sustainable growth in the countryside. This role necessarily includes designing legislation leading to an equitable transfer of property rights.

2.4 The legal framework and scope for government intervention

In general, a large legislative tradition can be found in developing countries as regards land reform that in some cases dates back to colonial eras. Correspondingly, the legal perspective on land issues has been widely examined by scholars in the developing world. For one thing, the form and content of legislative provisions define the range of governmental involvement in the dynamics of the rural sector as a catalyst for social and economic advancement. That is a major reason why the core of the literature highlights that granting landless families a plot of land is an issue of national policy (Barnes, 2003; Van Der Haar, 2005; Assies, 2006; Wegren, 2007). Nevertheless, some have stressed that local government interventions are quintessential to supplement central level rural development initiatives (Douglas, 2005). Consequently, multi-level analyses are commonly reported. In addition, Ho and Spoor (2006) indicates that numerous contributions in the field of land reform give primary attention to vastly contested institutional arrangements dealing with land titling and registration. Extensive and often critical assessments of land reform attempts by the Brazilian government have also been made (Domingos, 2002; Ramalho, 2002; Silva et al, 2006; Pereira, 2007). Approaches to the matter vary across academic writings in terms of methodology and coverage, depending largely on data availability and country-specific circumstances.

In broad lines, study contents comprise but are not limited to the background or initial experiences involving statutory regulation of land issues, as well as the measurable impacts of the proposed legislation to rural development and future challenges to state regulation. Valletta (2002), for instance, reflects on the shortcomings in the laws regulating collective land use in Ukraine, where a land lease share system was established in order to become the chief legal mechanism determining the relationship between farm enterprises and the peasantry. While investigating the factors restricting the expected outcomes of the laws, the author implies that further improvements in the legislative framework could effectively provide non-urban workers with better living conditions. In turn, Chauveau (2002) contextualises the legal bases for rural policy in Côte d’Ivoire by looking at key features of land tenure and their impacts on the behaviour of various actors in the state and society to predict the real benefits the 1998 rural land law was expected to deliver to non-metropolitan communities. A shift in approach is seen in Chimhowu and Woodhouse (2006), whose view of equitable allocation does not discard non-state alternatives to landholding. Their article draws on the example of some African countries that have reaffirmed customary rights other than legal arrangements as a more legitimate form of securing access to land by the under-privileged. Additionally, Barrett and others (2005) explicit that the type of rules a country adopts to tackle rural poverty matters less than the effective enforcement and monitoring of those rules.

As approaches to land issues in developing countries change over time, commentators also vacillate between liberal interpretations of property rights and more interventionist visions of land use regulation. Accordingly, much academic debate concerning the legal framework of land allocation has usually embraced the role of the state in the rural economy, yet opinions have sharply diverged on the desirable stretch of governmental intervention. In comparing instances of success or failure by the state, civil society and international organisations to tackle the problems of marginality and social exclusion in Latin America, Kay (2006) asserts that governments still have an active role to play. Li and Yao (2002) observe that China’s current land tenure system could be characterised as a rules-based response to the market’s unsuccessful attempts to provide egalitarian land distribution. As in Ho and Spoor (2006), this could lead to some instance of state control of market forces to impede emerging land markets from inciting further concentration of land in favour of a powerful minority. Borras (2003) renders a pro-state critique of recent market-oriented incursions into land policy, since previous experiences to merchandise rural land have fallen short of expectations. Similarly, Gould (2006) and Fraser (2007) warn of the problems of adhering to “neoliberal” rural policies. Justiniano (2002) and Assies (2006) view current market-driven legislation with ample limitations on its application and conclude that caution must be taken before departing from classic state-controlled approaches to land reform.

On the opposite side of the debate, Deininger et al (2004) argues that much of the inequality observed in land ownership distribution has derived from former non-market interventions. Their argument is based on a comprehensive survey conducted in Colombia to compare the performance of land markets and state-led land reform. Interventionist land reform, they so concluded, was by far less effective than were land markets in conveying rural land to the landless, although they admit there might have been some exceptions. The socioeconomic unintended results of increased government intervention in Russia’s agricultural sector are examined in detail by Wagren (2007). A crisis of legitimacy is anticipated by Das (2007), on account of persisting failures on the part of state to guarantee development embracing the interests of the peasantry in rural India. Dysfunctions of state administrations have also been cited amongst the causes of governments’ failure to tackle the difficulties facing peasants (Xiande, 2003). Back in 1983, an interesting study by Shrestha and Apedaile had already found that only in exceptional cases was the state apparatus amenable to rural development requirements in Nepal. A wide step away from state control over land markets, nevertheless, is advocated by Neto (2004). Judging for the preliminary results of the market-friendly land redistribution schemes still under implementation in South Africa at the time, the author salutes the programme as a useful alternative to more conventional forms of state intervention in the non-urban sector. The results and the very nature of the land reform schemes in South Africa remains a highly debatable subject in literature, however. Fraser (2007), for example, takes a hybrid position in arguing that the distinctive geo-historical context in that country has in some cases led the government to combine market-led approaches with direct forms of intervention laying down regulations for land use.

A great divide in the literature is thus observed that casts either the national governments or the market itself as culpable for landownership imperfections. However, mainstream scholarship concurs to the perception that neither the markets nor the government alone are likely to be able to overcome the detrimental effects of land concentration in the rural sector. For example, the seminal work of Deininger (1999) claims that building and institutional capacity propitious to equitable land allocation would require interaction between local and central authorities, in addition to the involvement of the private sector and NGOs. By and large, associated arguments in the literature (Bahiigwa at al, 2005; Sonn, 2007; De Bremond, 2007) have been constructed on the grounds that, if completely insulated from society, the state will miss political support to implement its policies, assuming, as theory poses, that rural development is a multidimensional phenomenon (Douglas, 2005). Accordingly, extensive coordination with different sectors would be a sine qua non condition for the pursuit of integrated projects and thus close the development gap between urban and non-urban areas (Banya, 1989). Some conditions for participation and state-society interaction, as well as their benefits for the landless poor, have been identified by Nuijten (2004) and Das (2005). Thus, a range of joint strategies are believed to provide the basis for a more effective role of the state in overcoming deep-rooted socioeconomic problems in the rural world.

2.5 Land reform for socioeconomic development: a gap

The problem of slow rural development has persisted in so-called Third World economies despite numerous land reform initiatives counting on different degrees of government interposition in land-related issues. Brink et al (2005) have identified some progress regarding poverty reduction in the South-East Asian countries of Indonesia, Malaysia and Thailand, adding however that these countries have also made substantial investments in rural infrastructure to assist land reform beneficiaries. On the other hand, Deininger et al (2007) report serious obstacles to the expansion of the informal non-farm sector in Sri Lanka. Their study concludes that infrastructure constraints impose high barriers to entry for poor peasants, but yet it does not present regional planning as a strategic governance tool for the creation of effective collaborative networks intent on obtaining sustainable socioeconomic growth.

The use of land reform as a mechanism to fight poverty has generated a lot of interest within Brazilian academic circles as well, and much research has been carried out to analyse the impacts of various aspects of land redistribution programmes targeting people who do not have the means, material or otherwise, to obtain land. A variety of issues have been dealt with over the years. The spread of deforestation as a consequence of the prevailing land-tenure system in the Amazon region has been examined by Fearnside (2001). A survey conducted by Silva and Del Grossi (2001) in the Southeast and Centre-West regions of Brazil reports that families who depend solely on farm activities earn lower income on average than households that perform multiple activities, i.e., activities in both the agricultural and non-agricultural sectors, and than non-farm rural workers. In the frontier context, Ludewigs (2007) finds that access to urban centres and use of agricultural credit are amongst the variables strongly affecting settlers’ life conditions. Additionally, nationwide studies by Sparovek (2003) and Heredia et al (2006) are amongst the most recently cited references in this field. Whereas the former measures the achievements of settled families’ agricultural production on regional development, the latter focuses on beneficiaries’ quality of life in settlements. A lack of systematic data on the real situation of peasants in many redistributed plots has, nevertheless, precluded more comprehensive inferences regarding the overall socioeconomic impacts of the schemes.

Additionally, it stands to reason that an absence of concerted actions has contributed to failure of both market and non-market attempts to reduce poverty, a key element underlying sustained socioeconomic enhancement in the Brazilian rural sector. As a matter of fact, there is very limited evidence in developing countries of the use of comprehensive regional planning as a key vehicle to ensure the wider socioeconomic impacts originally intended by land reform programmes. However, a number of cross-country comparative studies have tried to recognise the elements contributing to inveterate poverty in less developed economies.

In Herrera and Roubaud (2005) variables associated with the provision of public goods and services, education, health and employment, amongst others, have been pondered. The possibility of entering the job market, as well as infrastructure features in the location, have been rendered as relevant factors leading to exit from chronic deprivation. In general, such contributions have focused on access to basic services and proper infrastructure as a valuable step forward. However, the great majority of studies in developing countries cover urban or peri-urban areas where infrastructure efforts by the state have been concentrated upon. A panel data analysis in that regard is performed by Arimah (2003) on the provision of primary infrastructure in African countries from a cross-city perspective. The author’s investigation imparts that public sector expenditure is a significant variable explaining intercity differences in the provision of basic infrastructure, in this case water, sewerage, sanitation, electricity and telecommunication services. A similar analysis is made for Israel by Portnov (2002), who looks at intra-urban variations in income levels. He finds the distribution of income across population groups to be a function of housing and commuting expenses, amongst other determinants, and then proposes a series of development strategies that include public housing construction for low-incomers and ameliorating peripheries’ physical infrastructure.

Some academic discussions seem to be adamant that the ideological dimension affects planning systems, particularly in developing countries. For instance, whilst approaching the elaboration process of the new Spatial Planning Act in Indonesia, Hudalah and Woltjer (2007) pay attention to the relationships between peculiar institutional-cultural patterns and the global neoliberalism. The authors acknowledge that, as much as neoliberal ideas were not able to profoundly modify the nature of the planning system, those ideas could conflict with the cultural forces shaping the existing planning policy and practise. Notwithstanding, it is also admitted in the Hudalah and Woltjer’s study that some principles promoted by the neoliberalism, namely decentralisation and the rule of law, should be adopted on behalf of a more efficient planning system. A more general and even more straightforward criticism of neoliberal conceptions of planning is set down by Ellis (2002: 263):

“Free market enthusiasts reject meaningful urban and regional planning. Their arguments are characterized by an endemic short-term economic logic, a historical analysis of urban problems, blindness to the distortions caused by concentrations of private power, and excessive faith in the virtues of markets without a corresponding sense of their limits”.

For the segment of the literature dealing with the rural space, the integration of exurban areas into economic growth processes requires governments to move away from a sectoral approach in direction to creating sub-regional policy networks in the economy and society (Marsden et al, 2004). By working in many fronts with different actors, the state would not only expedite land access by land-poor families, but also implement more effective growth-oriented measures overall. Dale (2000) has already sustained that regional development programmes could be more effective should developing countries opt for more flexible instruments such as decentralised planning processes, coupled with monitoring systems and coordination, so as to encourage initiatives from below. On the other hand, Sonn (2007) points out that it is recommendable in some cases that national authorities take precautions during the planning-making process not to allow local governments to channel resources into their own backyards. Corruption and rent-seeking behaviour, he recalls, were amongst the main causes leading central governments in underdeveloped countries to remain so insulated from lower tiers while implementing developmental policies (also Banya, 1989). Smith (2006) corroborates with the idea that for strategic planning to become an effective tool where bottom-up approaches predominate, there must be a will to reconcile local and regional interests.

A study by Spencer (2007), taken as a sound example, explores possibilities of central-local partnerships to provide clean water and sanitation for the poor in Vietnam and thus help the country meet the challenges of the United Nations’ Millennium Development Goals,4 while making a rapid transition to a market economy. Another absorbing question featuring a series of papers emphasising pro-growth networks is how to bring about an institutional capacity to conciliate renewable natural resources conservation with the appealing goal of mitigating rural poverty (Alston et al, 2000; Barrett et al, 2005). Conclusions converge towards the need of a suited space for planned conjunct actions to map out the actual situation and specify the goals and means required for achieving environment-friendly rural development. Rist et al (2007) illustrate these ideas with case studies from rural communities in Bolivia, India and Mali.

Opening space for comprehensive planning initiatives has been a common recommendation arising from the literature examining diverse aspects of public policy in the developing world. The goal of providing affordable housing following processes of land delivery in Nigeria has been examined by Ikejiofor (2005) against the need to develop an institutional capacity to meet the government’s rural policy commitments. Whilst assessing the role of municipalities in fighting poverty, Parnell (2004) realises the increasing importance of creating better organisational interfaces between political and administrative functions to answer the critical question of how to foster distributive justice. Mather (2004) discusses the benefits of designing more effective ways than simply imposing codes of conduct to restructure the agricultural labour market in South Africa, in order to improve the conditions of farm workers. As slum relocation has become an enormous challenge facing crowded cities in Thailand, Viratkapan et al (2004) acknowledge the requirement of specialised activities at the formulation and consolidation stages of the projects.

Although the above accounts are few and space has permitted only the briefest considerations, it is inferable that recent planning literature on developing countries has put emphasis on urban contexts as opposed to rural settings. Most importantly, mainstream academic findings seem to fall short of the idea that regional planning can perform a paramount role in integrating market and non-market channels towards undertaking one of the greatest long-term challenges facing land reform policy-making and implementation in developing countries, namely fighting rural poverty along with improving tenure security and sustainable growth at a regiona scale. A snapshot of the up-to-date literature has thus revealed that land reform initiatives in developing countries remain scarce that adopt comprehensive regional planning strategies, although either state-led or market-based approaches have been reported to harness punctual deficiencies in the rural sector. Thus, plan-led efforts are needed to bridge this perceived gap in the cutting edge of policy-making associasted with land reform.

2.6 Regional planning in land reform: a bridge

The literature reviewed in the previous sections has unveiled a shortage of planning on a scale that is larger than the redistributed plots. Regional planning involves the efficient employment of pro-growth resources across areas significantly larger than individual cities (Van Lier, 1998; Smith, 2006). The idea behind regional planning in the developing world is more associated with the systematic design of state capabilities for intervention in specific regions of the countries for developmental purposes. In these cases, planning processes have mainly been used to remove obstacles to the expansion of the rural economy, by establishing pro-poor cooperative partnerships (Barrett et al, 2005), coupling non-farm alternatives with agricultural activities (Ellis and Bahiigwa, 2003), and others. Notwithstanding, although justifications for the use of regional planning in land reform policy-making may be plentiful at this point, the extent to which planning strategies can be employed in land reallocation in an efficient yet equitable manner depends on a range of factors, such as how to eliminate uncertainty and indecision in the regional planning process (Silva, 2002).

Plan-led endeavours in land reform policy, more specifically the redistribution of land in plans, should be about the allocation of an increasingly scarce resource (lands that are amenable to cultivation) to a more efficient use through giving guidance to assessing the economic potential of sites when redistributing land. This is especially apt to be the case if it is considered that the creation of market economies will be at the basis of more sustainable land reform policies, and proximity to existent markets might be a plus in such dynamics, areas close to those markets might be targeted as some of the most suitable places to enable a land reform capable of sustaining these deprived populations through time. Methods for targeting areas for policy implementation abound in the regional planning literature. For instance, Correiaand Madden (1985) use programming techniques to identify and earmark extensive pockets of land. Ottavianoand Thisse(2005) resort to microeconomic analyses of profit maximisation to examine the influence of geo-economic factors on location of firms, whereas Hubyet al (2009) recommend a combination of conceptual and statistical considerations, with a focus on the availability of natural resources in a region. By so doing, the state could induce changes in the economy of a region over the longer term (Mason, 1985).

A consideration of particular relevance to assessing land reform schemes in developing countries has been whether infrastructure services have been provided to increase the prospects for success of the programmes. Attention has been given to the need for housing and access to basic services, such as piped water, sewage and electricity by settled families. The role of large-scale infrastructure projects in promoting structural changes in the rural sector is well established in the regional planning literature. Fan et al (2007), for instance, consider improving the quality of rural roads to be essential for increasing agricultural output and reducing poverty, whereas Roberts (2003) maintains that rural economic growth is contingent upon the provision of public services to rural communities. Similarly, Denshamand Rushton(1996) understand that public services could even be reallocated to areas where they meet the needs of those communities. Chanand Clark (1994) argue that the main objective should be creating an adequate business milieu favouring disadvantaged rural populations, which could be achieved by channelling productive investment into critical sectors. Likewise, Baxter et al (2007) have found that government provision of critical infrastructure strongly influence businesses’ decisions to locate in an area.

The role of planning in land reform is not only to facilitate land redistribution, to make it more equitable, but also to give it spatial configuration. Accordingly, a polycentric pattern of growth has been advocated by authors such as Parr(2008) and Hansen(1975), who analyse the implications of adopting a growth-centre approach to regional development. Failure of land markets to provide homogeneity in the spatial distribution of land reform sites means that if no planning is involved, the outcome can be increasingly segregated sites. Relying on market mechanisms for an alternative to administrative land reform will not overcome the problems of migration and overcrowding. It is argued hereafter that any governmental initiatives towards promoting self-sufficiency in the settlements require a sustainable appraisal of selected areas prior to the implementation of land redistribution schemes, combining strategies of state intervention, community participation and market forces. Ultimately, comprehensive regional planning should constitute an essential tool linking land reform outcomes to regional development in the resettled areas. Absence of planning is a risk for the sustained development of resettled areas without adequate account taken of social, economic and environmental impacts.

The focus of regional planning is on principles instead of striving to control development decisions at the lowest possible level. Articulation and coordination through multi-tier governance structures are thus widely recommended (Landiset al, 1991; Clark, 1994; Berkeet al, 1999; Lobao et al, 2009). This body of the literature stresses the importance of establishing cooperative arrangements between government tiers to obtain efficiency in the implementation of joint projects, with essential implications in terms of regional economic growth. For example, coordination can guide the distribution of land in a way that is necessary for the rural economy to develop with actions that include open land protection, land use controls, projecting the availability of workforce and the reduction of stock in low-demand areas. For Edelenbosand Teisman (2008), these forms of cooperation involve sharing resources and expertise toward improving both the quality and effectiveness of public policies on the ground. The role planning can play in coordination and collaboration at different scales is also highlighted by Allmendinger (2006).

Regardless the kind of land reform that is disseminated, the programmes could be attached to mixed strategies in a holistic approach to regional spatial planning (Pearceand Ayres, 2006). Ilbery(1993), for instance, notes that farming diversification could be an effective strategy to increase the profitability of settlements. Other methods would include influencing industrial location, improving the population’s labour skills, encouraging tertiary industries as well as the specialisation of activities in settled areas, and others. For Gwosdzet al (2008), all of these would require creating an adequate structure of incentives to establish the conditions for cooperation amongst all involved parties, and thus help the state to overcome the sternest challenges to ameliorate the deprived circumstances of those living in the countryside. This also requests the ability of combining views of different stakeholders into contributing to the nature and degree of regional development policies, what has been called “participatory strategic planning” (Loukopoulos and Scholz, 2004). For Silva (2002: 336), a perception that government and planners can work together with different land use actors could help eliminate “indecision factors such as availability of funding, instability of political systems, lack of institutional coordination, and time lags between consecutive decision-making processes”.

It has been made clear that planning at the regional level has an essential part to play in introducing plan-led strategies in a variety of resourceful ways, such as designing more inclusive land distribution mechanisms that facilitate access to quality land, or helping identify the proper incentives to bring public and private investments into strategically chosen areas to ultimately expedite major infrastructure improvements in the rural sector. In this particular aspect, the literature above seems to suggest that regional planning can (i) give a better basis for the location of land reform sites in areas of greater potential for growth within the region, and (ii) help avoid inefficient allocation of resources through recognising optimal funding solutions to the problem of inadequate infrastructure in the wider regional context. On the other hand, whilst neither the nature of state intervention through land reform nor market mechanisms of land transfer have been able to guarantee a more equitable redistribution of wealth in developing countries, it is vital to accept that market and non-market forces are not necessarily mutually exclusive vehicles to development.

Finally, the policy debate should not be limited to which model of land reform is best, or which theory of planning would best fit a country’s prevailing ideological trends,5 but rather what strategies governments could adopt as a gradual move to more efficient allocation of resources in order that the variety of developmental goals intended in the schemes be achieved. As far as that is concerned, land reform policy has to adjust to an environment where the planning logic of land redistribution is central to the economy and society. Drawing from the experience of several countries with state-led or market-based land reform, and from the literature on regional planning, it has become quite clear that integrating market forces with government intervention through a plan-led strategy would be a positive step in the right direction.

2.7 The literature at a glance

Undoubtedly, much research has been undertaken in developing countries where land policy either state-led or oriented to the market has been implemented, and most studies in these countries are quite inconclusive about the achievements of the schemes. It has also been implied from most of the literature that the programmes have been rather detached from comprehensive regional planning strategies. Whilst it may be true that prudence needs to be employed in comparisons of land use policy between countries due to striking dissimilarities with respect to socioeconomic factors, characteristics of their legal systems, and many other country-specific elements, the possibility of applying regional planning principles and practise to land reform in less developed economies must by no means be discarded if the goals of economic efficiency and socially inclusive regional development are to be achieved.

Whilst we would not wish to foreclose the debates about the optimal extent of state intervention in the land markets or the efficiency of those markets in redistributing land, this survey of the literature, summarised in Table 2.1, has provided a short compendium of existing research efforts in the areas of land reform and regional planning in developing countries, with a view to identifying alternative courses of action that could be capable to magnify the pro-growth benefits of land reform policy. Whatever analytical methods, theoretical presuppositions or ideological orientations, the underlying message in the reviewed literature is that a plan-led land reform strategy involving multiple actors should be seriously considered as a means to augment the probability of success of land redistribution schemes in developing countries, whether state-led or market-oriented, as regards sustainable development of a regional scope.

Table 2.1: Highlights of the literature: land policy and planning

Abbildung in dieser Leseprobe nicht enthalten


The socioeconomic impacts of land reform: an empirical exercise for the Brazilian Northeast

3.1 Introduction

Market-based land reform has been introduced in the developing world as an alternative to the traditional state-led mechanisms of land reallocation. Yet opinions diverge in the literature on the degree to which governments should intervene in the issue of land reallocation. Deininger et al (2003) and Neto (2004) for instance, find- that land markets are more effective in transferring land to the poor and, thus, fighting poverty than state-controlled land reform. Moreover, market-free schemes have led to informal transactions of land (Chimhowu and Woodhouse, 2006; Barnes and Griffith-Charles, 2007), and land occupation and expropriation engendering violence over property rights (Alston et al, 2000; Hoefle, 2006). On the other side of the debate, Ho and Spoor (2006) argue that the rural economy can succeed without allowing private sales of rural land. Likewise, Borras (2003) believes that rural poverty will always abound since market-driven reforms cannot prevent productive lands from remaining in the hands of powerful landholders. It is also asserted that without effective state intervention demands by grass-roots movements or organised peasant groups might end up excluded from the market-friendly schemes (Caldeira, 2008; Demarais, 2008).

Disregard the approach to land reform, however, the socioeconomic status of the reform beneficiaries is found to have connections with a number of different factors, such as the degree of land concentration (Domingos, 2002), the level of household income (Valletta, 2002), education (Banya, 1989), employment opportunities (Haggblade et al, 1989; Ferreira, 2001; Silva and Del Grossi, 2001), access to the credit markets (Sahu et al, 2004), agricultural output and productivity (Finan, 2007) and access to services and basic infrastructure (Arimah, 2003; Harttera and Boston, 2007). For the case of Brazil, a series of studies have focused on assessing living conditions in selected market-driven land reform sites (Buainain et al, 2000; Medeiros, 2007) or the effects of administrative land reform on land de-concentration or poverty alleviation (Heredia et al, 2006; Sabourin, 2008), without nonetheless comparing the broader socioeconomic impacts of approaches of either type. The following empirical exercise is an attempt to include the most appropriate elements leading to different outcomes at local and sub-regional levels as a result of land reform in the Brazilian Northeast.

We examine the socioeconomic effects of two different approaches to land reform in Brazil: the traditional state-led INCRA schemes and the Land Bill Programme (PCT), a market-based approach introduced in 1997. We focus on the repercussions of the schemes across a significant sample of 416 rural localities and within 49 rural territories6 adopting both schemes from 1997 to 2002. Our dependent variables are growth of farming GDP per capita, rural income and human development index. The independent (explanatory) variables have been selected based on the mainstream rural development literature (Fan et al, 2004; Sahu et al, 2004; Ezcurra et al, 2007). We use growth rates in order to eliminate locality-specific biases from the analysis as well as lagged (log) independent variables that contain information necessary to determine the effects of the policies across time. We also include a number of time-invariant predictors, namely measures of the rainfall incidence of each rural locality and distance to nearest capital city, as a proxy of remoteness.

The data analyses explore socioeconomic indicators of land reform sites from a regional perspective and evaluate the extent to which the reforms have been successful in providing social inclusion and economic growth. The estimations are carried out using multivariate methods to test the influence of PCT and INCRA schemes on the regional economy in combination with selected indicators. Panel data analyses of sub-regional-level indicators are performed that distinguish between fixed effects and random effects. Our local-level specification is a cross-section (although with various time-series information enclosed). Amongst the conclusions, we find that the expected socioeconomic outcomes following the adoption of either approach are not confirmed, which suggests that securing settlers’ rights to land will not necessarily secure sustainable growth at the regional level.

This chapter is made up of six sections. After this introductory section, Section 3.2 takes stock of characteristics of the case study areas that are particularly relevant for understanding the socioeconomic issues we discuss in the sequel. Section 3.3 discusses how Brazil has addressed the issue of poverty in the Northeast in connection to traditional state-led schemes and outlines the process of land redistribution under the Land Bill Programme. Section 3.4 examines key factors affecting the growth of the regional economy in the Brazilian Northeast and tests the influence of PCT and INCRA schemes on that growth through panel data analyses. In Section 3.5, cross-sectional analyses are performed to distinguish the effects of both PCT and INCRA approaches on social and economic indicators at the level of the localities. Section 3.6 summarises the chapter’s conclusions and presents final considerations.

3.2 The socioeconomic gap in the Brazilian Northeast

This section examines multiple interactions amongst factors affecting the performance of the regional economy in a sample of Northeast rural territories, in face of land reform efforts by the Brazilian government over the last decade. Analysis of these elements is necessary in order to make assumptions before elaborating on possible implications of adopting a plan-led approach to land reform ahead in this work.

The Northeast region of Brazil covers 1.6 million km², about the size of France, Spain and Germany combined, and has a population calculated at 53.5 million people, dispersed over nine states. The major urban centres are located along the Atlantic coast. The indices for human development are below average (for instance, longevity 0.61 and income 0.66, as compared to 0.73 and 0.72 respectively for the rest of Brazil).7 Since poverty is much more pervasive in the countryside, there has been, on the one hand, extensive rural out-migration over the years to the neighbourhoods of major urban centres and, on the other, the surge of favelas (slums). All the capital cities in the Northeast have in their periphery extensive slums of improvised huts built of cardboard where violence, diseases and hunger are a daily part of their population’s lives. Figure 3.1 shows the Northeast region and the State of Minas Gerais highlighted.

Figure 3.1: Brazilian regions

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The most deprived areas of the Northeast are concentrated, however, in the semi-arid and transitional zones. These are areas characterised by having semi-desert weather/ characteristics that comprise roughly 81% of the region overall. The average annual temperature in these zones ranges from 24C to 28C, rainfall is extremely erratic from year to year, and droughts frequently occur everywhere yet in varying scales of intensity. The annual rain precipitation averages 350 mm (in the coastal and rainforest zones it averages 1,700 mm) and there is close to no rain throughout the driest months (June to September).8 There is during drought times a further reduction in fresh water flow from the rivers feeding the area. On the other hand, the region is sporadically affected by inundations, particularly in key river basins such as the Parnaiba River and its tributaries. The soil in the driest areas is hard to cultivate (soil composition is mostly chalky and the surface is degraded by continuous utilisation), and the vegetative cover is characterised by flat grassland. Yet there are areas even in the semi-arid where the soil fertility is relatively high, such as Sertoes do Caninde and Sertao do Pajeu.

Demand for infrastructure and public services in these zones is high; public investments are in short supply. Tap water systems are precarious in many locations in the sense that the flow of indoor water cannot be guaranteed. Additionally, there is in most cities an environmental problem due to untreated sewage being released into the rivers flowing across the city and into the countryside, indicating high levels of coliform bacteria in the water used for irrigation and human consumption, only to become a source of water-borne diseases. For instance, a very considerable number of riverside communities suffer with dysentery and native bilharzias (an infestation with a resulting infection caused by parasites typical of the region’s rivers) and are still subject to acute viral diseases transmitted by the bite of mosquitoes.9 These environmental and structural features, combined with inequitable distribution of land, have produced a scenario of severe multiple deprivation. Additionally, land invasions in these areas have been linked to the escalating decline in economic resources (Domingos, 2002; Fernandes, 2004; Medeiros, 2007; Caldeira, 2008).

The Northeast countryside is characterised by high rates of unemployment (only 35% of the rural population actually perform some kind of economic activity) as a major determinant of rural-to-urban migrations and the resulting unregulated peri-urbanisation of large cities. Furthermore, almost 70% of the rural population in the region are poor, with their monthly per capita income not reaching US$20 in average.10 In these circumstances, benefit dependency is very high: in 2007, 5.5 million Northeast families benefited from the Bolsa Familia (a family voucher scheme), representing slightly more than half of the country’s beneficiaries. All sorts of cash transfer programmes, foodstuff baskets and a range of aid schemes from both government agencies and NGOs are valuable means of poor families’ sustenance. On the other hand, land reform sites remain to a high degree underdeveloped and poorly serviced.

Agriculture and livestock are key economic sources for the rural communities in the region, although only 7% the Northeast’s GDP comes from the farming sector. Small producers including producers on land reform settlements in the rainforest zones practise simple forms of farming. In the summer, crops are submitted to the dearth of water and intense exposure to the sun and agricultural yields register deep decreases. The severe shortage of rainfall brings in devastating implications: key productive activities in the sites are disrupted and crops are almost completely lost. Livestock activities are also severely hit. In such circumstances, families survive on the basis of their meagre savings or government aid and it is common that some households migrate to main urban centres in search of jobs. Coupled with the fact that most of the capital cities are located in resource-privileged areas, labour-intensive industries as well as large-scale plantations of sugarcane that similarly requires ample amount of human labour dominate the coastal zone of the region.

High landlessness (about 40% of the rural population) is an additional constraint. The region’s harsh agro-climatic features impose limitations on the availability of arable land for land redistribution schemes. Reflecting the broad picture in the Northeast, the majority of family-farms in the semi-arid and transitional zones are of small size (<100 ha), although the PCT projects in these areas have significantly smaller farms (less than 20 hectares per settled family). Both family-run farms and plantations of great scope strive on a highly unequal distribution of natural resources, albeit large single commercial farms are as a rule located on higher potential cultivable properties. Those large farmers (latifundiarios) occupy extensive tracts of land, which is a crucial land reform issue in Northeast Brazil, as grassroots peasant movements in the region have struggled over the years to bring about changes in the institutions of property and labour relationships. Between 1993-2002, about 2.3 million hectares of land on which crops could be grown or in areas situated at the vicinity of public-use facilities were expropriated from major farmers in the Northeast as a result of land occupations by movement activists.11

Briefly, a below average incidence of growth in rural areas of the Northeast has been seen in terms of per capita GDP and living conditions whereby a long history of government efforts to supply an increasing demand for arable land associated with high rates of poverty has taken place. However, as will be seen in the following sections, it becomes relevant to question to what extent the land reform schemes have effectively and sustainably achieved such objectives. By having a look at different approaches to land reform – from the rationale of the schemes, to the implementation phase of the settlements, to the impact on the local and regional economy – the analysis evaluates the land reform’s contribution to the Northeast’s development path.

3.3 The twofold sequence of the government response: state-led and market-based

The case for an interventionist approach to the landholding structure in Brazil has been based on the principle that redistributing large idle properties to small producers would be a decisive factor influencing the expansion of the rural economy, thence reducing rural poverty. This principle was embedded in the 1964 Land Law (Estatuto da Terra), which introduced the possibility of land expropriation with compensation as an attempt to “influence the decisions of private landowners in the direction of greater economic efficiency as well as toward greater social justice” (Senior, 1970). The implicit interventionist nature of the Land Law lies at the heart of the National Institute for Colonisation and Agrarian Reform (INCRA), a land reform agency created in the late 1960s whose main mission has been to encourage the organisation of settlements through expropriating lands and redistributing these lands to rural households interested in growing crops, but whose condition of poverty does not allow them to purchase land. INCRA has had overall control of implementation of state-led land reform policy by laying down directives concerning the responsibilities of local-level implementation agencies, including by influencing the appropriation of land reform budget resources.

The 1988 Brazilian Constitution reinforced the expropriatory powers of INCRA by imposing mandatory land acquisition, through expropriation, for the wider social interest (Article 9). Concisely, the expropriation principle means that if poor households occupy private rural land either through organised invasion or after one year of undisputed occupation, and if improvements are made on that land favouring agricultural production, such land is subject to expropriation by the state. The occupants are given a provisory title whilst awaiting the definitive deeds to be processed. As soon as the title is irrevocably transferred to the occupant, the former owner becomes entitled to a financial compensation, usually in the form of public bonds indexed below the inflation rate (Federal Law 8629, of 1993).

A justification to favour land expropriation over alternative budget-consuming schemes, e.g. straightforward purchasing of land with budget funds, has been given on the grounds that expropriations can be a relatively inexpensive choice, as land acquisitions are usually financed by long-term Agrarian Debt Bonds. The measure itself has been a highly controversial one, since “land owners historically have received less than the market value of their land in an expropriation” (Alston et al, 2000). The constraint of expropriation without fair compensation has instigated property owners to negotiate the occupied plot with squatters in hope of getting better prices beforehand. Otherwise, they would have no choice other than resorting to the Judiciary to claim higher values of compensation. A 2000 study conducted by the Ministry of Agrarian Development12 found that prices that have been paid for expropriations increase by the processes of land occupation, expropriation and subsequent litigation. The study concluded that the transaction costs associated with INCRA expropriations have raised land prices to about three times their market value.

In spite of that, land expropriations have been advocated for in terms of an urgent need to eliminate deprivation that could be ascribed to insufficient landholding (Law 8629, Article 19, VI). That same MDA study uncovered, however, that most households receiving title from INCRA turn out to be landless movement activists who invade rural properties, but not necessarily the ones who make productive use of formally redistributed plots. Most notably, the problem of creating unsustainable sites would lie in the very mechanism of ex post intervention:

“Occupation of a farm by landless rural workers is not oriented by an assessment of its production potential. Therefore, these criteria do not ensure that expropriated land is appropriate and suitable for agrarian reform settlements.” (NEAD, 2000: 9).

The study added that much of the expropriated lands remain unproductive due to factors as diverse as unfavourable economic conditions, inadequate land fertility and topography, deficient local infrastructure, and inaccessibility to consumer markets. Accordingly, the socioeconomic achievements of the schemes cannot be measured only by taking into account indicators of land de-concentration, given the fact that only about 60% of INCRA beneficiaries actually till their plot, as reported by Deininger (1999). The real aftermath, according to the mentioned findings, is that living conditions in INCRA settlements have generally been precarious.

As a matter of fact, the state-controlled model of resettlement was always expected to be complemented with basic infrastructure, including health care facilities, roads and housing. In addition, creating an INCRA settlement can be a very slow process, as expropriation procedures are, by definition, “lengthy and complicated” owing to a large bureaucracy entangling the federal agency and its many operating branches (Buainain et al, 2000). Consequently, an oversized budget has been required not only to finance compensations for expropriated lands, the judicial dispute following an expropriation, and a range of on-site services to help establish a family-farm system, but also to maintain the agency’s own bureaucratic structure. More importantly, besides lacking a specific regional strategy of their own, INCRA interventions have not been connected to other developmental strategies for the region.

The gradual realisation that administrative land reform was doing little to mitigate the burden of poverty on the rural poor eventually led the Brazilian government to reorient land reform away from a lone focus on expropriation of private properties to adopting a market-based model of land reform. In 1997, the Ministry of Agrarian Development launched the Land Bill Programme (Projeto Cedula da Terra – PCT), on account of a loan agreement between Brazil and the World Bank.13 According to the agreement, the Programme should target economically disadvantaged, landless individuals, or people with land insufficient for a livelihood, in deprived portions of the Northeast region. Before advancing to large-scale implementation, the policy was piloted in areas showing high levels of deprivation in the states of Bahia, Ceara, Maranhao, Pernambuco and Northern Minas Gerais, but not necessarily in areas of those states where past INCRA initiatives were recognised unsuccessful.

An essential purpose of the PCT Programme was to create a framework for bargaining according to forces of demand and supply, whereby registered families would be able to apply for loans to purchase land through voluntary negotiation, i.e. from landholders disposed to sell. Above and beyond all other consideration, the Programme was designed not only to ensure the redistribution of good, arable land, but also to supply a range of support services that might raise participants’ income and standard of living overall. Consequently, the PCT consisted of two dimensions. The first dimension involved providing credit for transfering land rights on a willing seller – willing buyer basis, with land reform agencies in charge of making sure that the properties be transacted at market prices. The other dimension concerned a second round of credit lines to finance small infrastructure projects, involving project-specific loans. In addition, a complementary loans-based scheme, the National Programme of Assistance to Family Farms (PRONAF), was launched to encourage ameliorations in small producers’ agriculture productivity.

In line with the Programme’s collective rationale, interested families were required to constitute associations of small farmers before applying for loans. Albeit within a restricted scale, various PCT associations were formed in the five participating states. An association’ main objective should be the acquisition of enough arable land to produce food to sustain groups of landless families. It was thus the association’s responsibility to choose a suitable property and negotiate the acquisition of it with its owner, since there was limited knowledge amidst individual families about the workings of the scheme. Once the land was selected and a price agreed upon, the formalised association should present a statement from the seller confirming their willingness to sell said property at the stated price to a designated land reform agency (state technical unit). The agency would essentially make an inquiry into whether legal issues existed that could obstruct the transaction and the price was within acceptable boundaries as indicated by local land markets.

With the approval of the state technical unit, the association would become eligible for immediate credit from a special fund operated by the Banco do Nordeste do Brasil (Bank of Northeast of Brazil). The bank would grant eligible associations a combined credit package for land purchase (SAT) and on-farm improvements (SIC).14 An allocation formula would define the amount able to afford land acquisition plus productive investments, based on the size of landholding and a budget for infrastructure requirements designed by each association. Nonetheless a credit ceiling for the package was established at an equivalent of U$11,200 per family. Given that associations of buyers would be allowed to collectively negotiate and, consequently, spare the price of large rural estates, each single plot was believed to demand a small capital outlay. The ceiling was therefore regarded sufficient to purchase a piece of land the size of a typical family farm, with the remaining money being able to meet productive investments, such as civil works, goods and agricultural equipments. In addition, each beneficiary family was entitled to a start-up subsidy of approximately U$440 for settling expenses.

The use of land as collateral was not made compulsory and some legal prerequisites that have normally been required for land funds were relaxed. The loans nonetheless had to be paid annually, under the penalty of losing the plot (NEAD, 2000). Following the purchase of the land, settlements would be created and the plots divided into family-farm units established by agreement amongst the beneficiaries. Association members in these settlements should decide upon payment responsibilities regarding the individual allotments. The formal deeds to property should at first be held collectively by association members, as the title would remain as collateral in case of defaulted debt payments. Simply put, individual titles would not be passed in the name of the families until the whole debt was redeemed.

At the same time, it was recognised that creating the infrastructure necessary to facilitate the sustainable operation of the family-farm system would be a costly process that demanded time, and for that reason complementary rural credit programmes were seen as paramount. Correspondingly, PRONAF was introduced contemporary with PCT to foster poverty-reducing activities through providing cash advance loans earmarked for family farms, particularly for use in pasture enrichment or the cultivation of permanent crops. The loans could also be used for contracting technical assistance following the view that specialised knowledge on farming could help minimise the risk of crop failure. Whilst the PRONAF programme was not at first projected to lay down large-scale agricultural enterprises, the scheme indeed allowed for start-up capitals and improvements on acquired plots. The loans were expected to help small farmers to successfully face competition in the agribusiness and, as a consequence, family-farm income should increase not only to cover living expenses but also generate a surplus for loan repayment. Access to PRONAF loans should be arranged collectively through cooperatives, although production might be individually organised by family-based producers. However, in order to boost the potential earnings from the loans, families had to be in farming long enough to understand the workings of the business and thus meet the programme’s requirements.

Undoubtedly, PCT associations were able not only to manage collective land transactions but also to raise land funds at favourable rates from banks due to their associative nature. This aspect of the Programme could be regarded a significant step forward, given the fact that landless workers outside PCT sites were being charged relatively higher interest rates by the rural credit bank, or were downright refused credit because of lack of land as collateral. However, a series of flaws soon became apparent involving the transactions taking place under the PCT rules. Given the asymmetry of information between landowners and the negotiating associations, the real price of the land was not immediately available to buyers to serve as a parameter for the negotiation. Furthermore, in view of the mentioned credit ceiling, the families turned out discouraged to acquire high-quality, expensive properties, insofar as the lower the price of the plot, the more they would save for post-purchase investments.

On the other hand, few landholders were interested in negotiating their properties at a price the associations were allowed to pay. In view of that, rural households who happened to be interested in buying better-quality properties had to pay a complementary value directly to the landowner, resulting that the prices reported to the technical unit were not necessarily the actual prices paid for the plots. More importantly, as will be discussed ahead in this work, a lack of plan-led strategies was observed in the market-based mechanisms that precluded the distribution of land reform settlements across the region in a more sustainable way. The net result of said limitations is that the Programme’s impact at a regional scale has been modest: according to the MDA, an estimated 551 transactions of land took place under the market-based schemes between 1997 and 2002, involving about 370,000 hectares of land, which resulted in the settlement of around 14,000 families until the Programme was terminated in February 2003.

Table 3.1 compares the economic performance of the rural sector across the Northeast states particularly with respect to selected farming indicators as well as the scope of land reform. Given the scale of the figures however, no patterns whatsoever can be discerned between states on the role of the reforms in the regional economy. In the next sections we will examine the extent to which the state-led (INCRA) and market-based (PCT) approaches to land reform have contributed to the growth of the regional economy. With panel data analyses and cross-section analyses, we will investigate the determinants of socioeconomic development in areas of the Brazilian Northeast where the approaches were adopted over the same period, both at the sub-regional and local level.

Table 3.1: Key indicators average growth rates (1995-2005) – Northeast states

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3.4 Capturing the socioeconomic impacts at the sub-regional level

In this section, we identify the effects of different indicators on the growth of the rural economy between 1995 and 2005 and then proceed to test the influence of PCT and INCRA schemes on that growth through panel data regressions. The analyses were made for 49 rural territories in the Northeast, as seen in Figure 3.2, of whom 22 have introduced the market-based approach.

Figure 3.2: Selected rural territories

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We performed multivariable linear regressions admitting 10 percent confidence bands. As apparently there were no plausible reasons for introducing the PCT in some territories before others, and for subsequently extending it to other territories within the five states, the non-random implementation timing is a basic assumption in the model with fixed effects. However, the chronological sequence in which the state-led approach took place in different territories was random. In other words, different geographical areas within territories were reached by the state-led policy at different moments in time. Simply allowing for sub-region-level fixed effects would not be capable of capturing the existing interaction amongst such differences. As a consequence, the possibility of overriding differences amongst these territories regarding unplanned expropriations of lands, something that appears to be the case in the Brazilian Northeast, offers a more reasonable interpretation of the outcomes of the INCRA approach. This problem is resolved in the model including random effects in the regression estimates.

To compare the effects on farming output of market-driven as compared to state-led land reform, we specified a dummy variable for territories reached by the PCT over the 6-year implementation period, taking the value of 1 for a territory or year of such type, and 0 otherwise. The extent of the state-led approach in the same time frame is represented by a variable that measures the proportion of areas expropriated by INCRA in each territory. This allows straightforward comparison between the sign and significance of land markets transactions for the growth of the farming GDP as compared to state-led interventions. As we used estimations over time, the regressions were tested for heteroskedasticity and corrected for it as required.

The variables used in the statistical estimations (Table 3.2) are based on the mainstream rural development literature (Haggblade et al, 1989; Ferreira, 2001; Gardner, 2003; Sahu et al, 2004). For instance, Gardner (2003) finds that agricultural output growth is a measure that originates from a production function that takes into account factors such as population increase (resulting in a larger farm workforce) additional cleared areas for cropping and investments.

Table 3.2: Panel data analyses variables

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Before discussing our findings regarding land reform determinants of rural GDP growth, some aspects of farming GDP in the Northeast are addressed that advocates for its use as dependent variable. At the sub-regional level, the rural countryside is characterised by varying degrees of access to adequate farming infrastructure and natural resources, resulting that some rural territories have higher prospects for socioeconomic upgrade than others. Also, due to different socioeconomic configurations, geographic features and agro-climatic conditions, these areas are expected to react in different ways to land reform policy.

The average farming GDP growth in the Northeast was 13%, whereas the sampled territories showed a 9% decrease in the PCT period (1997-2002). The descriptive statistics point to large variations between territories, with Medio Rio Doce being by far the worst regarding output growth. We also note a 0.77 deviation of production growth ratio from the mean, ranging between -0.95 and 1.72, which points towards goodly scope for betterments in crop and livestock output through a range of factors such as public spending in agriculture and natural resources, rural credit and farm-related investments. Table 3.3 summarises the regressions results.

Table 3.3: Determinants of farming GDP growth – rural territories

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Standard error in parentheses

* significant at 10%; ** significant at 5%; *** significant at 1%

As observed in the Table, coefficients of main variables are consistent with expectations. The economic effect of the cattle variable seems rather uncertain, although it renders the expected positive results for the random-effects model. This means that the importance of livestock grazing for the regional economy not only was unequal across the sampled territories, but was intensively impacted by the extent to which resources were dedicated to such activity over time. Large-scale, long-term investments such as for ranching are usually out of reach for land reform beneficiary families.

Factors directly associated to cropping are strongly significant for output changes. The logic here is quite simple: cropping in the Northeast is more likely to obtain higher yields in the short term than ranching. The variable is more significant in the fixed-effect equation because the size of the cultivated area varies more substantially from region to region than with time, whereby the coefficient slightly declines in the random effects model. The average growth of total cultivated area was also relatively low during that time period (9.7%). By comparison, the proportion of cropped area grew by more than 30% in the region, suggesting that levels of farming activity did not improve appreciably amongst the territories introducing the PCT. One way or the other, results in model 2 suggest that, over time, the effective utilisation of lands for farming activities can play an effective role in the economic growth. On the other hand, the size of the rural population plays a more influential role in the second model, as the rural workforce (and the number of consumers alike) increases over the years and is a function of the size of population in previous years. Moreover, increases in the rural population are estimated to positively influence the value of the GDP due to increased farming outputs in highly inhabited territories, particularly in rural territories located by the coastal zone.

There was over the PCT period higher access to rural credit for the commercialisation of family-farm produces. Yet notice that, as in anywhere else, production in land reform settlements has been highly sensitive to costs of transport. On the other hand, as a consequence of a lack of adequate infrastructure, particularly high-quality roads and railroads, the sales of settlers’ produces have generally been restricted to consumers in their own settlement or to close outside communities. Additionally, rural sector growth rates are inclined to respond more quickly to changes in the trading of highly profitable crops, whilst trading activities in settled areas rely on subsistence crops, all resulting that the variable for commercialisation loans goes in the opposite direction than the growth of the rural GDP.

As much as the negative sign of the coefficients for such loans might suggest that the level of production decreases with the probability of trading commodities, the fact is that the loans may have been directed to territories where farming output was increasing at a slower pace. Similarly, we note a correlation between higher levels of growth and lower levels of government spending in the form of expenditures for natural resources (piped water and irrigation, for instance) and energy. To the extent that, particularly for semi-arid areas of the Northeast, improved access to water resources has been a critical element of government strategies aiming at improving the regional economy, the negative coefficient suggests that those expenditures have not been destined to areas of higher incidence of economic growth.

It is also noteworthy the fact that the share of public funds allocated to the agricultural sector is not significantly associated with a rise in output. Whilst this result does not necessarily imply that the amounts were too small, it suggests that those resources may have reached areas other than the most productive ones. Moreover, a correlation between agriculture spending and a rise in the level of the settlements’ production could not be accurately estimated at a regional level, nor would the variable AGRISPEND be able to capture the effect of previous expenditures on the rural sector. In this respect, a time lag has to be considered between public spending and its impact on farming output, which is likely to vary from territory to territory. In addition, the projected outcomes seem to have followed different directions, since the coefficient for expenditures in natural resources turned negative (although not significantly), as opposed to agriculture spending.

On the flip side, our evidence suggests that higher farming outputs are likely to be associated with higher investment loans. That is, rural producers who afford investing in their land are likely to obtain higher yields. To illustrate the magnitude of the estimated coefficients, we notice that, compared to the level of government expenditures in natural resources or even agriculture – which is insignificant by any standard – the provision of loans for on-farm investments is much more likely to produce higher GDP increases. At the same time, the fact that agriculture spending seem to be less likely to affect GDP growth than public spending in natural resources implies that the availability of credit for rural producers has played an even more prominent part in improving on-farm production. On the other hand, since productive activities should be financed mostly out of participants’ reserves, land reform settlers could barely and rarely afford infrastructure improvements or advanced farming equipments.

Accordingly, factors admitted as responsible for the settlements’ unsatisfactory economic performance should include a combination of inefficient/insufficient government spending and consequently inadequate farming infrastructure. A few territories however, have not followed this pattern very clearly, particularly territories in the Atlantic Rainforest zone, a remarkably rich and fertile coastal area where consequently both public spending and the GDP from farming have often been higher than the regional average. By contrast, a lack of investments needed to reduce risk of crop failure due to drought in the driest territories had an adverse effect on the level of production in those areas. This is relevant to land reform strategies because, despite limited success of these reforms in the region, public investments in support of redistribution of land appear to be crucial for the economy of the region.

As Table 3.3 illustrates, however, results from different equations provide essentially identical results for PCT, indicating that the market-based transactions of land have not been good predictors of economic growth in the Northeast. An insight of the geographical distribution of the PCT sites signals that the Programme’s coverage was uneven at the sub-regional level, as illustrated by Figure 3.3. For instance, whilst the number of existing projects in Cocais reached 15 units, Vale do Mucuri was unlikely to exceed a single project.

Figure 3.3: PCT projects in selected rural territories

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Source: Brazilian Ministry of Agrarian Development (MDA)

Given that PCT pilots were by no means self-sufficient, higher investments would be needed to maximise both economic outputs and welfare. Although the fact that the PCT variable being a dummy prevents us from making accurate inferences on the actual impact of PCT settlements on rural production, we observe that the increase in the regional output that is associated with higher probability of land transactions is quantitatively small; compared to the ratio of land expropriations, the estimates on PCT are much more modest. It is worth noticing that some territories counting on higher tracts of cultivated land during the PCT period were characterised by a bigger GDP, but not necessarily as a result of the programme. Also, the per capita surplus derived from the farming sector has not perceptively risen with the presence of PCT, something that is endorsed empirically through the finding that the dummy’s coefficient is not significantly different from zero in any of the models.

The coefficient on INCRA is always negative and poorly correlated to the growth of farming output, although significant at 10% in the fixed effects equation. This does not necessarily indicate that the state-led approach was a factor running counter to economic growth, but rather that the growth was concentrated in areas other than INCRA sites. In other words, provided the ratio of expropriations is controlled for, the negative sign of the variable at a regional scale reflects that it is in areas outside the expropriated ones that economic outputs have grown at a faster pace. In the end, as in the market-driven approach, family farms resulting from state-controlled land reallocation have not found themselves in a position to compete with leading commercial farms in the agricultural market.

Land reform policy has been therefore unlikely to provide convincing explanations for the level of socioeconomic development in the region. On the other hand, we note from the analyses that the operation of other elements in the observed areas, especially a lack of public investments in infrastructure and hence the capacity of settlers to engage in large-scale farming, have ultimately prevented sites from positively contributing to the economic performance of rural territories. The legacy of such elements is that the socially desirable conditions remain obstructed that could put rural low-income communities into a self-sustaining development path.

Factors that might systematically increase rural families’ expectation of experiencing a rise or a decline in their standard of living through land reform are, to the extent that they affect their income, arguably more evident from a local perspective. Results from regressions with municipal-level observations are presented ahead.

3.5 Fine focusing the lens: land reform in the rural localities

Since it is more difficult to disaggregate the impact of market-based projects at the sub-regional level, particularly because the parallel expropriatory model has been running much longer in those territories, in this section we identify potential determinants of socioeconomic growth associated with land reform in a large sample of municipalities. The aim is to empirically investigate whether the analysed land reform strategies have promoted measurable socioeconomic changes in local rural areas. Some generalisations are derived from cross-section regressions. Table 3.4 shows that, as in the panel data regressions, the social and economic indicators are considered together with the analysed land reform predictors.

Table 3.4: Cross-section analyses variables

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The models’ main assumption is that land reform may have different impacts on the growth of economic and social indicators to the extent that different rural countryside areas differ from each other. One limitation of the following analyses is that, where the reform affects some rural parishes but not others creates a variation in the data that is random, or at least unconnected to the unobservable factors that might have influenced the outcome (Mitchell, 2005), which means that the explanatory power of the models is expected to be lower than for the panel data analyses. Nevertheless, since, the state-led land reform and the market-driven policy-making occurred over the same time interval, it is possible to distinguish the performances of the policies from regressing the dependent variables on the selected predictors.

An additional problem is that a lack of time series on various indicators per rural locality poses a particular difficulty in establishing empirical evidence related to the role of land reform in the local economy over time. Consequently, we concentrate on the estimation of changes in available cross-sectional data resulting from decennial censuses on households by the Brazilian Institute for Geography and Statistics (IBGE) that cover rural localities in the whole region with information on standard characteristics routinely considered in household surveys. Some missing value problems were addressed by determining that, at least with regard to crop data, a missing value generally meant that the actual value was near zero (for instance, most Northeast municipalities do not produce coffee at a large scale), hence bringing the total number of missing values down to an acceptable level. Obviously, due to data limitation together with methodological constraints on cross-sectional analyses, the following tests provide a partial view of the reform outcomes.

However, the role of the selected variables in the degree of socioeconomic growth has already been highlighted in the literature, most prominently agricultural activity, education, employment rate and public spending (Banya, 1989; Silva and Del Grossi, 2001; Fan et al, 2004; Ezcurra et al, 2007; Holloway et al, 2008). Table 3.5 provides the statistics for the variables used in the analyses. Results are reported for changes in economic (model 1) and social indicators (models 2 and 3) in this expanded sample of rural localities.

Table 3.5: Social and economic determinants of growth – rural localities

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Standard error in parentheses

* significant at 10%; ** significant at 5%; *** significant at 1%

Although there is evidence that production has been affected by the proportion of total areas effectively cultivated, the model shows that farming GDP grew only marginally in response to increases in the proportion of cropped land, which includes a high variety of crops. In land reform sites more specifically, the cultivation of coffee, beans, cassava and corn are amongst the most usual cropping activities (Heredia, 2006; Silveira, 2008). In the model, only beans and corn turned out highly significant, whereas for coffee the significance is much lower. For cassava, the effect did not reach the level of statistical significance mostly because this crop is more typical of subsistence agriculture. The regressions hence confirm that high-value crops like coffee have not been commonly produced in the Northeast at a large scale, particularly in areas of the semi-arid where the rainfall incidence is substandard. Lower-value crops like corn and beans are, in turn, typical of such places.

Accordingly, the indicator for rainfall incidence is somewhat significant and of the expected sign. In other words, output from countryside areas with relatively heavier summer rainfall is slightly higher than from drier areas. This is an indication that land reform settlements might perform best in areas where the agro-climatic characteristics favour family farming. On the other hand, proximity to a capital city is not estimated to have been a driving element behind socioeconomic development. However, given that it has been widely recognised in the literature that distance increases transport costs (for instance, Renkow et al, 2004; Holloway et al, 2008), the positive coefficient on farming GDP owned in the first equation suggests that, over time, the agricultural sector could perform best in benefiting the family-farm system of production by reducing distance to main consumer markets.

In addition, farming GDP barely grew in response to government spending. Whilst 60% of the sampled countryside areas increased expenditures in agriculture, only 33% showed an incremental expansion in rural GDP, which unveils that local governments might have spent either inefficiently or less than sufficiently in the rural sector. Likewise, the fact that the PRONAF variable is not significant in any of the models suggests that the observed increments to the provision of such loans to settled families have not enabled the family-farm system to improve regional indicators by a measurable rate. It is worth mentioning, however, that a great variation in the path of the reforms has been observed across the sampled areas which could have brought forth dissimilar economic effects, as when increases in the value of PRONAF loans per capita – used as a measure of on-farm investments – varied so much from one locality to another that family-farm production might have grown slowly in one area whilst at the same time increased much more quickly in another area.

It is also worth noting that, contrary to what was found for the sub-regional level where the state-led approach correlates negatively with output, the regressions for the local level suggest that, in the Northeast countryside, the economic effects of land expropriations have been negligible, as implied by the positive yet insignificant coefficient on INCRA. Any redistribution of land conforming to the market-free approach has not affected the growth of the rural sector perceptibly. Similarly, the market-based approach, represented by the PCT dummy, remains insignificant. Notwithstanding since the data do not provide information on crop output or cultivated area at the plot-level, we cannot estimate a production function to compute PCT settlements’ agricultural performance and directly compare it with state-led land reform producers.

Additionally, a study that merely compared the per capita GDP in localities reached by the schemes with those that have not been reached could not bring forth convincing evidence of the effect of the schemes on the situation of land reform settlers. To assess whether the scope of land reform can have a positive impact on socioeconomic indicators through other channels, we hence turn to the analysis of factors affecting rural families’ income, used hereby as a proxy for changes in their socioeconomic status. Differences across the sampled localities are pronounced for income growth. Per capita income rose by an impressive 4.94 in Unai whereas decreased (0.20) in Manga. An average 20% growth in the index of income inequality further exacerbated these disparities.

Model 2 provides correlations between income growth and likely predictors. Only three predictors are significant, amidst which one (literacy) is significant at the 10% level. In fact, this predictor goes in a direction opposite from what one would expect from an indicator that was supposed to increase income of rural families. The negative sign implies that, due to higher rates of employment in the rural sector, it became easier to find underpaid jobs in larger farms disregard of level of education. By the same token, having more years of study decreases the probability of a household to stick to those kinds of jobs. Illiterate households are more likely to work in the rural sector whilst higher educated ones would preferably engage in urban labour. Additionally, government cash transfers seem to favour the literacy rate – due to the Bolsa Familia and Bolsa Escola 15 – and the resulting increase in the average HDI.

As for the employment rate, 32% of rural dwellers were employed early in the decade in the Northeast, whereas 35% were so in 2000, although with appreciable inter-municipal variation (from 9% in Bento Fernandes to 61% in Riachao). Yet rural employment was amidst the strongest correlates with income increase. An approximate 0.33 R square in the model suggests that rural families supplemented their income with receipts from off-farm jobs or income support from the state. Moreover, as important as government aid might have been to increment rural income, judging by the statistical estimates it is not possible to determine whether that aid has eliminated settlers’ dependency on income from employment or self-employment in the non-farm sector. The same reason could apply to the fact that the ratio of agricultural spending per capita and PRONAF are statistically insignificant.

In so far as government’s spending in agriculture is expected to add to settlers’ capacity to bring forth goods and services on account of the multiplier effect, little attention was devoted to the provision of large-scale infrastructure in and around the settlements. As a result, the insufficient levels per capita of such spending have not ensued in reduced poverty or better living conditions, nor has the effect on income of differences in public spending from locality to locality become evident even when government aid is taken into consideration.

Notwithstanding that the supply of farm-related loans augmented over the PCT period, PRONAF incentives to agricultural productivity do not seem to have enabled the expansion of family-farm production to match demand at a regional scale. It was expected that settlers signing PRONAF contracts would have an incentive to undertake costly improvements on the land (as long as the expected yields from crops could be collected in the short to medium term, which is not always possible to predict due to the risks of drought and crop failure). However, bivariate correlations allowing straightforward comparison of PRONAF levels between the sampled rural localities show that the loans strongly correlates with PCT and the proportion of area cultivated with corn (Pearson correlation significant at the 0.01 level), indicating that loan beneficiaries used the money to produce a less profitable crop than coffee. It was thus found that the production of subsistence crops – but not for-profit crops – increased with the growth of PRONAF financing, but there is little evidence that such advancements contributed to increased living conditions.

The INCRA variable is highly significant for income growth. According to theory on property rights, the provision of land title can lead to economic growth (e.g. Miceli, 2003; Ho and Spoor, 2006). To the extent that the possibility of obtaining title through land expropriation leads squatters to invest in the occupied properties, one would clearly expect increased growth of income as a result of such expropriations. Enhancing such possibility could then, by augmenting the scope for investments, result in an income rise. This apparently supports the notion that poverty alleviation in the rural sector is highly sensitive to administrative land reform. As for the influence of land markets on income increase, it has been found that the PCT variable is statistically insignificant, whereby rendering the market-based scheme ineffective as a mainstay of settlers’ income in the region. Although the random character of land reform in the region hinders a more accurate comparison between the two approaches, the regressions indicate that higher incomes are more likely to occur as a result of INCRA than PCT. As will be discussed in more detail in next chapter, this pattern could possibly be ascribed to the fact that the net income of INCRA settlers should be higher than of PCT ones, since in practice the former do not have to service land loans, as opposed to the latter.

On the other hand, as an indirect indicator of settlers’ well-being, the ratio of per capita incomes may not be capable of capturing sweeping dissimilarities between different kinds of settlements in terms of access to basic human needs,16 from where results the problem of isolating the returns to settlers in the form of benefits that cannot be measured in economic terms, such as increases in standards of living concerning education, health and life expectancy. These patterns should be confirmed in the model testing for variations in the human development index (HDI). With an average of 1.21, changes in the human development index in our sample pose virtually the same ratio as the rest of the region (the Northeast’s increase is 1.22). However, this indicator varies between 1.43 in Santo Antonio do Retiro (territory of Alto Rio Pardo) and 1.07 in Santo Amaro do Maranhao (Lencois Maranhenses), implying in broad sub-regional discrepancies. Additionally, HDI increases are not necessarily in line with changes in income levels.

There are several variables predicting rural population’s standard of living in the PCT period. Government aid is insignificant, indicating that this variable either could not be observed at the regional level or that increasing conditional cash transfers did not figure high as a pro-growth policy before 2000. This latter possibility seems more plausible, given the fact that, as will be demonstrated later in this work, settlers remain dependent on the state for income. In addition to these predictors, elements related to education (years of study) and the distribution of income (Theil index) are as expected. The coefficient on literacy, which is negative for income, is positive for HDI, i.e., there is some indication that, within any given rural locality it is indeed households with higher education who are expected to obtain higher standards of living. Comparing this evidence to determinants of income (model 2) suggests that, even though changes in human development have been difficult to measure with the data available to this study, as discussed earlier, the indicator increased perceptibly in the decade, and arguably in a steadier manner than increment in income.

Finally, the selected land reform predictors are significant for HDI. Yet lack of satisfying results for PCT but quite reasonable results for INCRA as a predictor of higher HDI might owe to the fact that there are many more localities where the traditional INCRA approach prevails than localities in recept of PCT loans. In addition, Pearson correlations indicate that INCRA localities interact more with HDI indicators than with PCT-hosting localities. The precarious living conditions in PCT sites signal that their settlers are less likely to improve education and health indices than are households in INCRA settlements in the sample. On the other hand, due to clear limitations of the traditional mechanisms, particularly a lack of plan-led strategies characterising the absolute majority of expropriations, INCRA interventions failed to improve broader socioeconomic indicators in ways that were significantly superior to what was accomplished by PCT transactions. In fact, the estimates on INCRA indicate that the state-led approach had no more than a marginal impact on households’ welfare, perhaps again because considerably more rural parishes were reached by the INCRA scheme than the PCT.

In summary, the above empirical exercises unveil the limited influence of the reforms on the socioeconomic growth of the sampled localities. The expected welfare outcomes as a result of market-based schemes have not been confirmed, illustrating that securing land rights through the land market would not necessarily secure superior standards of living. On the other hand, the traditional state-controlled approach appears not to promote the level of on-site production needed to substantially reduce poverty and spur economic growth outside the redistributed areas. Coordinated plan-led efforts towards cutting down constraints to socioeconomic upgrade are, therefore, needed to foster higher economic growth associated with land reform schemes, thence improving the well-being of those concerned across the region.

3.6 Conclusions

This chapter covered the determinants of socioeconomic growth in the Brazilian Northeast, and the impacts on that growth of different approaches to land reform policy. This has been primarily an empirical study which seeks to test whether various schemes of allocating holdings to those who are landless have resulted in socioeconomic growth of a region, as many analyses in the literature are based on the assumption that increased security of tenure leads almost invariably to development. The study was dependent on what data were available and these covered a considerable range of factors. It has been found that both the market-based land transactions as well as the state-led expropriations render results that not only are barely significant statistically but also in line with our predictions. That is, none of the schemes seem to have yielded higher levels of farm output through increased access to title as predicted by the land titling theory, nor is there indication of settlers’ progressing from subsistence farming to for-profit activities that could be measured at the regional level.

On the other hand, the benefits of economic growth associated with promising welfare indicators have generally been observed in localities where a given degree of per household income has been obtained, so that possessing land is not the principal safety net. However, farming GDP itself does not seem to play a significant role because it is not economic growth as such that causes the HDI index to move up or down but the social status of the individuals taking advantage of growth and the conditions of their plots which foster it. Accordingly, it becomes apparent that economic growth per se has offered no guarantee that the standard of living of settled families will improve, especially because serious blockages in the Northeast’s rural economy have been observed which not only preclude the benefits of land reform to the under-privileged but actually result in greater misery for many countryside communities.

By comparison to the INCRA state-led approach, which seems to have to some extent impacted the lives of rural dwellers but not the level of GDP, the free-market approach does not appear to have clear pro-growth advantages. The fact that the variable for INCRA is significantly and positively correlated with rural income growth possibly owes to the larger number of settlers living and working in INCRA settlements than in PCT projects. This could signal that, rather than land market activity, it was the traditional administrative approach that drove the beneficial results in our sample. However, there is no empirical indication that the extent of land expropriations through INCRA has significantly improved the regional economy in the analysed timeframe, nor have the PCT-induced transactions of land. Where a relative increase in welfare indicators has been possible, factors associated with government aid to low-income people, such as foodstuff baskets and conditional cash transfer schemes, with the resulting amelioration of the status of beneficiaries, played a greater part.

We found, however, a pronounced positive effect whereby territories with more rural credit available for farming produced a higher GDP from the farming sector and vice versa (remarkably the coefficients are significant at the 1% level throughout). This clearly points to the notion that land reform – whether market-driven or state-controlled – without sufficient capital investments attached to it will not have a significant impact on the path of rural development. To the extent that the economic feasibility of land reform settlements is assessed based on such assumption, a lack of proper investment, public or private, is likely to lead to sub-optimal results in terms of family-farm activities. This could also have negative consequences for poverty alleviation purposes, a factor of critical importance for the development of the regional economy in the Northeast. The study thus indicates that amongst the factors limiting land reform settlements’ socioeconomic performance are insufficient farm-specific investment and lack of efficient plan-led mechanisms to allocate public resources toward achieving higher and socially inclusive growth in the rural sector.

To summarise, comparing the performance of INCRA expropriations to land transactions through PCT was of particular interest as to the extent to which the state should intervene in the land markets, permitting to implicitly investigate whether market-based land reform has been more pro-growth than state-led land reform. We found that, contrary to mainstream theoretical pressupositions about the effects of land title (Miceli et al, 2000; Miceli and Kieah, 2003), land markets do not necessarily produce better socioeconomic outcomes than traditional instruments of land redistribution. Taking these results together indicates that, disregard of a clear need for improvements, abandoning the scope for state-led land reform could have losses on both social and economic fronts whilst benefits associated with the market-based approach are still to be seen from a regional perspective. Conversely, a land reform allowing the landless poor to take full advantage of subsidised land transactions could actually contribute to improving access to land rights on a larger scale.

Some questions may thus be asked: what kind of approach to land reform is more beneficial to poverty reduction and the growth of the regional economy? What factors would contribute to the success (or failure) of such approach? Given our empirical results, we argue that answers to these questions will imply that factors leading to implementing a land reform strategy at the regional level will have to be identified. In the context of the Brazilian Northeast, we categorise these factors in two different levels: 1) factors related to the traditional state-led mechanisms of land reallocation, which include the identification of areas for land reallocation and public investments; and 2) factors associated with the market-assisted approach, which include attracting private capital in favour of the schemes. Once these factors are given full consideration, a greater number of settlers in the region will increase the probability of having higher income along with tenure security.

Thus, urgent efforts are needed to bridge a perceived gap concerning the roles of regional planning in land reform. Possible routes may include policy engineering that addresses: 1. land redistribution – geographic assignment of available pockets of land that constitute economies of scale; 2. socioeconomic evaluation of the profile of the landless population and the segmentation of funds according to geographic location, markets and worker skills; 3. institutional reorganisation that requires regional and local dynamics; 4. financial and legal agreements; 5. new structure of deeds; 6. financial incentives for landowners as well as higher involvement of stakeholders in developing land reform policy. At the outset, plan-led policy efforts will be required that combine positive aspects of both market-based and state-led approaches towards eliminating long-standing obstacles to the broader socioeconomic upgrade as a result of land reform in the Brazilian Northeast.

The evidence provided in this study contributes to the mainstream land reform literature, whilst bringing implications to the implementation of land reform policy in different ways. Firstly, our analyses demonstrate empirically that land markets do not necessarily work better than state-controlled reallocation of land to foster socioeconomic growth, and vice-versa. Secondly, it is implied that in order to produce a measurable impact on regional economic growth, it would be more appropriate to deal with land reallocation from a regional perspective, rather than choosing between models of land reform based exclusively on local-level considerations. As a policy implication, the study suggests that securing positive socio-economic impacts across the region requires a plan-led land reform that is coordinated at the regional level, for which the role of regional planning is central.


The Land Bill Programme: a baseline study of PCT settings

4.1 Introduction

As outlined in the first chapter, market-based schemes have been used, both internationally and in Brazil, to tackle the issue of land reform, with varying degrees of success or failure. Lessons therefore abound. For instance, in Kenya in the 1980s, land funds were strongly associated with land restitution and redistribution programmes, although the use of such funds was not followed by necessary support services (Hoogeveen and Kinsey, 2001). In 1995 land-related loans were made available to disadvantaged rural groups in South Africa to mitigate poverty and land concentration stemming from the apartheid regime, but the schemes were plagued with a series of coordination inefficiencies between governmental agencies (Brink et al, 2005). Colombia became in 1994 the first Latin American country to make an option for loans-based land reform policy focusing on transactions of land. It was also the first country to realise that high interest rates could lead to defaults in loan paybacks (Fajardo, 2002; Borras, 2005).

At the same time, part of the literature recognises a need for governments to act in tune with regional planning for a more efficient placement of land, which would require not only providing funds for land reallocations, but also designing plan-led actions that would benefit an entire region. For example, Marsden and colleagues (2004) urge governments to move away from a sectoral approach to land reform in direction to creating sub-regional policy networks. Dale (2000) believes that land reform schemes could be more effective with the use of decentralised planning processes, coupled with monitoring systems and coordination between government agencies. For Spencer (2007), governments should explore possibilities of central-local partnerships to provide infrastructure. Parnell (2004) focuses on the importance of developing organisational interfaces between political and administrative functions to fight poverty. Building institutional capacity to conciliate renewable natural resources with rural poverty mitigation is the penchant of scholars such as Alston et al (2000), Barrett et al (2005), and Ikejiofor (2005). In a few words, these and other studies support the creation of collaborative frameworks of policy and action intent on obtaining sustainable land reform results. This chapter brings to light some of the problems deriving from not systematically using regional planning as a strategic governance tool in land reform policy-making.

As seen in the previous chapter, a government initiative known as Land Bill Programme (PCT) was established in the mid-1990s to fight rural poverty associated with landlessness in the Brazilian Northeast. Like in many other countries, the Programme was designed to be a loans-based, market-oriented approach to land reform aimed at lowering the costs to poor landless households of obtaining productive land. The expected regional impact of the policy was a substantial decrease in the rural poverty rate in areas where the family-farm system prevailed. As we have previously seen, in any case, it remains disputed whether the market-based approach can be an effective substitute for the traditional expropriation mechanisms as a trigger of sustained socioeconomic growth in the region. With concrete examples from selected areas in recept of the loans, we argue that the factors explaining the meagre impact of the PCT programme are not restricted to the economic viability of each individual site, but includes lack of a suited space for plan-led conjunct actions as a means to propel broader regional development.

The following sections report the study of the quality of live in a sample of 11 municipalities hosting 13 land reform settlements, with fieldwork carried out between December 2008 and May 2009. Baseline evidence from a survey involving settlers and settlement leaders has been drawn together to identify the socioeconomic characteristics of the PCT population, as well as similarities and distinctions between settlements with respect to production, infrastructure and accessibility to basic goods and services. The purpose of the survey has been therefore to understand the extent to what settled families were positively affected by the Land Bill Programme and how this relates to the regional economy. The fieldwork was undertaken using both quantitative and qualitative research methods, as explained in detail in Chapter 1.

The methods involved surveying a representative sample of 260 rural households who received PCT loans in the period 1997-2002. Basically, the respondents were asked whether participating in the PCT programme resulted in a beneficial influence on their livelihood, specifically in terms of access to: (i) good quality land; (ii) basic services such as education and health facilities; (iii) adequate housing; (iv) enhanced ability to perform profitable activities; (v) higher household income. Insofar as the study’s main goal was to unpack critical elements that could explain the socioeconomic performance of the sites, some interviews were made with settlement leaders focusing more tightly on the settlements’ potential to carry out production (a) for the families’ subsistence, (b) for sale in the market, and (c) to generate a surplus for productive investments. The availability of hard and soft infrastructure was also addressed in the interviews in connection with its role in the overall performance of the sites. These interviews as well the questionnaires resulted in a series of relevant qualitative and quantitative findings,17 which are discussed in the subsequent sections.

The remainder of this chapter is organised as follows. Section 4.2 delineates a profile of the PCT population as well as the redistributed plots. Sections 4.3 and 4.4 then use the results from the surveys to identify both the status of economic activities on PCT settlements and the living standard of settled families. Section 4.5 provides a synthetic comparison of the results from the surveyed sites with broader regional indicators. Finally, section 4.6 presents our concluding remarks.

4.2 Access to land under the Land Bill Programme

For most of the rural communities in the Brazilian Northeast, land is the foremost means for securing a livelihood, as owning a plot of land could make households less dependant upon wage labour, thereby reducing their susceptibility to unemployment. Moreover, rural poverty and inequality in distribution of arable land have been closely linked in the region. In view of these facts, we hereafter analyse the impacts of the Land Bill Programme on settlers’ livelihood through a baseline study of selected areas of the Northeast, as presented in Table 4.1 ahead. These are areas that represent the multiple dimensions of the socioeconomic potential of the Brazilian Northeast. The settlements could be compared in several aspects allowing for a unique perspective on the socioeconomic status of PCT beneficiaries. Likewise, the location of the chosen settings in relation to roads, distance from them to market centres along with the availability of natural resources closely reflects the situation of PCT sites in the Northeast region as a whole.

Table 4.1: Sample of PCT settlements

Abbildung in dieser Leseprobe nicht enthalten

Source: 2008/2009 author’s on-site field work

Moreover, in selecting the sites it was taken into account that the Land Bill Programme was designed to be able to operate in similar manners in a diversity of geographic contexts. Consequently, our sample of sites comprised:

- Geographical areas with climate, soil types and vegetation representative of the majority of family-farm sites in the Northeast;
- A range of natural resources that include major rivers such as the Jequitinhonha River (in the semi-arid), the Barbosa River (transitional zone) and Una River (rainforest zone), with strong influence on cropping;
- A range of agricultural activities (for subsistence or profit) as well as livestock production that were also found in most areas of the region;
- Differences in access to infrastructure and services, as well as in distance to urban areas and key markets.

As depicted in Figure 4.1 below, our sample covers three main agro-climatic zones representative of the broader Northeast region. The semi-arid comprehends dry areas in the interior of the Northeast (known as the Sertao Nordestino), where natural resources are generally very scarce; the rainforest zone (Zona da Mata) comprises areas within the Atlantic rainforest along the east coast and close to capital cities, with in general better soil and rainfall conditions; and the transitional zones (Agreste and Mata de Cocais) between the rainforest zones and the semi-arid, where drought risk is moderate and native vegetation is less abundant. Besides, the Figure reflects a general tendency of PCT sites to be concentrated on (or close to) transitional or rainforest zones. In due course, the mix in the sample thus serves the purposes of comparing and analysing the extent to which the characteristics of a given area can be a component of consequence in a plan-led distribution of settlements under land reform schemes.

Figure 4.1: Agro-climatic zones and approximate location of sampled settlements

Abbildung in dieser Leseprobe nicht enthalten

The Land Bill Programme was designed to be complementary to the conventional INCRA instruments of land redistribution. As such, rural estates larger than 15 fiscal modules18 are subject to expropriation in compliance with Brazilian law and could not be negotiated according to the PCT framework. Actually, in the majority of instances the quotas distributed under the scheme wound up of a modest size, averaging approximately 26 hectares per family (the distribution is centralised at the median value of 24). The total average area in our sampled settlements’ was 1,014hectares, whereas the mean value for a plot was 34.4hectares. However, there were 290 plots out of 452 in which the size stood below the minimum value of 30 hectares as recommended by the National Institute of Colonisation and Agrarian Reform for the Northeast region (the smallest plot has 14hectares). Still, there were 162 plots with a surface area above the minimum value. These were settlements mainly located in the rural territories of Cocais, Mata Sul and Inhamuns Crateus. In sum, 64% of the plots in our sample had less than 30 hectares, which was below traditional INCRA standards for land redistribution in terms of sub-regional extent, showing that the mean size of a typical PCT plot is smaller than the surface area of an average family farm in the Northeast. In addition to that, just under 80% of the land could be put in agricultural use whereas the remaining unfarmed part should be left covered by native vegetation in compliance with an applicable Federal law requiring that legal reserves must be set aside for permanent preservation of native plant species and animals.

Notwithstanding plot size had little implication with regard to economic performance and the standard of living of settlers. Duas Barras, for example, was the smallest of the surveyed sites but, as we will see ahead, one of the most prosperous in many aspects. Other elements such as the quality of the plots, location and infrastructure should, therefore, be taken into account. Overall, the below average quality of properties acquired under the Programme could be explained by the following factors: 1) scarcity of arable land due to agro-climatic conditions, which constrained farm expansion; 2) the relatively small amount of money put into the transactions; 3) the fact that extensive tracts of land were already controlled by large commercial farmers not willing to sell their properties; 4) inability of institutional structures (land reform agencies and PCT associations alike) to attract high-quality land to the Programme; 5) lack of plan-led coordination between the federal government and regional and local units involving the selection of areas for the implementation of the policy.

With respect to number of households per site, we noticed that most settlements fall into two categories: those between 6 and 27 households and those with the total number of households ranging from 33 to 69 families. In average, PCT settlements in our sample accommodated 39 families, although the number ranges from 6 (Nossa Senhora de Fatima) to 69 (Fazenda Sao Geraldo). One of the problems entailing settlement extent, as mentioned above, was that small properties limited the number of families participating per site. In practise, the total number of families in a project bounded the size of the SAT/SIC package granted for land purchase and communal on-farm investments, thus restraining the scope of the Programme itself. We saw indications, however, that some PCT associations recruited a greater number of families as a means to become entitled to proportionately bigger funds. Since the maximum loans package per family, as mentioned earlier, was U$11,200 (plus U$440 for settling expenses), a higher value would have allowed for acquisition of greater areas, depending naturally upon the land’s price, or the amount necessary for farm-related investments. Table 4.2 provides insight into how the interviewed settlers assessed their allotment in terms of price and a range of other aspects.

Table 4.2: Settlers’ own assessment of purchased plots

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Source: 2008/2009 author’s on-site fieldwork

In terms of price paid for the plots, their location and size, the overall assessment was satisfactory, yet the most popular complaint was that the settlement was not adequate for farming, particularly in the sense that the land transfers were not attached to the means necessary to create surpluses that enabled households to upgrade their standard of life. A word must be said however on the way the plots were allocated, as some association headmen took advantage of the peasantry’s complete lack of bargaining experience to entice them into accepting low-price plots. This fact could be connected to some episodes of corruption and mismanagement of PCT funds involving transactions of land under the Programme. We estimate that 73% of the PCT beneficiaries we interviewed, which is equivalent to approximately 170 households, had very little or no participation in the land purchasing process, whilst only 19% played some part in the selection of the land. The reasons leading to this situation are complex yet mostly endogenous to the structure of governance of PCT, which left the task of negotiating directly with landowners almost entirely to the associations. The fact is that, by agreeing to pay lower prices for the land, the settlers were expecting higher economic returns (i.e. higher agricultural profits). In many cases, nevertheless, the plots purchased under such circumstances were actually unproductive property, whilst reasonably good lands turned out concentrated in the hands of leaders. This was always conducive to lower levels of production, due to an inequitable distribution of resources.

In some visited areas in the rainforest zones, a number of properties were brought to the land market for speculative purposes. That is, landholders produced an artificial scarcity of land whilst the demand for land due to the Programme was high, what contributed to inflate lands’ price. Rural properties in the semi-arid and transitional zones, on their turn, have been evaluated considering the availability of water under the surface soil or the property’s suitability to install irrigation systems. Particularly in the semi-arid, extensive tracts of unproductive land were put on sale at lower prices by landowners who were interested in getting some money out of the government’s Programme. Further, the possibility of land occupancy by members of the Landless Workers Movement (MST) – and the resulting expropriation by the state – actually reduced the attractiveness of many properties for investments in productive activities. An expansion in the supply of land was in fact observed in conflict-driven areas thus reducing its price. Nevertheless, according to a key informant at the Ministry of Agrarian Development (MDA), recent evaluations by local real estate experts in all five states showed that whilst it may be true that PCT transactions exerted some pressure on land prices in adjacent countryside areas, those transactions have not affected land markets at a regional scale, denoting that the Programme was limited in scope compared to the amount of lands expropriated in those states.

The Programme targeted rural workers, or at least people with some experience in farming. Additionally, the PCT leaned towards a category of heads of households who were unable to find a job in the agricultural sector, or because they did not have land of their own to cultivate and feed their family and migration to urban settings became a natural consequence. In order to verify whether settlers in our sample matches the government’s target population, we have traced a basic profile of the participants’ occupation prior to enrolling in the Programme, as well as their profile after enrolment, with results presented in Table 4.3. Knowledge of these aspects is essential to understand, in the analyses ahead, why some settlers expressed a positive view of their income status, in spite of poverty and slow socioeconomic growth on the sites.

The results in the Table demonstrate that programme beneficiaries within our surveyed area involved groups from different neighbouring and distant municipalities, from various walks of life and different levels of farming experience. However, a typical settler in our sample was one that had previously been a rural labourer working on a salary basis in some nearby location. As a matter of fact, most associations were created under the Programme with the expectation that the properties would be purchased in areas situated in proximity to beneficiaries’ home or at least in the same rural locality. This was a logical claim for the aspiring PCT beneficiaries because remaining in their place of origin would help preserve the social structure involving the rural populations, whilst preventing the relocation of families to remote areas. As much as these respondents expressed a preference for settings close to where they lived, it is worthwhile remarking that the prospect of receiving title probably played a more significant role in the decision to join the Programme than distance from their previous residence.

Table 4.3: Settlers’ basic profile

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Source: 2008/2009 author’s on-site fieldwork

Our evaluation of the sites showed that prior to joining the Programme a relatively small minority of beneficiary families already lived on the land. These were members of organised groups who had occupied the property and subsequently decided to join the Programme to receive title. Others previously lived in close countryside areas, whereas the larger group came from a neighbouring town. Another small category was constituted of former residents of more distant municipalities or even a different state. It was clear for that matter that some of the participants were willing to move over large distances for the sake of title. On the other hand, 34% said that joining the Programme was their own initiative, 43% said to have followed the advice of some relative or friend (their acquaintances were rural workers on the same location or close farms) and 21% said it was the result of their engagement in a social movement. By and large, there were two main reasons leading these people to apply for PCT funds: either because they became aware that there were almost no alternative options following the scarcity of work in nearby commercial farms, or otherwise because they believed the government would eventually expropriate the property and grant them the land title anyway without them having to pay off the loans.

Occupational status was another important factor analysed in our area based study. The vast majority of plots were distributed amongst individuals with some previous experience in rural activities. Very few respondents were acquainted with any sort of collective landownership (whether rural or urban). Some of them had quit farming due to age, health problems, debts owing to previous land credit programmes, or because of losses due to droughts and crop failures. We also found that almost 85% of the participating families had already worked on rural areas, 10% in urban areas and the remaining 5% were students, unemployed or had other occupations. These percentages refer to the last activity before entering the PCT, so we are not assuming that those who declared to perform urban activities had no qualification for agriculture. In summary, the majority of beneficiaries previously worked on rural areas, but a relevant part had more connections with close urban centres than with the rural ambiance. Moreover, as other studies have demonstrated (Silva and Del Grossi, 2001; Bergamasco and Norder, 2003; Leite et al, 2004), the population involved in land reform (market-led or not) has been heterogeneous and do not always fit in the category of poor rural population. In fact, some households acquired plots as a means to complement their income from work on other farms or in adjacent towns.

Whatever the case, these former urban workers or farmhands had become small producers on own land, growing field crops, and/or raising livestock or poultry, although most of them turned out practicing meagre subsistence farming. Indeed, the vast majority (92%) of those we interviewed indicated to carry out agriculture or livestock-related activities. For analytical purposes, we divided these individuals in two large groups: small farm-owners and non-owners workers. The first group (86%) was composed of full time self-employed rural producers that work on a family-farm basis – along with spouse and children – on their parcels of the distributed land, awaiting the final transfer of title. Individuals in the other group (6%) were rural labourers performing secondary tasks on someone else's land on a salary basis. A few occupations were nevertheless identified amidst sitting families other than just farming or ranching. These activities were generally referred to as bico (casual work or odd jobs) inside and outside the settlements. Moreover, our sample evidenced a small record (7%) of sitting beneficiaries who admitted performing some kind of urban activity, and some of these were students.

In general, respondents declared not being engaged in one of those peasant movements that can be traced to the numerous land invasions occurring in various parts of the Northeast throughout the last decades which involved landless workers, big farmers, and elements of the Landless Workers Movement (MST). Less than one-fifth of the settlers we interviewed admitted active involvement in these movements. They claimed instead that their demands are focused on better infrastructure for agricultural production, better schools and sanitary conditions for their family, and increasing personal income. This is a somewhat surprising result, as the region has a history of fierce opposition to the market-based approach from grass-roots movements backing traditional reform agendas in the area of land redistribution. However, many participants expressing their concerns about the Programme believed that becoming an MST activist could be a more effective tool to come into possession of good land.

It is worth mentioning that although quite a few of the respondents admitted openly to having a will to vacate the site in the future, that was more due to legal prohibitions against transferring the plots (and loan obligations attached to them) to someone else than their contentment with life in the project. Nevertheless, many PCT settings were found practically deserted by the time the field-based research took place.19 Almost half of settlers on Engenho Coepe, for instance, spent most of their time in an adjacent town named Sao Lourenco da Mata, where they had much easier access to public services, education and leisure. A quite similar story was told by one anonymous settler on Engenho Cana Verde,20 who disclosed that the president of the PCT association happened to own a house in town and would come to look over their plots during the weekends. Despite the government’s intent of settling people on land, the living patterns of beneficiaries in these areas remained commensurate with those of Zona da Mata’s rural workers who constantly commuted between old sugar mills and suburban areas of adjacent towns where they lived (Garcia, 2002).

Also on PCT Santo Amaro, families were less than optimistic that the Land Bill Programme would generate a lasting positive impact on their lives, and started a movement back to their original towns.

“We understand that the government wanted to help us, and provide the means to make this land a place of profit, but we don't have an option. We wish we could stay and work the land and sell our produce, because we are poor and have nothing”, said a settler in Santo Amaro.21

Landowners were unenthusiastic about the Programme as well, and some turned nervous in interviews when the issue of impending land invasions was discussed. They were straightforward uttering about the poor security of their properties and were apparently worried about it. This came as no surprise inasmuch as organised groups of squatters were invading large farms in surrounding areas with, in many cases, the support of left-wing political parties. An important fact to be noted is that not all the invaded properties fully met the legal criteria for land expropriation, i.e. large pockets of land at least 80% of which are in unproductive use. Notwithstanding, as aforementioned, these properties were not negotiated under the scheme since the owners saw little incentive to sell them. One landowner suggested that the Programme would be particularly useful if it led to the development of a greater area than just the immediate site area, because “in the future that would increase the value of my properties as well. If I only knew that would be the case I’d be happy to sell part of the property.” Another landowner perspective was that the impact of the Programme could be greater than just increasing lands’ value, having also a positive impact on the security of their property. “If the policy worked, we wouldn’t need to be afraid of land invasions anymore.”22

During the survey settlers were inquired about how essential possessing land is for them. Land rights were all-important not only for settlers’ prospects for wealth creation but also for serving as a means of recognition as members of the rural society. The proportion of these families who have a provisional title was predominant, representing 43% of the interviewed population. 21% declared having the definitive title already, whereas 34% of the survey respondents just did not know. Yet even the respondents who have title did not regard themselves as having a higher degree of tenure security than families that received land through expropriation mechanisms. Those who answered the questionnaires were also asked about the role of PCT in improving their situation. The dominant response (by 68% of those surveyed) was that just possessing a piece of land was not enough to make their lives better (only four percent answered that their lives became much better) with perhaps as many pointing out that they found themselves forced to look for jobs in nearby towns due to inadequate infrastructure and sometimes scarcity of natural resources in the settlements.

By the same token, beneficiary failure to upgrade their condition (and ultimate desertion) could indeed be associated to a lack of financial sustainability in many settlements, that is, insufficient resources to invest in infrastructure and productive activities. In the next section we will address the relationship between level of production and quality of life in PCT sites.

4.3 Agriculture and livestock production on PCT settlements

According to the PCT framework, settlers’ associations that successfully completed a land transaction with SAT funds would become qualified to apply for complementary SIC start-up loans, in order to establish the settlement and initiate production. Whilst SIC funding was not enough to take forward an autonomous agricultural undertaking, PRONAF financing was an additional credit line accessible to beneficiaries that worked on a family farm regime.23 Prospect SIC and PRONAF beneficiaries should draw up proposals for productive investments on the purchased plots (basic services, infrastructure and inputs) and submit them to a state land agency, including an outline of their demands for technical assistance and specialised training tailored according to the settlement’s productive activities.

These second-round funds should primarily be committed to preparing the land and amplifying the fields for cultivation of perennial crops, as well as for improvements in livestock production. In addition, up to eight percent of the SIC loans could have been utilised for technical assistance. Part of the funds could also be used to build basic infrastructure and agro-processing facilities, as well as for the purchase of farm vehicles for communal use. The status of production activities we found on the surveyed sites, however, did not reflect the Programme’s goals, as indicated in Table 4.4.

A prominent aspect to be stressed in our study, however, is that the bulk of acquired plots (about 60%) were only partly cultivated. Not more than 20% were cultivated in an intensive manner, and almost 20% of the plots were not in use. Little mechanisation of vegetable crops was observed and, except for a few agricultural items, on-site cropping did not imply economies of scale. The prevailing activity was restricted to subsistence crops including the cultivation of tropical fruits and vegetables. With an eye toward what the settlers’ family would need during the coming few months, commercial farming occupied a small part of their activities. In general, agricultural production was carried out in tandem with raising animals (chicken, pigs, cattle and goats) for food and, exceptionally, profit. This evidence is consistent with the intense risk of draught in the areas. That is, granting that there would be enough forage for the animals, the activity presented lower risk than planting vegetable crops. However, grazing and ranching were also for the families’ subsistence, counting on small herds of cattle, goats, donkeys or mules.

Table 4.4: Composition of PCT settlers’ farming activities

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Sources: Ministry of Agrarian Development and 2008/2009 author’s on-site fieldwork

Also, the SIC/SAT package could not afford capital infrastructure improvements due to an upper limit of US$11,200 per beneficiary. Start-up expenses were to be capped” at that ceiling value as well, and just covered expenses incurred in preparatory arrangements, such as clearing livestock fields or building fences plus an initial set of supplies for production. Since they were operating with little to no surplus to accommodate economies of scale, there was less than sufficient investment by households from their own income and (according to the table above) about half of the families applied for PRONAF funding. However, PRONAF loans were also limited due to the families’ low capacity to accommodate extra loan obligations in their budget. As a result, these funds were focused on the purchase of basic items of infrastructure and some hands-on technical assistance in order to overcome, to a certain degree, the limitations of the Programme’s loan package.

In reality, settlers in our sample blamed the insufficiency of technical assistance coordinated by state land agencies for the difficulties they were going through, and many found that some sort of training would have been a decisive factor, particularly because in the stunning majority of instances they had never lived or worked on a land reform settlement. The service was undoubtedly rare (46%) or wholly absent (54%), yet their inability to cope with large-scale farming was also connected to the fact of them not being farmers at the time of joining the Programme, albeit being part of a rural population that had undertaken services in a farm. It should be noted that very few PCT associations used the funds to establish agriculture cooperatives of small producers that might have enabled collective undertakings involving production and opportunities to sell their produces (as seen from the Table, less than one-fourth of settlers were able to produce collectively).

This was the case in Duas Barras, Fazenda Dois Bracos and Fazenda Sao Geraldo, where establishing cooperatives benefited agricultural activities on the sites in a number of ways. A headman interviewed in Duas Barras, for instance, argued that family farms were too small (17 hectares in average) to justify the acquisition of a tractor or any other type of heavy farm machinery for use on a single plot. According to him, amounts of land larger than a 17ha plot were required for paths and roads since the settlement’s physical access was in critical condition adding to the time needed to get to markets. He added that individual settlers on the site did not possess the means of transportation indispensable for delivering their produce even into Padre Paraiso (the nearest town) and their plots were insufficiently mechanised. “The cooperative provided cheap solutions to our problems here on the settlement”, said the interviewee.24

The supply of inputs which agricultural activity require in the form of vegetable seeds or seedlings was available in different amounts across the visited settings, although the majority of settlers used part of their start-up funds to buy seeds. Fertilisers, pesticides and other agricultural chemicals, as well as farming apparatuses and machinery, were being used without technical support. Mechanised self-cultivation was nearly absent, providing further indication of the unfeasibility of the settlements for large-scale agriculture. Similarly, the minority (32%) of settlements had tractors or other motor vehicles suitable for farming applications, so they deployed workable animals as mules and oxen to do the hard tasks. Irrigation supplies were also precarious or completely neglected in the majority of settlements. Agribusiness in the visited sites was thus distinguished by slow technological advancements.

Features such as road accessibility and proximity to a marketplace were seen as preconditions for the commercialisation of produces. Notwithstanding physical access was, as a rule, so precarious in many sites that row crop tractors would sometimes be used to transport harvested crops to town markets in the rainy season. Table 4.5 allows insights into the quality of main roads serving the sites in our sample. The table includes only roads with some accessibility by settlers established in the area. As suggested from the table, the dubious condition of these roads imposed constraints to growth in the settlements settlers due to high costs of transport.

Distance was also seen as a physical exclusion barrier for the overriding majority of families we interviewed. All sites in the sample were rural, with perhaps the sole exception of Engenho Cana Verde, whose short distance from Barra de Gauabiraba’s city centre (less than 5km) may assign it the category of peri-urban. According to Table 4.6 ahead, only about one-third of the settlements were simultaneously situated within a short distance of marketplaces and counting on roads of acceptable quality (up to an hour ride on paved or partially paved roads). PCT Engenho Coepe, despite being situated in the rich Atlantic Rainforest zone, was by far the worst-case scenario. An interviewee in that settlement reported that transportation costs absorbed an astounding 80 percent of the settlers’ revenue from agriculture.25 Undoubtedly, the commercialisation of PCT produces faced serious impediments as a result of the difficulties highlighted above, with the few exceptions of settlements cultivating higher-value crops, such as coffee in Duas Barras and Fazenda Sao Geraldo. At least in these two cases, the perceived strategy was to use the agricultural profits to expand and consolidate production activities according to the characteristics of their allotments.

Table 4.5: Quality of main roads in the sampled areas

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Source: Brazilian Transports Confederation (CNT).

To summarise, with quite a few exceptions, the PCT settlements we visited had the following aspects in common: the associations did not manage to establish a strategy: (i) to increase on-farm production beyond the subsistence level; (ii) to generate enough surpluses to secure productive investments;26 and (iii) to consolidate the family farm system as a successful mechanism for poverty alleviation. The following table provides a synopsis of the productive activities in our sample of sites. Taking a rather cautious approach to avoid underestimating the potentialities of the market-driven scheme, it can be argued that further economic activity needed be generated within the settlements that could result in adequacy of income, thus adding to the socioeconomic status of sitting families, as assessed in the next section.

Table 4.6: Characteristics of settlement production in the sample

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Source: 2008/2009 author’s on-site fieldwork

4.4 The standard of living of PCT beneficiaries

The Land Bill Programme sought to bring down the very high incidence of rural poverty in the Northeast mainly by raising the incomes of nearly 15,000 disadvantaged families who were formerly deprived of land or with insufficient land to secure a livelihood. Upon completion of the land purchase process and as a condition to become eligible to get post-purchase funds, PCT associations had to draw up small infrastructure sub-projects within a broad range of civil services such as housing, electricity, water supply installation, schools and health posts, or repair services in secondary roads and bridges, once these items were regarded indispensable for settlers’ activities and well-being. However, as discussed in the precedent sections, limited access to natural resources, infrastructure and productive investments, coupled with the virtual absence of a plan-led strategy were central factors contributing to slow socioeconomic growth on PCT sites.

Our study of the selected sites revealed outstanding deficiencies associated to inadequate infrastructure and inferior service provision. For instance, the survey captured information concerning the supply of water. Particularly for families settled in the semi-arid, agro-climatic conditions were not favourable to agriculture, as renewable resources were scanty and the areas were highly vulnerable to drought. Obtaining potable water was, consequently, a major challenge. The majority of families had no tap water in their dwellings and took water from water carriers (trucks) or a public well. Without doubt, in settlements located closest to the town there was water supply through house connections. Yet sometimes this water was only made available for a few hours during the day or just a couple of days per week. Settled families were not able to permanently reach treated water as a matter of course, thus resorting to unreliable sources to fetch water. It should be stressed that only a minority of families in our sample received treated water on an uninterrupted basis, nonetheless, and there was over the interviews an insistence that the government should improve access to water for agriculture and residential consumption.

We also inquired settlers regarding the quality of sanitation facilities and waste disposal. Not all PCT beneficiaries had flush toilets facilities inside dwelling and many used pit latrines or outside toilets. There were communal refuse dumps in some sites, yet even in these few cases the existing rubbish removal service was of very low quality (rubbish was collected by local authority less than once a week). The quality of on-site health premises was equally unacceptable or inexistent. Figures 4.2 to 4.4 give the proportions of additional basic services as well as household items that reflect the condition of the PCT families. It must be emphasised that the items presented in the Graphs are not exhaustive; some have been omitted because they were not indispensable to our evaluation of the sites.

Figure 4.2: Housing types

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Source: 2008/2009 author’s on-site fieldwork

Figure 4.3: Source of indoor illumination

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Source: 2008/2009 author’s on-site fieldwork

Figure 4.4: Home appliances

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Source: 2008/2009 author’s on-site fieldwork

As for access to schooling, having become a PCT beneficiary does not seem to make a difference. Difficulties were observed involving sending kids to school not only in terms of distance and mode of transport (which were a challenge for families on low incomes) but also the expenses incurred (school fees, uniforms, books and the like). The result was that the level of education in our sample of PCT beneficiaries was strikingly low. Amidst the adults, the outright majority of respondents remained illiterate or semi-literate. The number of respondents who were downright illiterate was 110 out of 233, representing approximately 53% of the respondents. If we added households who could only read and write (14 respondents, which represents 7%) we would have a contingent of 124 respondents, representing 60% of the total. A less numerous group (21%) attended elementary school (1st to 4th grade). The third category of respondents was composed of those who attended either fundamental or high school (16%). Only one respondent had higher education.

From another viewpoint, family income was in our statistical analysis the main parameter for evaluating the well-being of land reform beneficiaries. One survey per sampled household was conducted to collect background information on their financial situation (see Table 4.7), and we observed little variation in average household income for our population of 260 PCT beneficiaries.

Table 4.7: Settlers’ income and economic situation

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Source: 2008/2009 author’s on-site fieldwork

For the sites surveyed, the break-down of settlers’ income was exceedingly difficult to estimate, in any case, since the families did not have a record specifying all sorts of income earned by family members. In addition, an increasing number of household heads were engaging in more than one activity. Some were working part-time on someone else’s farm regularly, or were hired only for seasonal work, e.g. for harvesting in the end of the growing season. Others were subject to long hours of underpaid labour on the emergency fronts (a drought-relief programme that involves digging water reservoirs). Whilst working on their own allotment, settlers devoted more time and effort to agriculture production than to livestock production. Even so they were not entirely independent from off-site occupations.

Notwithstanding settlers were quick to attribute a small proportion of their low incomes to crop production.27 By contrast, almost half (43% to 52%) of the amount of families’ income was originated from work outside the settlement. The per capita monetary income ranged from US$60 per month in the driest territories to US$130 in the potentially wealthier areas, like the Zona da Mata or the Sao Francisco river basin. Even if their total earnings were considered (that is, self-employment profits plus salaries from farm and off-farm occupations), the amount per capita had a mean value below the national minimum wage (about US$175, as of December 2008). Net of loan payment, the total family income accruing from all these activities varied between 2.5 and 3 minimum wages, depending on the setting’s location and number of paid family members.

One should also consider as a substantial part of sitting families’ income the foodstuff baskets they received from the government’s welfare programmes, or aid consisting of a monthly monetary payment. These are cash transfer schemes created to promote the basic well-being of families in need, particularly individuals living in areas characterised by longstanding deprivation associated to a highly skewed land ownership (Soares et al, 2006). In many cases, the provision of subsistence goods was combined with conditional government schemes, for instance, the Bolsa Familia (Family Voucher programme) for which eligible families had to fulfil a number of conditions including sending kids to school regularly, as well as taking medical examinations and vaccination. Families passing the criteria were given magnetic cards for cash withdrawal, with benefits of roughly US$80 a month. The concentration of welfare programmes in the Northeast follows the region’s low incomes, high poverty rate and scarcity of productive resources, especially because the region is susceptible to severe droughts. 67% of our surveyed families were identified as welfare programme beneficiaries.

When these factors are taken into consideration, it becomes easier to understand why almost 80% of the respondents faced difficulties meeting their loan repayment obligations. At the time they contracted the loans, the terms for repayment were 20 years with up to three years’ grace at a yearly interest rate of 6%. Loan recipients living in harsh agro-climatic areas were granted a 50% reduction on that rate in case of anticipation of payment. The burden on participants’ budget caused by loan obligations was believed to diminish over time, as the expected farming outputs raised the settlers’ earnings relative to the constant flow of required repayments. In other words, it was taken for granted that the loans would secure economic feasibility for the family-farm system. Our study indicates, however, that PCT settlers had little ability to generate income to simultaneously service loan liabilities and secure their livelihoods, let alone save cash for production enhancements.

Whilst municipal governments were officially in charge of providing public education and health facilities on the settlements, they were focused on addressing basic needs of their rural communities generally speaking, resulting that some of those services were only accessible by sitting households that happened to live in proximity to urban centres. Some headmen argued that the settlement was being deliberately neglected by authorities simply because reform beneficiaries were seen as vulnerable minorities without a political voice in the area. Those who felt socially excluded were to a large extent the same groups who experienced exclusion from public services as a consequence of remoteness.

In any event, insufficiency of public resources with respect to large-scale infrastructure benefiting settlements is suggested to be part of the barrier to higher levels of production, together with higher family incomes and more promising socioeconomic prospects for settlers living in deprived circumstances. In Table 4.8 we observe differences across our sampled sites in terms of on-site infrastructure and accessibility to basic goods and services.

Table 4.8: On-site infrastructure in selected PCT settlements

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Source: 2008/2009 author’s on-site fieldwork

4.5 The surveyed sites vis-à-vis the regional economy

In this section, we compare socioeconomic indicators from our sampled areas with indicators at the sub-regional level and the Northeast. As discussed at length previously, despite the use of mixed farming featuring livestock and agriculture, the emphasis within PCT settings is laid on crop planting. The graphs in Figures 4.5 and 4.6 show the extension of crop production in our surveyed area over an 11-year span, being 2000 a probable year when the local and regional economy should start experiencing the effects of agricultural activity on the sites.

A fall is observed in most indicators for PCT municipalities, which somewhat coincides with years of severe droughts in the region beginning in 1997 and continuing until approximately 2001. In spite of the fact that cassava is the main agricultural product amongst PCT settlements, the unchanged pattern of its curve after 1997 gives little indication of the sites’ contribution to the growth of the local rural economy. Still, the graphs are compatible with the status of cassava cropping as a subsistence activity amongst settlers, as the total area devoted to it is in average no more than one third of that for other crop types suitable for the family farm system.

The continuous line in both Figures for coffee is indicative of the higher sustainability of this crop type in the rural economy. The cropping of coffee for commercialisation is a typical large-farm activity in the Northeast given the technologically advanced methods (and higher long-term investments) required to carry it out, so that small producers are in general devoted to cultivating other crops. Consequently, coffee fields comprise a smaller share of the total area including in the Northeast aggregates. In addition, the areas devoted to coffee in the chosen PCT municipalities are for the most part a result of agricultural activity in major commercial farms. Corn cropping, on the other hand, is a common activity amongst the myriad of small producers in the region, with total outputs exceeding all other crop categories.

Figure 4.5: Hectares of selected crops in a sample of PCT municipalities

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Figure 4.6: Hectares of selected crops in the Northeast

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Undoubtedly, farm production in host municipalities did not improve considerably in the years following the adoption of the Programme, and in all relevant aspects they performed worse in average than the rest of the Northeast. These results by and large fit the fact that the reforms have not evoked productive investments benefiting the redistributed areas through targeted policies concerned with designing and placing infrastructure or other pro-growth activities in the agricultural sector. Figures 4.7 and 4.8 compare changes over time in living standards and other relevant social indicators.

The quality of life of PCT beneficiaries in our sample serves as the basis for the analysis of how the Programme contributed to social inclusion and economic growth in the case study area. However, it is not yet clear whether the standard of living amongst the small PCT population had an impact in the overall indicators of their host municipalities. Even if there were a pattern by means of which one could determine that, as a result of the Programme, the ratio of access to land’s rights in the sampled municipalities matched the overall situation in the Northeast (as seen in Figure 4.7), one would have to admit, by the same token, that the sites clearly lagged behind the region’s average as relative to improvements in the availability of basic goods and services. This is consonant with our claim that the redistribution of land was not followed by a plan-led strategy to provide supporting infrastructure.

Figure 4.7: Land ownership and access to public services

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Figure 4.8: Employment, income and human development

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It is implied from Figure 4.8 that the expectation of the scheme to reduce rural unemployment was apparently met through establishing small producers in the areas. However, the rural income rise per capita in these areas does not correspond to the rise seen for the whole Northeast, signalling that income from farm activities on PCT settlements did not increase more than in other parts of the region. On the other hand, the total per capita income that includes sources of income other than rural wage labour varied a lot across our study area and the region alike.

Evidence is provided that the growth rate of standard of living in rural areas is associated with proximity to urban centres, however. For instance, although our sampled municipalities are still poor by national standards, they rank reasonably well on the Human Development Index (0.62 in average) as compared to the rest of the Northeast (0.52).28 The gross students’ enrolment rate is 0.75 in average, and the literacy rate for the adult population (older than 15 years of age) is low: 65%. Likewise, the education component of the Index (HDI-education) increased at a higher rate in our sample than in the entire region. As for the HDI-health, the index is also higher in these municipalities due to the presence of health clinics and public as well as private hospitals (life expectancy is 67 years, according to the Ministry of Health SUS system), which gives a reasonable proportion of physicians and nurses per 1,000 people. As a consequence, regardless of disparities in income growth, improvements in the access to public services are quite the same at both levels of analysis.

Figure 4.9 ahead compares selected economic indicators considering two different periods: 1995-2000 (period 1), covering the years of implementation of the Programme and the emergence of any measurable results on the rural economy, and 2001-2005 (period 2), with a longer lead time and the eventual consolidation of those results.

Figure 4.9: Selected economic indicators in the sample – Growth rates

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At the level of the municipalities, the proportion of cultivated area increased significantly in the years coinciding with – and possibly owing to – the arrival of the market-based model. Nonetheless, this remarkable ratio of tilled area was followed by a much less promising growth rate of crop output, even when the lead-time element is taken into account (period 2001-2005). Moreover, production of the selected crops (cassava, beans, corn and coffee) grew less in our sample than in the broader regional context, which comprises production in areas not reached by the scheme.

As a matter of fact, combining investments in agriculture with supplying fundamental services and facilities for the community was outside the possibilities of settlers in our sample. Consequently, PRONAF post-purchase funds were not enough to increase family farm productivity– probably the most serious disadvantage PCT beneficiaries faced in the agricultural business. In quite few cases, rural cooperatives were organised with the support of PRONAF and an improvement was effectively seen in their production and commercialisation capacity, especially through mechanisation and organisation of joint farming activities. In the majority of cases however, a lack of investments in areas devoted to cultivation of crops was a central factor contributing to low levels of production. Additionally, the local-level variation of GDP from farming actually decreases as farm activities in PCT settlements moves into the period of expected consolidation, as opposed to the steady rate of GDP growth for the region and territories. Such observations are consistent with the humble contribution of on-site subsistence farming to the economy of the region.

The 1995-2000 rise in government spending was likely to influence the GDP growth positively at all levels of analysis, mostly by creating benefits for the productive sectors of the regional economy. To the extent that this is true, the farming sector in the region should have derived utility from the rise in public expenditures, in terms of a higher demand or increased consumption of rural outputs. From Figure 4.9 alone, nevertheless, it is not possible to determine whether increases in public expenditures necessarily generated increases in economic activity. Although local spending in agriculture seems to have influenced the pre-2000 growth path for cultivated area and farming GDP, such expenditures do not look like having any relationship with improvements in crop output.

Likewise, the apparent increase in crops could hardly be attributed to roads and transport spending. As mentioned before, the precarious condition of most roads and highways serving the visited sites is a weighty impediment to income growth in the short term by not allowing settlers to sell their produces at large scale. Additionally, the majority of PCT settlements are separated by remarkable distance from important market centres, resulting that the difficulties involving the interchange of goods and services between sites and potential consumers markets across the region have not been easy to overcome. In spite of that, the bulk of public outlays were destined to improve transportation systems in urban centres instead, whereas the 2001-2005 figures demonstrate a fall in the proportion of local roads spending (construction and repair works).

Increments to all sorts of public spending were lower in period 1 than in period 2, with the sole exception of agriculture expenditures at the broader regional level. It is noteworthy that the step-down of expenditures was, in the main, a result of the fiscal constraints imposed on states and municipalities’ by the 2000 Fiscal Responsibility Law (Melo et al, 2010). Accordingly, in spite of the fact that rural outputs were higher in some sites as compared to others, including production in family farms and small rural producers, this was more a result of higher agricultural productivity due to availability of water resources, in conjunction with better infrastructure and closer proximity to marketplaces. At least one thing is for certain: changes levels of public outlays in the farming sector were not necessarily the cause of perceptible changes in the growth of crop yields.

Yet access to rural credit through PCT (including the PRONAF credit line) was expected to significantly enhance settlements’ yields through family farm production, irrespective of further spending of public resources on the sites. However, as seen from the Figure, availability of rural credit was higher in period 2, implying that the introduction of the Land Bill Programme did not necessarily induce significant increases in on-site investments. Conversely, the effects of increased rural credit in period 2 seemed to have an influence of increases in crop production. Finally, although higher crop revenues were noticed in PCT sites where not only rural credit was promptly available, but also where location and economic conditions were more favourable, the predicted benefits of the Programme could not be ascertained from a regional perspective.

4.6 Conclusions

Traditional land reforms in Brazil have been intended for combating poverty by redistributing land through land expropriation irrespective of the economic viability of the sites. As opposed to the state-led model, the PCT market-oriented approach made an attempt to address those twin issues by stimulating land transactions through the provision of land loans. As results from our case study demonstrated, the Programme succeeded concerning providing easier, less conflictive access to property rights than has been the case with the expropriation-based model. Notwithstanding the schemes suffered from infrastructure flaws and a lack of plan-led efforts at the local and regional scales, resulting that family-farm production was generally marginal and failed to impact significantly settlers’ welfare.

By and large, the quantitative data of Chapter 3 were consistent with the data from our sample. The combination of on-site information and survey data showed the predominance of subsistence agriculture in the majority of sites, as a minuscule part of settlers’ income was destined to improving production. Conversely, most settlers had to commit a substantial part of their income on subsistence items, in many cases putting pressure on local/state government to provide foodstuff baskets or other basic living supplies. Consequently, about 60% of the families we interviewed sustained that their income status remained the same as prior to joining the PCT, or even worse. Also, the majority of households in the remaining group (that is, those who considered themselves better off) were recipients of government-issued aid, so that a perceived rise in their income was not necessarily a result of activities on the site. These facts constitute indications that the quality of life did not improve for loans recipients in the way predicted by preliminary evaluations of settlements (e.g. NEAD, 2000). Instead, our survey evidence largely replicates the findings of Heredia et al (2002) from a broad sample of INCRA settlements created prior to 1997, as referred to in Chapter 1.

As a matter of fact, the unfavourable situation within PCT settlements was a function of a variety of complex factors, and the level of productive investments was just one of them. A shortage of natural resources was apparently imposing restrictions on agricultural production, and this fact caused a bottleneck to the social inclusion of sitting families as well. On the other hand, production in some settlements was able to generate surpluses that were relevant to support households’ decisions to stay and further invest in the land. The viability of these projects relied to a large extent on the combination of two main factors: the presence of natural resources and/or adequate infrastructure to overcome unfavourable agro-climatic circumstances and higher accessibility to the marketplace. Consequently, loan beneficiaries in these sites had more incentives or the financial capacity to invest and organise collectively to drive production towards commercialisation.

It became manifest in our study that the loans-based scheme, by itself, was not a sustainable solution to the issue of rural deprivation amongst the landless population for at least four main reasons: 1) the amount of loans at the beneficiaries’ disposal was not sufficient to consolidate viable agriculture enterprises based on the family-farm system across areas of concentrated deprivation; 2) in average, settled families’ income turned out below the minimum necessary to perform pro-growth investments in their land; 3) this was particularly true for settlers in areas requiring substantial investment to face insufficient natural resources and inadequate infrastructure; and, perhaps more significantly, 4) the implementation of the Programme lacked coordinated strategies to attract good land and, ultimately, promote the growth of the regional economy. As a result, official data do not point toward better socioeconomic indicators in these areas than in other areas of the Northeast during the PCT period, suggesting that the Programme has not managed to inhibit the growth of rural landlessness and poverty, problems that interact with each other in the region. Clearly, more effective solutions are needed.

The aforesaid elements made incurring loan obligations barely rewarding for the striking majority of families, resulting in negative implications on the extent to which the Land Bill Programme served its poverty alleviation intents. An aspect of uttermost relevance for the assessment of the Programme is thus that the level of profits plus consumption of own produced goods were not sufficient to lift the vast majority of families out of the poverty line. Yet as mentioned before, this condition of poverty is not so much a matter affecting the PCT population but a characteristic featured in the rural territories of Programme implementation. As a natural consequence of the scarcity of natural resources in the semi-arid, the majority of PCT projects turned out implemented in rainforest or transitional zones, and the scheme did not manage to establish a more homogenous spatial distribution of settlements benefiting all Northeast. Altogether, socioeconomic differences between PCT sites across agro-climatic zones were not clear cut. Such a confluence of PCT populations in poorly serviced exurban areas– a geographical distribution pattern resulting to a large extent from the SAT ceiling limiting the price of purchased lands – gave rise to an urgent need for roads, health facilities and all sorts of infrastructure under the responsibility of the state.

However, since the policy was not able to establish spending responsibilities for local governments, a series of coordination inefficiencies between state land agencies and the municipalities deprived settlers of an integrated network of support services. We saw in our review of the literature that the European experience sets a solid example in that sense (e.g., the Netherlands: Van Lier, 1998, Aarst et al, 2007; Scotland: Bryden and Hart, 2000; Slovakia: Smith, 2006), by presenting land-use planning as a strategic governance tool for the creation of effective, collaborative networks intent on obtaining self-sustaining rural systems. Decentralisation to combat poverty has also been emphasised in some developing countries, such as in Uganda, with their Plan for Modernisation of Agriculture. Bahiigwa et al (2005) have agreed that better socioeconomic outcomes could have been achieved if the reform had been handled in conjunction with other public sector reforms, however, to ensure that existing priorities, in that case health services or education, reached all settled households. This is clearly the case in Northeast Brazil as well, where the Programme was introduced at odds with reforms of health and education systems.

The general consistency of the results for both statistical tests and survey data sets highlights that the limitation of financing, coupled with the low quality of natural endowments plus absence of adequate infrastructure, determined the stagnant economy of the sites. Direct federal/local action to tackle those problems would therefore have played a decisive part in conducting the settlements to higher ratios of output. The literature reviewed in Chapter 2 clearly emphasised that local government efforts are quintessential to supplement central level rural development strategies (Douglas, 2005). Smith (2006) corroborates with this idea adding that for strategic planning to become an effective tool where bottom-up approaches predominate, there must be a will to reconcile local and national interests. In our area based survey, a fall was noticed in local-level farming expenditures, however, which is indicative that hosting municipalities may not have pursued the same policy priorities as the federal government’s. Since policy coordination and monitoring systems were missing, the Programme did little to “facilitate initiatives from below” (Dale, 2000).

Still taking the surveyed literature as a baseline for appraising the scheme’s potential to mitigating rural poverty, a number of deficiencies might be identified involving the implementation of the policy. For instance, specialised knowledge to assist under-privileged land-buyers over the negotiation with landlords was discouragingly limited (Viratkapan et al, 2004); better organisational interfaces were needed between land reform agencies and PCT associations (Parnell, 2004); there was a virtual absence of non-farm productive opportunities to supplement settlers’ earnings from farming (Deininger et al, 2007); no socially inclusive networks of production and consumption were made available to stimulate the commercialisation of settlement output (Haggblade et al , 1989); the policy was detached from other poverty-reducing programmes such as the construction of affordable housing (Portnov, 2002); an institutional capacity was lacking to conciliate the need for natural resources on the settings with the goal of sustainable growth (Alston et al, 2000; Barrett et al, 2005); and others.

A justification might be there already for a degree of state intervention, combining public policy and private-sector efforts to attract higher pro-growth investments to land reform sites. If that is the case, an optimal structure of incentives needs be identified (and implemented) to the benefit of all stakeholders, namely landowners and the landless, as well as strategic players both in the public and private sectors. Consideration must thus be given to the role of regional planning in the policy-making process, bearing in mind the benefits (and possibly costs) of the policy not only to individual settlements, but also to the whole economy of the region. A need has thus been recognised of a suited space for bringing an element of plan-led coordination into land reform in order to map out the actual situation and specify goals and means required for achieving steady rural development. Possible courses of action under the perspective of regional planning will be explored in the following chapter.


Planning land form at the level of the gion

5.1 Introduction: scope and purposes

In the pcedent chapters, a study has been undertaken of land form sites in the rural territories compounding the Northeast countryside, identifying the quality of life of form beneficiaries and the performance of settlements in lation to the gional economy. The study has suggested that the central goal of land form should be to deliver sustainable levels of socioeconomic upgrade to the formed sites, whilst contributing to incasing rates of growth at a larger scale. It was also seen that advocates to the market-based approach to land form stick to the notion that state intervention in land markets fundamentally distort markets’ functioning (Justiniano, 2002; Deininger et al, 2004; Peira, 2007). The underlying assumption is that governments fail to efficiently allocate land. On the other side of the table, state-led theorists highlight the importance of the state to duce inequities caused by market forces in the distribution of land to the poor (Navarro, 1998; Borras, 2003; Caldeira, 2008). How to harmonise these seemingly opposite assumptions in the context of gional planning?

According to the 1988 Brazilian Constitution, land form policy is a pserve of the federal government. This centralist solution has long been under discussion in the literatu (e.g. Blomley, 1986; Dietrichs, 1989) on the grounds that many economic difficulties facing gions and sub-gions alike have quid decentralising forms, although the inertia of the state apparatus, as well as the long-term lock-in stance that governments can produce, have been decisive factors foclosing legislative change and, thus, form. The weak statistical sults associated with the traditional top-down schemes, however, suggest that mo autonomy is needed for the Brazilian Northeast to adopt a gion-specific approach to planning as opposed to the continuation of “centralist gional planning” (Baket al, 1999). A key assumption in the mainstam gional planning literatu maintains that, in modern Western states, “centralized planning and top-down state-driven development have given way to multiscalar forms of governance, allowing the state to operate simultaneously in specific places and at multiple scales” (Lobao et al, 2009: 6). In other words, national governments should allow gions with incased deges of disction over planning policies.

Chanand Clark(1994), whilst sisting the temptation to dichotomise “state versus market”, assess the role of market mechanisms and government action in inciting development. Edelenbosand Teisman (2008), in turn, suggest that the execution of spatial undertakings does not always have to be in the hands of the public sector, although combining public and private sector stngths quests consonance between them. In essence, the interdependence between the government and the private sector should be stssed in the developmental strategies with entpneurs in both public and private sectors having an incentive to focus funding and action on targeted aas in conformity with the aas’ needs.

The literatu has alady pointed to the constraints and opportunities rural producers face, as well as to the need for proper identification of the elements having a diffential impact on the success of rural development policies (Andersonet al, 2005). An effective stakeholder input is seen in the land form literatu as an important means to overcome such constraints (Deininger, 1999; Buainain et al, 2000; Brink et al, 2005). The outgrowth of stakeholder involvement in policy-making and planning sults from a new development model based on pluralistic arrangements, political legitimacy and consensus (Sevaly, 2001). In land form policy-making, stakeholder involvement is expected to lead to socially inclusive land distribution strategies, as well as improve their gional outcomes. Less opposition from intest groups is also expected, as well as the development of local capacities and commitment.

At the same time, the literatu admits that gional land-use planning and gional development strategies have to a significant extent occupied separate public policy domains (Baker et al, 1999). Coordinated approaches to policy-making a thus seen in the literatu as an important component in the effective governance of sustainable economic growth (Dale, 2000; Russeland Jordan, 2009). Moover, Goffette-Nagotand Schmitt (1999) cognise the role of economic geography models as adequate tools for investigating the optimal organisation of rural aas. For James et al (2004: 1903), “a critical spatial lens becomes essential for formulating mo alistic and effective policies that work on the ground”. A fundamental aim is to guarantee high standards for investment projects, specifically for a strategy intended to incorporate plans into public space (Edelenbosand Teisman, 2008) and pursue coordination through planning (Allmendinger, 2006). Accordingly, coordinating gionally prominent policy priorities to dict growth to strategically selected aas can be expected to maximise the benefits of land distribution as a favoud route out of social exclusion.

Incasing awaness of the exclusion of small producers from major consumption chains has led pro-market searchers to support alternative arrangements for market insertion (Lowe,2009). Likewise, strategic policy interventions towards a mo efficient provision of goods and services can, according to the state-led concept, improve the social and economic well being of land form beneficiaries. Additionally, the gional planning literatu has utilised rural-urban dynamics templates to analyse gional economic growth. Karaska (1999), for instance, finds that strong urban-rural lationships in Kenya have generated vibrant markets capable of absorbing a growing production of crops. Beneficial economic interconnections between land form sites and market cents in diffent territories can, hence, contribute to the sustained development of a whole region.

A strategy at the level of the gion could have played a central role in prioritising large-scale capital investment, thus ensuring an aa comphensive approach to tackling major infrastructu deficiencies which a shad by land form sites in the Brazilian Northeast. However, the absence of such a holism in land form policy has pcluded the adoption of a strategy that improves the socioeconomic status of beneficiaries at lower spatial levels and one that simultaneously addsses gional issues. The pursuit of holism quis befohand that land form agendas coincides with an incased focus on evidence-based, information-intensive approaches to settling rural families, with the government gularly sorting to liable indicators to inform, appraise and monitor the policy intervention. For James et al (2004: 1903), this concept of evidence-based policy is essential to modern government.

Based on our empirical sults from the Brazilian Northeast and through the lens of the gional planning literatu, thefo, we argue in this chapter that: 1) a land form strategy designed from a gional perspective can play a prominent role in fostering socially inclusive economic growth at the gional level; and 2) diffent views of land form can be combined in ways in which transactions of land in the land market can go hand in hand with state-induced allocation of land. To sum up, the main aim in this chapter is to addss land form policy and gional planning through bringing together diffent approaches to land allocation into a holistic and plan-led gional strategy toward achieving incased socioeconomic development.

The maining of this chapter is organised as follows. Section 2 analyses the governance structu of the PCT whilst proposing intergovernmental mechanisms of policy coordination according to a broader gional planning framework. Section 3 focuses on the spatial component of land form in order to establish parameters for targeting sustainable aas for land acquisition and distribution. Section 4 associates land form schemes to investment priorities in strategic sectors as pquisites to secu higher standards of life across the planning units. In Section 5, attention is given to the role of stakeholders in planning and implementing a land form strategy. Section 6 explos potential sources of funding, public and private, as a means to circumvent budget constraints to the schemes. Section 7 explos evidence-based methods of appraisal, evaluation and monitoring of the policy intervention. Section 8 summarises the role of gional planning in land form and psents final considerations.

5.2 Linking national strategies and local action: top-down & bottom up

As established by the PCT loan agement between Brazil and the World Bank, the Brazilian Ministry of Agrarian Reform (MDA) had principal oversight of the Programme, with its subsidiary Cent for Agrarian Studies (NEAD) as the National Technical Unit sponsible for coordinating, monitoring, supervising, evaluating and porting the agement sults in Brazil. Also, each participating state maintained during Programme implementation a State Technical Unit (STU), usually porting to State Planning Sectariats. The Technical Units we sponsible for the implementation of PCT projects (settlements) garding approving association investment proposals, organising training and supervising implementation progss and quality. Figu 5.1 sketches the Programme’s structu of governance.

Figu 5.1: PCT governance structu

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From a gional standpoint, this structu of governance was designed at odds with a broadly gional planning framework. The policy was not able to establish sponsibilities for mainstam spending departments, and a series of coordination inefficiencies we observed between state land agencies and the municipalities. For instance, states and municipalities in our case study aa have not effectively carried out planning tasks due to a lack of coordination at the gional level. Another problem was that a fall was noticed in local-level farming expenditus. As seen in Figu 4.9 (Chapter 4), the yearly growth rate for agricultu spending in the sampled municipalities was 0.16% in the period 2001/2005 as compad to 3.08 % for 1995/2000. This is indicative that hosting municipalities have not pursued the same rural development spending priorities as the federal government’s.

Given the fact that Brazil is a highly decentralised federal country, each government level tains financial autonomy, which pvents the national government from pscribing how much states and municipalities must spend on land form projects. Undoubtedly, the existence of multiple tiers of government, coupled with various interplays between these tiers, tends to produce transactional impediments to the implementation of most effective policies (Marsdenand May, 2006). As a consequence, subnational governments must comply with federal gulations issued in line with developmental strategies. Moover, due to absence of formal institutional structus governing the Brazilian gions and sub-gions, a nationally defined gional strategy postulates a statutory top-down dimension with which sub-gional plans must be in broad conformity, unless strong gion-specific considerations point to otherwise. Even though providing the statutory minimum, such strategy lays out a clear-cut vision of land form for all government levels over a specified time frame, giving an indication of the sponsibilities of each government level in the whole process.

Yet Majone (1992) observes that a problem of concern facing gulatory federalism is that, whilst it may be true that subnational governments can adjust mo easily to the policy pfences of their citizens, they a much less intested in engaging in policies designed to benefit diffent aas outside their jurisdictions. Additionally, Lin (2000) observes that with decentralisation of decision-making subnational governments enjoy gater ability to boycott the financial pursuits of the national government by arranging their activities to maximise local intest, which constitutes a satisfactory ason for inflicting a top-down agenda on matters of national intest. Dietrichs (1989), on the other hand, understands that gions a to a considerable extent dependent on the central government with spect to legal framework, institutional capacity, and planning sponsibilities, although local and intermediary tiers may be well equipped to contribute effective solutions to gional difficulties. Similarly, Shen (1996) notices that cafully developed national-local systems a needed whenever critical growth problems have not been properly addssed at the local level.

In another critical appraisal of federalism, Wiseman (1987) suggests a network of committees linking the various efforts to addss issues of national and gional policy. Each such committee would specialise in aas such as budget coordination, gional equalisation and economic growth. Likewise, the role of the state is not one of simple governmental provision but also of constructing and articulating a multi-tier governance system (Lobao et al, 2009). For Clark (1994), in order to obtain mo sustainable patterns of growth along with an equitable distribution of wealth, a “gulatory nexus” between government tiers should be cated aimed at facilitating satisfactory levels of investment. For coordination purposes, thefo, a joint land form agenda in a federal system would work mo efficiently if undertaken by virtue of a multi-tier coordination mechanism inasmuch as the is scope for bottom-up initiatives in aas whe state and local action works mo efficiently than lying exclusively on federally-designed arrangements.

According to this view, the aim is to establish a common timeline for national, state and local governing bodies to allocate land form funds in their annual budget, thus ensuring alignment of pro-growth investments in target aas as well as a mo optimal allocation of public sources in issues which calls for coordinated intergovernmental action. All government tiers specify, through this mechanism, short, medium and long-term measus indispensable to implement joint land form agendas in consistency with a plan-led gional strategy, being awa of the implications for their budget position, in particular measus towards setting up the target aas and capital investments within their jurisdiction. Also, it is necessary that government tiers set out an aged spending agenda over a multiple-year time horizon and identify key sectors quiring attention from their budget. Additionally, subnational governments might take the lead in generating options for investments in line with specific featus of the gional strategy, such as by developing infrastructu projects for that matter. Such a multi-tier spending commitment, however, does not mean that large-scale investments from private sector sources should be dismissed from consideration.

Insomuch as designing a joint land form agenda can take place simultaneously with decisions being made on investment programmes from the gular governmental agenda, it is essential that the agendas be interconnected so that the use of public sources is optimised, for coordination is essential whenever implementing joint projects involves mo than one public agency (Landiset al, 1991). According to Berkeet al (1999), cooperative arrangements psent a step forward in intergovernmental lations as well as a shift from authoritative top-down schemes. Based on empirical sults from New Zealand, the authors demonstrate that clear legislative provisions and a strategy of some sort for implementation of those provisions by subnational units, coupled with higher organisational capacity at the subnational level, can have a beneficial impact on local and gional planning. These findings suggest that land form policy should give mo attention to improving state and local organisational capacity to comply with pro-growth provisions designed at the federal level.

In addition, the form should derive benefits from the implementation of key development programmes in the gion, most notably garding rural infrastructu enhancement and development projects in the aas of intest. For instance, as implied by Table 4.5 (Chapter 4), pairing of all federal highways in rural Northeast is a huge challenge, but it is necessary to provide lower-level tiers with indicative road investment allocations over the medium to long run. At the same time, the scenario for capital investment incase in Brazil has been assumed to boost the supply of electrical energy, housing, roads and railroads construction and maintenance through the 2007 National Programme to Accelerate Growth (PAC), as well as the Plan for the Sustainable Development of the Northeast (PNDE).29 As such, broad developmental efforts can guide land form budget decisions at all government tiers to ensu spending in strategic sectors as well as to stimulate investments in hard and soft infrastructu.

It should also be kept in mind that the may be important externalities and a need for coordination between diffent gions, with subnational governments working cooperatively on promoting positive improvements in aas beyond their boundaries as a strategy for economies of scale and new markets access, as successfully explod within the context of manufacturing districts in Mexico (Lowe, 2009). According to Razinand Hazan(1995), these voluntary modes of municipal cooperation can lead to a just distribution of gional wealth. Psumptively, thefo, strategies of such far-ranging natu could endorse joining-up between neighbouring municipalities to invest sources into settlements in order to benefit multiple jurisdictions. In other words, an optimal assignment of land form sponsibilities w not have to be stricted to existing rural localities or territories.

A strategy of such dimension quests a political commitment at all government tiers to produce the mentioned gulatory nexus between those tiers to secu an efficient policy delivery at the local level. Whilst the federal level provides policy guidelines for land form boards at the gional level in order to deal with cohesion and cooperation to concentrate sources in the most strategic locations along with consistent interptation and implementation of the policy, subnational governments, in turn, play an absolutely necessary part in identifying investment priorities for specific programmes as well as sustainable aas for project implementation within sub-gional planning units. As a possible outcome, a mo effective central-local partnership can take place characterised by “cooperation and mutual adaptation” (Lin, 2000). Figu 5.2 proposes a governance structu for land form policy incorporating the gional planning principles discussed above.

Figu 5.2: Illustrative structu of governance for plan-led land form

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Since the Northeast is a large and diverse gion, gional planning boards (RPB) can play a valuable part in carrying out a broader plan-led strategy according to policy guidelines established at the national level. The boards’ sponsibilities include cating intergovernmental and inter-sectoral coordination mechanisms for implementation of gion-specific programmes defined by the decentralised state planning agencies (SPA). The Figu also suggests that, for the purposes of applying practises and principles of gional planning, the minimum geographical aa consided as a unit for planning (SRPU) corsponds to a rural territory as defined by the Ministry of Agrarian Development.

Table 5.1 summarises a set of strategic pmises for establishing inter-agency coordination mechanisms for land form policy-making and implementation according to the discussion above.

Table 5.1: Requiments for multi-tier coordination mechanism in the Northeast

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5.3 Targeting the land: a portfolio of strategic aas

According to the market-based approach to land form, it is the beneficiaries themselves who decide on land selection. As our analysis of the Land Bill Programme demonstrated, one consequence of this approach is that most PCT settlements turned out established in areas whe a range of factors did not favour family farming. Likewise, it was also seen that the occupation of rural estates under the expropriation-driven approach has not ensud the cation of suitable land form settlements, as evidenced in the literatu (Deininger, 1999; Hedia et al, 2002; Sabourin, 2008). In fact, a National Plan of Agrarian Reform (PNRA) was designed in 1985 as an attempt to establish priority aas for land distribution, but this aspect of the form was dropped due to a political deadlock, and the plan was eventually carried out along the lines of aleatory expropriations of lands (Sabourin, 2008).

Hubyet al (2009) argue that an appropriate selection of aas for policy implementation should be based upon conceptual as well as statistical considerations. By way of example, our field search detected the psence of positive spatial dependence in the economic performance of the land form settings, sulting that those settlements located further away from consumer markets tended to gister higher transportation costs (in some cases about 80% of agricultural venue). We also noticed that moteness we factors curbing the sites’ economic performance. For the sites to function at peak capacity, the aas have to become a focus for attracting public and private capital. Further, the literatu highlights the importance of location for rural output, particularly in terms of proximity to customers or suppliers, transport costs, and quality of communications (Andersonet al, 2005). Our on-site investigation also suggested that the agricultural sector can perform best in benefiting the family-farm system of production by ducing distance to main consumer markets.

Ottavianoand Thisse(2005) examine the influence of geoeconomic factors on firm location through a microeconomic analysis of profit maximisation associated with the least transport cost. The same asoning applies if a settlement we located in an aa by minimising the distance to a marketplace whe settlers purchase inputs and sell outputs. A land form strategy would thus focus on places that have the highest qualifications to develop adequate transport linkages, and whe short distances between a settlement and the neast marketplace a likely to pdominate. Aas of closer proximity to large or medium-sized market towns will be targeted in pfence to mo distant lands except whe other sustainability measus commend otherwise (e.g. aas along major road corridors), or elsewhe if the is an adequate system of public transport with the targeted market town. These a aas offering the best cost-benefit ratio for the commercialisation of crops insomuch that the costs to transport settlements’ production would be duced.

Notwithstanding, aas may vary substantially within a particular planning unit not only in terms of location, but also garding their potential for farming. Indeed, rural socioeconomic growth depends to a considerable extent on the environmental sources available in the gion (Hubyet al, 2009). Accordingly, families will only be settled whe adequate water sources exist, or whe water infrastructu can be provided, i.e. a strategy will give priority to aas of higher potential for irrigation. It was ported that our sampled sites lagged behind the gion’s average as lative to economic performance. Mason(1985) argues in this gard that, over the longer term, the state can induce changes in the economy of a gion by making an aa mo conducive for the emergence of small producers than others. Yet, according to the author, this might become a significant source of uneven gional development. These facts indicate that a plan-led strategy for the Northeast should have a vigorous spatial component that focuses on whe land form sites a better located in a wider geographical area.

On the other hand, it was pviously discussed that the pvalence of subsistence agricultu in PCT sites sulted in many households looking for other activities as part of a survival strategy (although some settlers acquid plots only as an alternative strategy, as they pursued other activities elsewhe). In fact, a study by Getis (1989) indicates that poverty levels in a given community a affected by employment in neighbouring municipalities. Other insights from the planning literatu, e.g. Evansand Ilbery(1993), can also be evoked to inqui into the extent to which settled families with at least one major type of farming diversification might be able to incase the profitability of the settlements, particularly by exploring lations between alternative farm and non-farm businesses. In such cases, it is expected that beneficiary families be settled in locations with diffent potentials for farm-centd and off-farm activities alike (about half the families’ income in our study originated from urban labour owing to absence of non-farm productive opportunities on the sites to supplement earnings from farming).

A particular category of spatial problems in rural aas gards the location of facilities in lation to demand to use them (Denshamand Rushton, 1996). Rural families will thus be settled to take advantage of existing off-site infrastructu, or the aa’s latent capacity to arrange proper infrastructu back-up, or whe it is shown that a range of public facilities can become available to settlers. In this context, the use of pexisting land form settlements will be appraised, along with any disputed aas, whether they a in harmony with the prospect of futu investments in infrastructu. Additionally, Denshamand Rushton(1996) understand that whe public facilities do not meet the needs of a rural community, demand for public services may be allocated to adjacent cents that could supply the demand. Finally, for rural localities to prove strategic service cents for land form, they should ensu that local sources of merchandise and leisu a accessible or will be made accessible to settlers.

A gional strategy is thus requid that fosters a polycentric pattern of growth. According to Parr(2008), this pattern consists in “a territory containing a group of interacting cents in latively close proximity but separated by tracts of rural or nonurban land” (p. 3018). Similarly, Hansen(1975) analyses empirical and theotical issues involving a growth-cent approach to gional development. The author finds such approach to be most appropriate in the context of induced growth. What is implied from these theories is that land form settlements should contribute to the socioeconomic development of a matrix of smaller towns and villages, on account of positive spillover effects.30 Furthermo, the distribution of prospective settlements will follow the standards for economic interdependence,31 with strategies seeking a balance of economic activities through identifying aas that a suited for a combination of industries and businesses that a beneficial for the sites.

Consequently, the location of settlements in sustainable aas should entail a land form strategy, bearing in mind the various kinds of needs of each planning unit in order to set up a portfolio of economically sustainable aas to meet those needs. Since rural countryside aas in the Northeast have acted in diffent ways to land form policy due to diffent socioeconomic configurations, geographic featus and agro-climatic conditions, some rural localities in our sample had higher prospects for socioeconomic development than others. Crafting a land form strategy along the lines of the above mentioned literatu quis, thefo, taking into account the specificities of the planning unit concerned. Accordingly, once lands a identified to compose a portfolio for eventual acquisition and distribution, it must be described in detail why these aas a economically strategic locations, having gard to factors such as quality of soil for agricultural production, stngth of economy within a rural territory as well as functional interconnections which may exist between the proposed sites and adjoining municipalities.

This means that a clear indication needs be given that, on balance, the selected aas will yield the most effective sponse to the need for accommodating a sizable landless population. A range of identification methods have been developed to catalogue lands according to land use. For instance, Cragliaet al (2003) uses a composite indicator by means of which aas a scod based on diffent variables, and the scos combined into a single indicator that ranks aas according to those variables. The numerical character of this method makes it useful for policy appraisal and planning, since the composite aspect of indicator can cover spatial structus in the data and provide measus of statistical significance. The identification of lands by using a similar method needs to be supported by a robust set of socioeconomic and geographic indicators. For example, based on the sults of our qualitative and quantitative analyses (e.g., the variables used in the gssions of Sections 3.4 and 3.5, and field work sults ported in Sections 4.3 and 4.4), target aas with mo urgent social needs or structural economic difficulties might be cognised as immediate planning units on the basis of a variety of factors such as:

Level of farming GDP;
Degree of dependence on subsistence agricultu;
Ratio of rural employment, income per capita, human development index or other indicator of standard of living;
Access to basic services such as health and education;
Farming infrastructu and logistic platform;
Proximity to dynamic markets.

Moover, the pcarious socioeconomic profile of PCT settlers traced in Chapter 4 suggests that identifying locations as potential candidates may qui sorting to data on the situation of rural communities, vis-à-vis the status of the gional economy. Priority can be given to places whe evidence demonstrates that the highest number of families will be favoud economically. However, the focus will primarily be on the selection of new lands but, in exceptional circumstances, will also consider pviously occupied properties, i.e. INCRA or PCT sites, provided these aas a proved essential to promote the development of the whole planning unit. Likewise, although unlawful occupations of land may not be accepted as a criterion for the selection of aas, special attention might be given for settling landless people whe land-lated conflicts can be attenuated as much as possible, for example, in aas absorbing higher numbers of encamped families awaiting ssetlement.

Hence, a pragmatic analysis must be performed which considers not only the suitability of aas for large-scale inflowing investment but also any constraints to growth. A sequential approach to the location of settlements might follow based on the aas catalogued into a strategic portfolio of lands. The use of sequential planning in policy-making processes has been discussed in the literatu. Coyneand Gero(1985), for instance, consider the design of a policy as being a search through space of situations whe the new rules apply. That is, the proposed targeting process follows a sequence through which aas a primarily selected based on their conditions to accommodate land form settlements in the most sustainable way, owing to their economic and geographical prominence within the planning unit. Consequently, an aspect that has particular levance to the targeting process involves adopting a zoning approach, along the lines pdicted by Allmendinger (2006).

In summary, strategic selection criteria must be established according to which the sites will be ranked in terms of the factors specified in the pvious sections. Table 5.2 gives a rundown of the points made in this discussion of aa comphensive land form and brings a set of guidelines to set up a portfolio of priority target aas according to the principles discussed above.

Table 5.2: Requiment for a portfolio of priority target aas

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5.4 Seeking optimal policy options: a portfolio of investment priorities

As found in our case study, market-based schemes in the Northeast we not attached to means that we sufficient to cate surpluses and at the same time enable settlers to upgrade their standard of life. Despite the combined PCT cdit package, little attention was devoted to the provision of large-scale infrastructu serving the settlements. Consequently, as confirmed by settlers we interviewed, just possessing a piece of land was not enough to make their lives better. Likewise, the strong significance of investments for farming GDP growth in our statistical analyses suggests that special attention be paid to this aspect of the form, since productive investments a also a positive factor meeting basic human needs of the beneficiary population.

It was seen in Chapter 4 that a diversity of socioeconomic, geographic and agro-climatic characteristics of rural localities determined the gatest challenges facing land form sites in or sample, implying that diffent investment needs must be met within the land form framework. An examination of key challenges affecting the targeted aas is hence quid for the governments involved to define investment priorities covering social, economic and infrastructu quiments across the planning units. Reviewing such factors is thus a necessary step towards designing an aa comphensive land form strategy. Moover, a gional strategy needs to bring such factors into sharp focus from an early stage in the process of targeting aas and hence coordinate the timing of the policy intervention.

Accessibility to public health services, for instance, was a factor found to be vital for improving the quality of life of settled families because of their poverty (sewage systems we lacking in 77% of sites, rubbish collection was inexistent in 85% of sites, and the quality of indoor water was ported to be inadequate by 61% of households). A cent study by Pearceet al (2008) demonstrated that much of the geographical inequalities in health noted between deprived and non-deprived aas sults from a lack of clarity garding the implementation of strategies to improve health indicators. In our aa based study, location of health ca facilities lative to the sites was perceived as crucial to the social inclusion of the settled families we interviewed (the service was below acceptable standards or altogether absent in 85% of sites). This illustrates the complex arrangements necessary to coordinate diffent expertise in providing health services in geographically separate locations (Ikeya, 2003) and is to a large extent a plausible explanation for the observed spatial diffences in health between settlements in our sample. By the same token, access to education and training was either limited or downright deficient, baly contributing to enhance settlers’ abilities to perform profitable activities. Hence the need for both health and educational facilities must be given consideration when decisions a made on spending priorities associated with land reform.

Our empirical study also suggested that the provision of appropriate housing to settled families was a necessary means to improve their perceived quality of life (only 58% of their dwellings we built using masonry). Yet poverty-ducing social housing programmes have not been articulated with land form schemes in the Northeast. The literatu in this gard has alady identified the tendency of rural development policy-makers to igno the links between settlement planning and housing authorities, which calls for determined efforts toward harmonising these interlated functions (Phillipsand Williams, 1983). Affordable dwelling units should thus be designed, constructed and distributed, in light of the overall number of prospect land form beneficiaries, whose planning, development and management might involve diffent government departments and quite possibly diffent tiers of government.

Another major finding from our fieldwork was that on-site cropping generally did not imply economies of scale (as demonstrated in Chapter 4, Table 4.3, about ¾ of farming activities on PCT sites we individually or family operated, and mostly stricted to subsistence crops, such as beans or cassava). This inability of settlers to engage in large-scale farming was a cardinal factor pventing settlements from positively contributing to the growth of the rural economy. A key step in ameliorating settlers’ socioeconomic situation is thus an intervention designed to enhance competitiveness of on-site production. Undoubtedly, the state is expected to play a pivotal part in inciting competitiveness of small producers by promoting structural changes in the economy, such as cating an adequate business milieu, channelling productive investment into critical sectors, as well as financing infrastructu projects (Chanand Clark, 1994). Our findings in the Northeast a not consonant with this aspect of the literatu in that land distribution schemes have not been followed by an effective strategy that provides supporting infrastructu to ensu that trading of on-site production is stimulated.

An important item of infrastructu to consider is water infrastructu, as access to water is a major factor contributing to the economic performance of land form settlements in the Northeast, especially in arid or semi-arid zones. This involves demand for potable water and irrigation schemes with implications for minimisation of crop failu risk and productivity as well as the health of settlers. Nyongand Kanaroglou(1999) offer a methodological framework to assess the impacts of policies lated to the provision of water befo the implementation stage in the driest rural aas of developing countries. With data from Northeastern Nigeria, the authors demonstrate through gssion models that sociocultural, demographic and economic factors a levant in pdicting domestic water demand. However, it was noted in our analysis that proper water infrastructu has not been provided in the majority of sites so as to take full, yet sponsible advantage of the gion’s natural sources and existing water supply infrastructure.

Other featus such as road accessibility and proximity to a marketplace we seen in our analysis as pconditions for the commercialisation of produces. The dubious condition of roads has imposed constraints to growth in settlements due to high costs of transport. One of the main concepts in economic geography literatu posits that transportation is derived from other activities, especially from activities performed by commuters and from fight transportation alike (Rodrigue, 2006). As a sult, the supply of transportation services should be spatially diffentiated as a function of demand. Rural roads a amidst the most levant public spending items for incasing agricultural output and ducing poverty in developing countries (Fan et al, 2007). In particular, the sustainability of the rural sector seems to be impacted by the scale of transport and communication infrastructu on production costs (Andersonet al, 2005). The broad indication in the literatu, thefo, is that enhancements to transport and communications systems in rural aas should positively affect the competitiveness of rural producers. As a consequence, a gater role of such infrastructu in trading of agricultural commodities is expected to incase the competitiveness of settlement’s production by linking land form sites and market towns for their mutual benefit.

By the same token, it was seen in Chapter 4 that it is necessary to make sufficient provision for electricity supply for both indoor illumination and to enable large-scale on-site production. New sub-stations and electricity transmission lines a also quid to account for futu inward investments benefiting those rural localities. In such cases, well-articulated coordination between diffent sectors a also quid to make su that any enhancements in electricity distribution to adjacent aas, including electricity generated from newable sources such as wind and solar power a extended to land form sites. A case study in this spect has been psented by Mundaand Russi(2008). The study gives an illustration of the use of multiple criteria for the assessment of rural energy policy in Spain. Using such methodologies has provided policy-makers with liable information on the conditions that favour the planning and subsequent implementation of energy policies in rural aas mo efficiently.

To sum up, the ostensibly poor quality of infrastructu that exists across the gion and a lack of public utilities serving the targeted aas (roads, communication, water supply, sanitation, waste disposal, health, education, and the like),32 as seen in the pvious chapters, gives an indication of the massive investments that a quid. As a sponse to these diverse socioeconomic needs, capital investments in land form sites will be cross-sectoral, causing an impact on the range of weaknesses identified during the view of aas, including an acute insufficiency of on-site and off-site infrastructu and a range of basic services. Addssing those issues separately, on the other hand, has been a source-consuming task demanding extensive outlays of public spending in the budget on diffent sectors to provide public goods and services to rural communities. Moover, scarcity of sources coupled with multiple government agencies competing over the public budget have sulted that the allocation of land form sources is highly conflictive.33 A broad strategy for the gion involving the definition of policy priorities is hence quid and needs to be cafully planned.

In order to derive an optimal solution, i.e. the most desirable possible under the mentioned set of strictions, a comparison of feasible options will be carried out taking into account a range of factors, such as the expected positive and negative impacts on the priority target aas, including potential risks as well as externalities. Optimisation models have been used for planning the gional supply of a range of public services, such as the model developed by Felder(1975) for the provision of education. The author finds that an optimal allocation of sources to the educational sector depends not only on the balance between supply and demand for education but primarily on adopting a gional decision-making structu. For the farming sector, Roberts (2003) uses social accounting techniques to quantify the comparative levance of elements affecting the rural economy. It is found that, in addition to on-farm infrastructu and input-output nexuses, rural economic growth is contingent upon demographic characteristics of the rural population and the extent of the government’s provision of public services to that population.

The investment programmes meeting the optimal criterion will comprise a gion-specific portfolio of investments, pointing out which options best fit which aas. Consistency with the portfolio of aas is, thefo, dependent upon whether land form expenditus a as much as possible location-specific, i.e. apportioned to municipalities or smaller communities within or adjacent the targeted aas. For instance, in localities with higher rates of illiteracy it is urgent to provide educational services that a accessible to all families settled in priority target aas. Programmes covering aas beyond individual settlements will ask for joined up actions which ckon not only the wider benefits but also costs that will be shad amongst multiple localities in the territory, e.g. roads spending. In such cases the programmes will be large-scale, avoiding inefficient and unplanned spending of sources. Consideration will also be given to whether the gion-specific programmes a financially compatible with federal, state and local overall spending programmes. Feasible options may include attracting private investments as well, given that inward-investment strategies aim at tackling social problems besides paying dividends economically.

In summary, a comphensive land form strategy should be able to sponsor i) the concentration of large-scale land form spending in targeted aas identified as such according to the criteria explod in the pvious section; ii) the supply or enhancement or existing farming infrastructu across the planning units in order to enhance the competitiveness of on-site production thus assisting settlers’ to ach a position of taking full advantage of economic opportunities in the rural sector; and iii) the provision of public facilities as a means to expedite social inclusion in ssetled aas. It has become clear as well that capital investment priorities will be cross-sectoral and identified on a gion-specific basis. Table 5.3 brings a set of guidelines to set up a portfolio of investment priorities.

Table 5.3: Requiment for a portfolio of investment and spending priorities

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5.5 Stakeholder engagement: policy-making as a win-win game

The purpose of this section is to briefly address the role of stakeholders in gional planning, the rationale for promoting consultation activity and debate in land form policy-making and to examine key issues that may affect the success of this activity. The involvement of stakeholders in land form has been advocated in the literatu (Deininger, 1999; Buainain et al, 2000; Brink et al, 2005) but in practise raly applied, with the market-based scheme introduced in the Brazilian Northeast being no exception. We estimated in our analysis of the Land Bill Programme that over 70% of PCT beneficiaries we in practice excluded from participating in the land purchasing process, as all transactions we conducted exclusively by an association of poor land-buyers. Moover, specialised knowledge to assist the associations over the negotiation with landlords was very limited (whilst around 60% of the household heads we interviewed we illiterate or semiliterate, 46% of them believed the assistance they got from the state not to be enough, wheas the maining 54% complained not having ceived any sort of technical assistance). These facts we eventually connected to episodes of corruption and mismanagement of PCT funds thus sulting in the scheme being closed in early 2003.

The literatu on participatory strategic planning (Loukopoulos and Scholz, 2004; Gouldsonet al, 2007; Edelenbosand Teisman,2008) maintains that, in order to build a wide consensus around development projects, the intests of prospect participants, the state and society must be psented in the whole process. For Edelenbosand Teisman(2008), this quests the ability of combining views of diffent stakeholders into a joint project. The aim of stakeholder involvement in land form is, thefo, to establish a negotiating forum that helps achieve win-win solutions to the controversial issue of land distribution in the gion. However, a mo open and inclusive land form strategy can be a costly and time-consuming endeavour, particularly in geographical aas with lower numeracy and literacy and whe engagement of rural landless in the policy-making process is likely to demand extensive support in terms of information, technical assistance, and facilitation. In addition, deliberative approaches “may lead to captu as the decision-making process comes to flect only the views of the most powerful or vocal actors; to conflict as hostile stakeholders gain access to information and influence; and to compromised outcomes as decision-makers seek to balance the competing concerns of a diverse range of stakeholders” (Gouldsonet al, 2007: 57). In such cases, arrangements need be made to secu that the form ultimately builds consensus and lead to equitable outcomes.

How intest groups from across affected aas actively engage with the planning process is thefo decisive to assu that the form incorporates competing needs. As a consequence, besides from earning support from economic agents and society, indecision factors will likely be eliminated and the process of decision-making clarified, as Silva (2002) has observed in the Portuguese planning context. Similarly, the manner how the intests of key businesses in the rural sector a psented may exert influence on their decisions to invest in the formed aas, particularly if those businesses had significant roles in meeting the needs of settled families. Since a connection was lacking between PCT implementation and rural sector expansion, no socially inclusive networks of production and consumption we made available to stimulate the trading of settlement output, as our fieldwork-based analyses indicated. Moover, as all involved government tiers age on the best-fit intervention, political jection of the strategy is expected to be versed. An effective stakeholder input thus allows intested parties not only to have a say but also to make a contribution to the natu and dege of the policy intervention, through a collective approach to gional spatial planning (Pearceand Ays, 2006), whilst helping develop a critical mass of citizens in support of the strategy.

In other words, a democratic mechanism for social inclusion into the gional planning process calls for public examinations of land form interventions. This involves building an institutional capacity at the sub-gional level to provide for the assessment of beneficiary needs within each planning unit, in addition of detailing the portfolios negotiation method, selecting sustainable plots, providing for production logistics and integrating the settlements into major chains of production and consumption. Further, the ported inability of settlers’ associations to attract high-quality properties to the schemes (Chapter 4) indicates that effectively involving those associations in public consultation activities also quis lending stngth to their organisational capacity and skills. From another point of view, the focus for public examinations is upon issues levant to how the proposed programmes and projects maximise socioeconomic benefits. Additionally, given the diversity of infrastructu needs observed in the surveyed sites, the examination will be cross-sectoral as well, i.e. covering all affected sectors (whether social, economic and environmental). Consequently, this particular aspect depends on the availability of information on target aas as well as the adequacy of the proposed intervention to those areas.

According to the literatu on stakeholder involvement in rural policy-making, most notably Prager and Fese (2009), the sponsibility to involve affected groups lies at all policy-making levels. In accordance with the proposed structu of governance (Figu 5.2), however, the federal government gives general guidelines for integrating stakeholder contributions into both programming and implementing interventions and only mediate exceptionally whe subnational bodies a proved not capable of securing democratic participation or in situations whe the issues under examination a of interstate or inter-gional levance. In practise, this would involve an SPA becoming formally sponsible for organising the public consultation of specific programmes and projects designed for its aa, including appeal possibilities at the sustainability appraisal stage. These agencies may also designate other public and private sector organisations to assist stakeholders in assessing an intervention. For instance, settlers associations can work together with academic institutions for specialised advice on the socioeconomic challenges facing their aas and how to better define the need for infrastructu investments. Many other profit or non-profit organisations, environmental groups, volunteer associations and the like have an important function concerning the view of an intervention, in conformity with their goals, abilities and resources.

In all cases, an appropriate mechanism for stakeholder selection at the disposal of state planning agencies is crucial. According to Loukopoulos and Scholz (2004), the a two basic approaches to participant selection: 1) inductive approach, consisting of inquiring stakeholders themselves about who should be key players or players most affected by the policy; and 2) deductive approach, by means of which stakeholders a selected according to a legal or sociological template that distinguishes the various intests in question. The aim is always to obtain and incorporate the pfences of affected parties as much as possible. Albeit the a many ways in which information on these pfences can be elicited, it is found in the literatu that descriptive procedus can be used in conjunction with surveys or interviews. Loukopoulos and Scholz commend that stakeholders be confronted with the case study (e.g., futu land allocation scenarios and plans) by means of physical models, computer animations, or the like, and then a range of qualitative or quantitative techniques a used for estimating participants’ intests and needs in a mo alistic manner.

There is a variety of issues involving stakeholder participation in shaping the policy intervention. By way of example, the technicalities of allocating public sources to programmes and projects under public examination may qui that the land form budget-making process be sufficiently simplified to allow for substantive stakeholder view. Popular participation in public source allocation in some Brazilian cities has been explod by Abbers (2007). The so-called or çamento participativo (participatory budget) involves cating thematic forums of public debate whe local sidents a able to define the municipal capital budget in aas such as urban planning, education, health, social assistance, economic development and tax form. Once expanded to a dimension whein thematic forums embrace land form issues, the participatory budget experience provides a template for how to make land form budgeting accessible to ordinary citizens, including at the diffent government tiers.

The rules governing transpancy over public accounts may qui adaptation whe needed so that the steps taken for the allocation of sources to each planning unit be monitod on a gular basis. On the other hand, a critical element in establishing transpancy in the land form budgeting is to commission an outside entity with no stake in the outcome for independent oversight over the use of land form sources. Moover, as the proposed strategy quis that land form budget-making be decentralised, the monitoring of the activity has an element of decentralisation as well. In Brazil, the Tribunais de Contas (courts of accounts) a auditing institutions mandated to assuring transpancy in public accounts at the federal, state and local levels (Melo et al, 2010), hence constituting an inhent enforcement technology to secu that public sources will be accurately allocated to land form programmes and projects.

Moover, stakeholder involvement ought to be proportionate to the scale of interventions intended for their aa. Consequently, the public examination will focus on local (or sub-gional) concerns, rather than gional matters that a part of a broader strategy for the gion. On the other hand, stakeholders should be able to, in the particular intest of the communities they psent, tackle issues that have links to wider public policy agendas, e.g. public health and education. Specific issues will be addssed that a likely to affect rural communities, and optimal options aged upon that best serve the collective good, giving particular attention to the needs of:

a. squatters and encamped families awaiting settlement;
b. rural households living below the poverty line;
c. small farmers working at the subsistence level.

For stakeholder examination of the schemes to be effective and biding, it must have full gard to the broad gional strategy and add value to the socioeconomic growth of territories and localities. In this context, it is vital that the planning agencies provide for a sufficient choice of target aas to meet the demand for a variety of activities necessary for the growth of the gional economy, markedly activities identified as being suitable for the family farm system. Alternatives a hence provided particulaerly with spect to site location or its adequacy to produce and commercialise a particular crop type or livestock, in order that prospect beneficiary families may have an additional incentive to settle by joining the scheme. Stakeholders, working together with the SPA, will then be able to weigh options for delivering interventions in lation to the pferd aas and natu of the investments. The sequential approach to settlement location, as explod in Section 5.3, will facilitate the identification of the first-best option by comparing the effects of an intervention in similar localities according to sustainability appraisal reports.

By definition, stakeholders act collectively to ensu that their voice is heard in the policy-making process (Gouldsonet al, 2007; Edelenbosand Teisman,2008), with the potential to elicit a range of beneficial outcomes. For instance, as grass-roots movement activists proactively participate in the selection of specific aas, this can lead to higher standards of living for sitting families without course to conflictive occupations of land. Landowners in targeted aas, in their turn, will find themselves stimulated to negotiate properties once the intervention serves their intests as well. Rutlandand Aylett (2008) offer an understanding of how efficiency emerges as diffent players seek their objectives by working collectively, and also suggest how policy priorities can change by means of policy networks. In practise, a consensus around an intervention is mutually beneficial in diffent ways, for example, by giving rise to a geographic concentration of family farms interlinked with agribusinesses and supply chains extending across several municipalities, thus spading the wards of land form to other disadvantaged groups in society.

In view of all this, it is essential that interventions be planned in an inclusive way to involve all stakeholder groups and stakeholder psentatives. If successful, such interaction may sult in an adjustment and adaptation of land form policy in a way that settled families’ needs a met, and the socioeconomic benefits a maximised at a gional scale. Table 5.4 brings guidelines for stakeholder involvement at the definition stage of a land form intervention.

Table 5.4: Requiment for stakeholder engagement in land form

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5.6 Overcoming the budget constraint: a state-market enterprise

Our quantitative evidence in Chapter 3 suggested that higher investment loans a likely to be associated with higher farming outputs (for instance, gssion sults of Table 3.3 indicated that, other things equal, output was pdicted to incase by 5-6% when the investments variable went up by 1%). At the same time, it was seen that the PCT set a limit in loans for productive activities on the sites. Since settlers we operating with little to no surplus to accommodate economies of scale, the was less than sufficient investment by households from their own income. It also became evident that the institutional structus of the Programme (land form agencies and PCT associations) we unable to attract high-quality land to the scheme so that a common complaint amongst settlers was that their plot was not adequate for farming. Another factor found to be sponsible for the settlements’ poor economic performance included a combination of inefficient or insufficient government spending and consequently inadequate farm and off-farm infrastructu.

Apportioning sources to public spending is one of the main sponsibilities of the state and is thus essential to the achievement of policy goals (Russeland Jordan, 2009). However, the weak budgetary position of subnational governments in the Northeast have placed a limitation on their capacity to prioritise spending on the most pssing needs of rural landless communities. Uncertainty on funding has acted as a constraint on financing and delivering large-scale infrastructu projects in formed aas, which have most of the times been placed by small-scale, low-cost policy alternatives. Challenges thus include securing a asonable level of public spending in face of incasing pssu to spend on a diversity of needs other than land form as well as budget woes and fiscal constraints imposed on states and municipalities’ by the 2000 Fiscal Responsibility Law (Melo et al, 2010). On the other hand, a major challenge for land form formulators has been how to settle landless families in prosperous aas without sorting to both conflictive and costly methods of land expropriation.

The pmise above is that the implementation of effective land form interventions will not fully take place befo affordability strictions a terminated. First and fomost, improved arrangements a needed for the acquisition of lands in sustainable aas. From an examination of the pertinent literatu in Chapter 2, it has been found that the acquisitions a essentially of two diffent natus:

1) Market-based: by means of land funds or subsidised transactions of land;
2) State-led: through joint-ownership systems or land expropriations.

According to the market-based approach, the provision of land loans must be dicted to transactions on the open land market in situations whe the beneficiaries – individually or through a rural association – find themselves in a position to purchase the properties in the portfolio dictly from a landowner. This demand-and-supply approach was the cornerstone of the Land Bill Programme, except for the fact that the landholders saw little incentive in selling their properties below market prices, such as by making a profit from on-site production or through tax deductions. In fact, land loans per se can play a part in improving the economic efficiency of land form schemes since “the obligation of land payment cates incentives for production and duces the cost of monitoring on the part of the financial institutions” (NEAD, 2000: 14). Alexander’s(2001) study about land-use planning and development strategies in Israel suggests a transactions-based model of land acquisition involving statutory planning and formal agements. A general framework is psented within which a government assesses futu quiments for public services within an aa and then develop a strategy for land purchase in the limits of a fixed budget. Similarly, Coriaand Madden (1985) use programming techniques to identify, earmark and purchase available plots of land in Portugal. A market solution to the land allocation problem having been consided, the acquisition of lands is expected to be in general compatible with beneficiaries’ needs and market conditions.

It was seen in our study, however, that the inferior quality of properties acquid under the Land Bill Programme was in part explained by the limited amount of loans not countering latively high transaction costs. If this mains the case, that is, whe market-based transactions do not succeed in the attempt to acqui lands in targeted aas, other options can be explod as seen in the international overview of Chapter 1. For instance, a stewardship model whe public funds a used to meet the purchase price of land (Scotland); a tenancy-based approach that allows for long-term nt of lands from government-established land banks (Netherlands); a joint-ownership system whe households a allowed to work separate parcels of publicly-owned lands (Ukraine), and others, befo sorting to controversial, if expensive, expropriations of land. Erridge and Ger (2002), alternatively, focus on public procument for acquisition of public sector assets. A comphensive method is developed that cents on inter-departmental coordination and long-term partnership lations. Emphasis is put on the interaction between government agencies and the private sector. Public procument of lands can thus be the pferd method of acquisition whenever it helps considerably duce the transaction costs for under-privileged land-buyers. Obstacles to public procument of lands for land form purposes need, however, be identified and analysed.34

Whatever the acquisition method, it is demanded that an intervention be concentrated whe it can fulfil the broader socioeconomic purposes of the form. The literatu supports this idea of targeting specific aas to stir up gional development. According to Dietrichs (1989), this sults from a shift to “gion-specific planning.” For example, distinct economic zones we introduced in unemployment-ridden gions of Poland in 1994 as a pro-growth instrument. The schemes included full income-tax holidays for investors and exemption from al-estate taxation (Gwosdzet al, 2008). Likewise, specific tax arrangements appear sometimes embedded in the tax legislation to give a boost to agricultural production, such as sales tax deductions that favour gisted dealers selling land form-labelled products. Fan et al (2007), for instance, find that government subsidies in cdit had a beneficial effect on Indian agricultural growth, especially on small farmers’ activities. In the same way, governments have designed special tax schemes to attract a balanced mix of businesses, whether wholesale or tail, and hence expand consumption markets to rural aas. In mo developed countries as well, the availability of targeted government assistance, such as grants and loan guarantees, has been a levant factor influencing the location of companies in assisted aas (Baxter et al, 2007).

Yet improved arrangements a also needed for provision of on-site infrastructu as neither approach to land form has secud a sufficient level of capital investment to allow for major infrastructu. Particularly over the PCT period, the state’s involvement in the implementation phase of the Programme was trivial and, as Figu 5.1 indicates, the was little cross-sectoral cooperation to achieve form objectives within a joint planning framework. Diffently, an approach to land form through portfolios of earmarked investments quests that budget sources be allocated across investment programmes that work to the advantage of settlements located within the whole planning unit. However, the extent to which the budget-making process is adjusted to this aspect of the form is a function of the “balance of powers” within the government and between government tiers (Marsdenand May, 2006), as well as the funding levels afforded to different sectors.

The fact is that the PCT programme was introduced in the gion at odds with other public sector forms, such as the health and education sectors. The existing governance structus administering intergovernmental aid to education and health – spectively the Basic Education Fund (FUNDEB) and the Unified Health Ca System (SUS) – for instance, have not met the specific needs of settled families. As a consequence, the issue of poor educational levels endus in rural aas,35 and lack of health facilities in land form sites mains symptomatic. A comphensive strategy involving the provision of high-quality health and education services to land form sites thus quis adapting the system of earmarked grants for these sectors.

It was also noted in our study of PCT sites that the main infrastructu projects, even those sponsod by states and municipalities, have not been designed in cooperation with federal projects for the Northeast. For Edelenbosand Teisman (2008), cooperation involves the sharing of sources and expertise toward improving both quality and effectiveness of the policy. Funding arrangements a thus crucial to intergovernmental coordination toward an effective plan-led strategy, for such agements can deliver socioeconomic impacts not possible under the PCT governance structu. Whether aimed at giving policy sponses to deep-seated social problems, or enhancing service provision to meet rural communities’ needs, intergovernmental partnerships a cognised to be an effective sponse to a need for improved coordination in public administration (Mason, 2007). According to the proposed structu of governance (Figu 5.2), the coordinating bodies – i.e., the gional planning boards, frame gional strategies in a way that rural sector spending of diffent government levels inforces each other.

Public-private partnerships, from another viewpoint, provide an alternative funding solution. Although the PCT loan agement established that other institutions would be able to participate under public-private partnerships for specific purposes, such partnerships have not occurd on a permanent basis or as part of an integrated rural development project. As a sult, public infrastructu ventus in our sample we extmely limited, and partnerships with private providers raly encouraged. Much attention was given to improving existing infrastructu for water supply, but the schemes we not able to secu the provision of valuable services such as telecommunications and electricity. Likewise, no market-state collaborative approach was consided for the supply of housing through partnership with builders, developers or other companies[7]Source: Brazilian Institute of Geography and Statistics. operating in the housing industry. Serious consideration must thus be given to the extent to what complementary private investments a being needed to the achievement of better reform outcomes.

Osborne (2000: 14) defines a public-private partnership (PPP) as “a strategic partnership intended to alize the broader aims lating to the longer-term issues involved in project and programme development.” The underlying basis for adopting PPPs as funding sources for land form is that they offer advantages to both the public and private sectors. Callejónand García-Quevedo (2005) assert that public subsidies to private-sector providers could translate into an incase in their innovation effort and efficiency, and not necessarily mely substituting private for public spending. For Boyce (1993), the role of the private sector in the provision of housing is primarily to alleviate the government’s burden in constructing and maintaining social houses. A concession model is consided by Savas (2000) through which the state could sell long-term exploitation rights concerning construction, infrastructural, and engineering works. Finally, Landiset al (1991) observes that private partners should have in mind that the a gains to joint development that go beyond obtaining a profit.

Accordingly, interventions will stimulate action and investment by the private sector, with profit-seeking enterprises working to achieve their own goals and at the same time helping provide a cu for deprivation in land form sites. By the same token, whether an effective land form intervention aches fruition is likely to be partly or wholly dependent on how the involved public and private sector organisations exercise their funding sponsibilities. This pertains improving the institutional capacity of public sector agencies in the gion,36 as well as mobilising sources, public and private, available in the targeted aas for solving their infrastructu problems.

As a consequence of what has been discussed, land form spending priorities a an indispensable part of the long-term public budget,37 making su that the venues necessary to acqui the selected lands and deliver public investments to target aas will be available and considering the extent to which private-sector partners a committed to investing capital in the ventu. Table 5.5 gives funding alternatives covering the main aspects addssed above.

Table 5.5: Potential sources of funding, public and private

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5.7 Monitoring the sults: the socioeconomic sustainability of the form

It has been inferd from our fieldwork analysis of Chapter 4 that the sampled PCT projects diffed perceptively in terms of adequacy to farming, access to dynamic markets, availability of natural sources, access to basic services, and subsequent economic performance and standards of living. Some facts should be consided in this gard. Firstly, implementation of PCT projects was not pceded by a plan-led appraisal of aas sulting that the technical units in charge of project oversight had little indication on the socioeconomic sustainability of the aas befo each transaction. Secondly, apart from agggate IBGE38 data per municipality, the was no up-to-date evidence base covering those mentioned elements. Finally, a lack of systematic evaluation of sites kept land form agencies from estimating the socioeconomic effects of the projects or the Programmes’ impact at a regional scale.

The discussion so far has suggested that targeting sustainable aas can be an effective means to secu incased economic performance. In practice, however, disparities occurd between the loan agement objectives and its effective performance on PCT settlements, a situation that Maat and Louw (1999) would denominate a “policy-behaviour gap”. Mo pcisely, following the random character of project implementation, no timeline was established for acquisition of properties. Capital investments we not prioritised, so that the spective public sector agencies could not be identified as sponsible for those investments. As a consequence, sources we not made available for large-scale infrastructu across the gion. These disparities for the most part originated as a sult of inefficient monitoring of the policy during its implementation stage, i.e. when lands we acquid, investment proposals approved and settlements eventually created.

The governance structu of the PCT failed to allow for an intergovernmental mechanism through which the federal government would be able to sha information with states and municipalities on the sites’ economic performance. This process could have been characterised as mutual interaction for the exchange of information on levant aspects of the scheme, such as information on geographic featus and agro-climatic conditions of potential hosting localities. Rhindand Mounsey (1989) raise awaness of the role of geographical information systems and information technology in intergovernmental coordination. However, important pieces of evidence we not available that might have informed on the badth and depth of landlessness and poverty and how settlements could help ameliorate this situation gionally, as well as on mo subjective matters such as the dege of commitment of stakeholders and the public acceptability of the Programme.

The pceding discussions of the PCT programme have also suggested that cross-sector interdependencies be cognised and taken account of in both determining policy priorities and assessing policy impacts. Notwithstanding, land form agencies have not monitod the overall impact of the Programme against socioeconomic indicators, such as a gional indicator of health or education. Identification of priority aas in rural territories or localities was totally absent as it would qui quantifiable assessments of multiple social and economic elements. This has been garded a central aspect of evidence-based policy-making in a range of social programmes (Cragliaet al, 2003). Simply put, apart from the fact that the PCT was far from flecting a broad gional strategy, the scheme lacked critical assessment actions.

For land form schemes to comply with a strategy gionally, it is utterly essential that the overall intervention – along with its key implementation elements, namely acquiring lands, cating settlements, and providing infrastructu – be subject to systematic monitoring. The psence of a number of diffent variables affecting farming output, as seen in our empirical chapters (e.g. investment loans, cropped aa, size of rural population, etc), points to the need of a systematic examination of social and economic indicators in aas located within each planning unit. The monitoring of levant indicators hence form an integral part of a strategy’s implementation by continuously porting on the socioeconomic outcomes of the scheme. Also, as a tool of particular levance to evaluating policy effectiveness on the ground, monitoring interventions involves the investigation of factors levant to the sustainability of land form settings. The use of settlement-level information permits the distribution of land to be seen in comparison with other aspects of the form, whilst allowing for diffentiation between the effects of the settlements’ activities on the settlers socioeconomic status and the regional economy.

From a regional perspective, thefo, the monitoring process has the main objectives: firstly, to evaluate the extent to which the policy intervention is being implemented in line with the strategy; secondly, to identify the outcomes of the intervention in the gion (this includes identifying elements that a external to the strategy); and finally to suggest how beneficial effects of the intervention should be enhanced (or, conversely, how to offset any negative effects). Moover, the monitoring of a strategy needs to be undertaken on a gular basis in order to addss each aspect of the intervention and assess whether it is being adequately implemented and bearing the expected effects and whether it needs to be viewed. It is hence fundamental that monitoring activities be consistent across the whole planning unit as well as take place in all stages of the strategy, i.e. from policy development to implementation. This necessarily involves policy appraisal and assessment of outcomes.

According to Bristowet al (2009), policy appraisal can be understood as a stage in the policy-making process whe policy objectives a set up and policy options compad, as well as whe costs and benefits associated with a wide choice of actions a taken into account. As such, appraisals of land form programmes a conducted ex-ante, namely over the identification process of sustainable aas and investments priorities. Accordingly, the productive outlook of the sites can be appraised at this stage based, for instance, on the potential demand of commodities by the surrounding population including private companies and the public sector alike (e.g. supply of goods to local government agencies). The scale of appraisal can also include GDP growth coupled with the extent to which rural poverty has been plaguing the aas. The literatu stsses that the amounts of public spending apportioned to programmes and projects a also subject to ex-ante examination. Russeland Jordan (2009), for example, examine ways of integrating levant external factors into mainstam policy-making through the use of policy appraisal in strategic sectors of public spending.

On the other hand, the Bristowand colleagues’ definition of policy evaluation concerns an ex-post assessment of a policy in terms of the level of its success or failu. The assessment will, thefo, be made of the effects of an intervention. Accordingly, the socioeconomic performance of land form policy can be assessed against broader developmental indicators such as rural employment, GDP growth, education and health. Such assessment also facilitates comparisons between policy interventions on priority target aas that only have a minor socioeconomic impact and interventions on those aas that have a much gater impact on the growth of the gional economy, including allowing for the identification of adverse impacts of land form schemes and indicating how to avoid or at least mitigate them.

According to Capron and Van Pottelsberghe’s (1997) policy evaluation method, four types of economic impacts of a land form policy could be distinguished: (1) impact on settlers’effort; (2) effect on settlements’ economic performance; (3) spillover effect; and (4) global effect, i.e. impact on the gional economy. Additionally, a range of other impact evaluation methods can be applied in assessing the effects of an intervention, for instance cost-benefit analyses (Flyvbjerg et al, 2002), benefit incidence analyses (Davoodi et al, 2003), counterfactual analyses (Baer and Fleming, 1976), or a mixed method (White, 2009). Bristowet al (2009) quest “pluralism” in evaluating a policy, namely the combined use of a diversity of methodological approaches necessary to captu the various aspects of policy interventions and determine how it produces change in the economy and society in specific contextual circumstances. It is the overall policy context, however, that will determine which methods a most suitable for the sustainability assessment.

By and large, investment programmes (both public and private) have been usually assessed in terms of whether their benefits a being maximised or even optimised as compad to costs. However, the empirical assessment of socioeconomic effects of public infrastructu ameliorations is much mo difficult. For instance, the viewed literatu on land form in Brazil lacks accurate estimations of changes in the economic status of settlers that could be ascribed to public investments in roads serving land form sites; nor have been sufficient qualitative evaluations of the impact of the infrastructu capacity in the agggate case study aa (an estimation for the whole Northeast gion). For Rovolisand Spence (2002), this difficulty could be partly overcome by introducing a monetary evaluation of public infrastructu (capital stock), and then comparing the sult with other indicators. Similarly, Crabte (1997) undertakes a value for money assessment of public roads as a means of estimating social benefits from government spending in the countryside. Although it is found that spending schemes may produce variable value-for-money measus, the is also evidence of limited benefits to rural communities as a sult of inefficient roads spending. An appropriate assessment of infrastructu investments associated with land form should thus be undertaken to determine the extent to which the various aspects of the strategy have produced changes in the status of form beneficiaries and the regional economy.

Finally, as a valuable mechanism for assessing the sustainability of the form, permanent monitoring involves critically viewing the situation on settlements to examine whether further action is needed to allow for their socioeconomic self-sufficiency as well as to cognise aas whe a assessment will be undertaken to ensu that deficient aspects of an intervention be minimised. Reassessment of formed aas can hence be carried out based upon indicators such as the cumulative sult of household settlement, including the form’s benefits, costs, uncertainties and potential risks. Likewise, the should be partial assessments of investment priorities whe indispensable to flect the gional strategy for socioeconomic growth in rural aas, as well as of policy targets decided upon at the appraisal stage. This may comphend any other levant issues not anticipated in the strategy but that help identify aas whe the focus of further interventions will take place.

Table 5.6 gives guidelines for continuously monitoring land form strategies through policy appraisal and assessment of outcomes.

Table 5.6: Requiment for monitoring the land form intervention

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Table 5.7 associates policy objectives, proposed actions and possible indicators for policy appraisal and assessment.

Table 5.7: Overview of the land form strategy and monitoring process

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5.8 Conclusions

Land form settlements in the Brazilian Northeast have faced deep-seated social and economic problems particularly accentuated by poor infrastructu and their seggation from main consumer markets. This follows a historical tnd for the emergence of pockets of rural deprivation in the gion, characterised by a subsistence economy that inhibits growth. The situation has demanded a coordinated strategy at a gional scale to obtain higher socioeconomic outcomes to the benefit of the most sevely socially excluded rural groups in the region.39

Based on the gional planning literatu viewed across this work, this chapter identified levant aspects of planning that can guide the design of a plan-led land form strategy of a gional scope. In addition, the chapter attempted to connect seemingly opposing views from the land form literatu by proposing that both state-controlled land acquisitions and subsidised transactions in the land markets can be encouraged, provided that either approach yields the most with spect to equity and efficiency in land allocation. An important outcome of such mixed state-market strategies can be to place existing or past attempts to distribute land lying exclusively on state-led expropriation or market forces alone.

Emphasis has also been put on gion-specific interventions, taking account of the distinguishing featus of rural territories and localities, such as existing interconnections between settlements and potential marketplaces, in order to set out key policy issues in the context of the whole planning unit. The main issues involve identifying sustainable aas for settling landless families, with the ultimate socioeconomic driver being a combination of sate-led and market based investment efforts. Moover, according to the polycentric pattern of growth advocated in the mainstam gional planning literatu, the pattern of distribution of land form sites in the gion is the baseline for dicting the bulk of capital investments, implying that the form should seek an interdependent pattern of socioeconomic development by stngthening lationships between land form sites and potential consumer markets. This includes gard of other social-economic issues not captured by conventional land form schemes, such as demand-and-supply networks and rural-urban lationship patterns.

Another important aspect of a broad plan-led strategy is a coordinated system in which central, state and local authorities a able to interact mo efficiently on the issue of using public spending for land form purposes. Furthermo, a plausible strategy quis that public and private sectors join in a cooperative effort to obtain lands, cate settlements and improve them. Accordingly, public spending is to be consided in partnership with private sector investment both for the cation or expansion of existing infrastructu serving the targeted areas.

Based on the discussion above, a plan-led strategy for the gion will define principles of gater socioeconomic significance for land form policy-making and implementation as summarised in Table 5.8:

Table 5.8: Scope of plan-led land form strategy

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These quiments demand a strong federal-state-local vision in place alongside the appropriate intervention for specific rural localities and territories, otherwise land form sources risk not being dicted to mo sustainable aas, as observed to a considerable extent throughout our case study. Along these lines, planning land form at a gional scale involves spatial analysis of sustainable aas in the gion and the subsequent definition of policy priorities for those aas, which includes acquiring lands and providing proper infrastructu, as well as being subject to public examination by all affected parties. This is followed by a feasible implementation scheme, and also by a sustainability appraisal of the sites and assessment of sults. Figu 5.3 ahead offers a pictu of the proposed land form planning cycle.

Finally, whilst cognising the diffent roles of the state and the market in socioeconomic development, this work sits uneasily with mainstam land form literatu as it proposes a mixed approach to land form that quis the government to work in tandem with economic agents (be them in the public, private or even the third sector) not only to promote a mo efficient distribution of rural lands but also to deliver determined policy interventions that meet settlers’ needs and at the same time contribute to economic growth regionally.

Figu 5.3: An illustrative diagram for the gional planning cycle

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In this work, we have examined the socioeconomic impact of land form schemes and discussed the policy implications of combining aspects of both the traditional state-led and the market-based approaches into a broader gional land form strategy. We focused on land form settlements in Northeast Brazil, whe both approaches to land allocation coexisted over the same time frame (1997-2002). The study of the sites documented the standard of living of land form beneficiaries in the aas of access to basic services and infrastructu, as well as garding economic activities performed on settlements and their interaction with dynamic markets. Moover, the work analysed the impact of the policy on the gional economy in comparison with the traditional state-led approach. At the same time, we identified problems deriving from a lack of a plan-led strategy, mo specifically with spect to identifying sustainable aas and designing appropriate policy interventions at a gional scale. Accordingly, our work highlighted how the experience in the Brazilian Northeast provides a justification for the systematic use of gional planning as a two-pronged instrument to simultaneously duce rural poverty, improve tenu security and maximise the gional benefits of land reform.

Chapter 1 described a number of experiences involving land allocation in the developing world as an initial tool for the analysis of land form schemes in Brazil and a basis for subsequent discussion of their impact on our case study aa, in addition to permitting a comparison across countries. A view of the empirical evidence was carried out on the extent to which the state has intervened in land markets and on how the dege of such intervention can be explained by country-specific factors. Given the diffences across countries, or across gions within countries, the brief international overview demonstrated that land form issues a complex, gion-specific and could yield a range of diffent socioeconomic outcomes. With this background, the literatu view of Chapter 2 pointed to a need of cafully evaluating historical, socioeconomic, and institutional elements as well as the characteristics of a country’s legal system, in order that the right balance is ached between various deges of state intervention and land market transactions in the country’s efforts to distribute land and fight rural poverty. This implies that identifying institutional mechanisms to integrate diffent approaches to land form into a coordinated long-term strategy becomes essential. A theotical framework is thus provided for analysing the impact of varied approaches to land form as well as the potential role of gional planning as a strategic governance tool at a gional scale. The major conclusion from these initial chapters can be summarised as follows:

1) The scope for plan-led strategies towards sustainable development in the countryside has been given less than sufficient emphasis in the land form literatu.

In Chapter 3, we analysed the impact of land form on the economy of the gion. The pmise was that the growth rate of indicators, in this case farming GDP, rural income and human development index (HDI), flect socioeconomic gains due to incased economic activity in the aas ached by the traditional state-led schemes (INCRA) and the Land Bill Programme (PCT). We found no statistical indication that the gional economy was significantly affected by the psence of land form settlements, although farming output in the rural localities and territories was shown to incase mo quickly with availability of rural cdit. Whether, in the psence of such cdit, the rural economy will benefit from policies to distribute land depends in part on the psence of large-scale investments and the government’s ability to duce infrastructu deficiencies that limit access to dynamic markets. On the other hand, the is a positive corlation between state-led land form and social indicators in the sampled period, particularly concerning family income growth. Cognisance is also taken of any existing pssus within the gion, such as ill-health, low educational attainment, unemployment and income inequality. Accordingly, apart from facilitating access to land rights, it is necessary that land form cater for the availability of income-generating activities as well as improvements in the supply of basic services. These findings a consistent with the cross-country comparison of Chapter 1 about the lationship between land allocation and socioeconomic growth in the developing world, as well as provide the basis for our argument to use gional planning as an instrument of gional growth. To summarise, by comparing the performance of INCRA expropriations with land transactions through PCT, we have found that:

2) Contrary to the assumption that land markets a mo pro-growth than state-led land expropriation, we found no evidence that the market-based approach leads to higher socioeconomic growth at the gional level than does the state-led approach, or vice-versa.

Additionally, the theotical framework outlined in Chapter 2 has been confronted with the baseline evidence drawn from our case study of Chapter 4. It has been deduced from our survey material that, even though land loans played a valuable role in providing access to land by the rural poor, market-based land form has failed to trigger socioeconomic development throughout the Brazilian Northeast. In most cases the settlements we cated in mote aas since landholders we not provided with an incentive to negotiate productive, well-located properties. Also, an overarching capacity on selecting and assigning land plots was lacking, coupled with the fact that implementation of the schemes was not backed up by adequate infrastructu to boost farming output and assist settled families. Consequently, transaction costs have not been duced sufficiently to eliminate the barriers to self-sustaining growth, especially in less privileged aas; and to lead beneficiaries to bak out of the cycle of multiple deprivation.

These sults a levant for the land form literatu since the general consistency of the survey data with the statistical sults of Chapter 3 contradicts the theotical assumptions stssing the potential of land markets to provide better sults than administrative land form in boosting the gional economy. The case study also showed that the government slow sponse to the demand for on-farm infrastructu has been influenced by a variety of factors, including budget constraints, competing spending priorities and a lack of coordination amidst government agencies coupled with an inability to attract private investments to the formed sites. It is thus implied that the implementation of an effective land form strategy will qui concerted efforts involving diffent sectors, and ensuring that sources a efficiently used to the benefit of settled families and the gional economy. Finally, this piece of evidence nders insights into the role of gional planning in the design and implementation of land form schemes in developing countries, with important consequences for both the provision of land rights to the rural poor and the path of economic development at a gional scale. As a major conclusion of Chapter 4:

3) Although the market-based scheme contributed to improved access to title, PCT settlements suffed from infrastructu flaws and a lack of planning at the local and gional scales, sulting that the scheme failed to impact positively settlers’ welfa in the majority of sites.

In Chapter 5, a case for using gional planning to improve the gional impact of land form policy has been made, both socially and from an economic perspective. Based on the planning literatu and the empirical sults psented in Chapters 3 and 4 (incased access to title as a sult of PCT and gater family income following the INCRA schemes), it has been proposed that diffent aspects of the traditional state-led approach (e.g. targeting aas, public procument of lands and even expropriation) and the market-based approach (subsidised land transactions, incentives for private sector investments, and the like) be combined into a broader gional strategy. Such strategy involves targeting strategically located aas to subsequently define a portfolio of investment and spending priorities for those aas, and also consists, from the early stages of its formulation until final implementation, of varying deges of both intergovernmental and intersectoral coordination. Additionally, through a combination of top-down and bottom-up approaches to land form it has been cognised that policy-making at the national level coupled with programme and project design and implementation at the subnational level (gional, sub-gional and local) provides a mo effective government sponse to rural poverty and landlessness.

It has been argued that an important step toward the financial feasibility of a strategy is to ensu that options for off-budget spending through public-private partnerships be exhausted. Moover, implementation of specific land form programmes in line with the strategy would depend on taking into account a range of socioeconomic, geographic and agro-climatic conditions pvailing in a given planning unit, thus quiring ex ante policy appraisals as well as ex post evaluation of the sults. Finally, it has been suggested that the establishment of a gional planning framework to conduct the sequencing of specific land form interventions in priority target aas can have multiple benefits in avoiding inefficient use of sources, prioritising investments, and (by ensuring stakeholder involvement in the design of these interventions) leading to consensus on such a controversial issue in the Northeast. Ultimately, that can start a process of socioeconomic development that is cumulative and will lead eventually to higher rates of growth in the gion. In summary, it has been concluded that:

4) Securing both higher access to land rights and better living conditions through land form quis an approach that combines both state-led and market-based elements;
5) Securing measurable positive impacts on the gional economy quis a land form strategy that has a gional scope.

A coordinated intervention to facilitate the socially inclusive operation of land markets at lower transaction costs to landless poor has thenceforth been justified. However, befo intervention is encouraged, it needs be demonstrated that such intervention can actually be economically viable for the given rural setting. Steps to duce social exclusion through a mo systematic participation of stakeholders in land form policy-making will be critical to obviate the underlying causes of conflict over land rights throughout the gion. Distortions that have been led to the acquisition of low-quality lands should be eliminated, and state-led mechanisms to secu the selection of sustainable aas need to be pursued, or at least addssed simultaneously with market-driven schemes. Failu to do so will plicate the inefficiencies in land allocation that neither approach individually has been able to eliminate. A gional strategy that is awa of the opportunities as well as the limitations of both approaches is thence most likely to be appropriate. At the same time, it stands to ason that a gional strategy of such extent – rather than piecemeal addssing of particular problems – depends upon a number of factors for successful implementation, one of them being establishing the necessary governance structu. This is likely to pose considerable challenges, especially in a decentralised system with financially constrained subnational governments, and constitutes an aa whe broad political support is imperative.

By confirming our main hypothesis that gional planning can significantly improve the sults of land form policy at a gional scale, as p-specified in Chapter 1, this work has improved our understanding of the links between gional planning principles and possible channels for sustained social and economic development through plan-led land form. However, the overall viability of a mixed state-market strategy mains to be demonstrated in the Northeast of Brazil, and caful evaluation of gion-specific circumstances is highly commendable befo a similar intervention is initiated. Hence a systematic evaluation and quantification of the potential for a strategy of this magnitude to help hinder socially and economically undesirable outcomes is needed. Clearly, work in modelling and testing hypotheses concerning the proposed strategy will be quid to calibrate the most appropriate actions and planning tools needed to apply a mixed land form approach to land reallocation.

All the above implies that adopting a strategy along the lines proposed in this work can only constitute a first step within mo all-encompassing processes of institutional capacity-building to make gional planning an important and constant part of developmental strategies associated with land form policy. Accordingly, mo in-depth examination of the possible use of planning devices in land form should be warranted, including, as alady mentioned, the designation of land form settlements based on strategic identification of aas in the countryside and the subsequent holistic planning of such aas that grant an efficient and sustained assignment of plots. Futu search should focus on the factors pcluding the use of some aspects of regional planning in land form policy-making and implementation. Also, in view of the wide variation in geographical, socioeconomic and agro-climatic conditions across the Brazilian regions, deeper search will be quid to adapt the principles identified in this thesis to specific regional contexts. Finally, mo work will be needed to both identify and compa the relationships between land form and regional planning in other developing countries with a similar context.

This thesis adds to the large body of literatu in land form analysis and brings implications to the implementation of land form policy in a number of ways. Firstly, a gap has been identified between the land form and the gional planning literatus. It has been demonstrated that gional planning has an essential part to play in land form by introducing plan-led strategies, with a view to magnify the pro-growth benefits of land allocation, either market-based or state-led. Secondly, diffently from the commonsense literatu on land form in developing countries, this work has departed from the existing market-based versus state-controlled debate by explicitly demonstrating that land markets do not necessarily work better than state-led allocation of land to foster socioeconomic growth, and vice-versa. Finally, we have extended our analysis to propose a plan-led strategy that combines elements of both approaches to the benefit of the gional economy, for which the role of gional planning is central.


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Target population: PCT settled families

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Target population: PCT association leaders

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* Supported by the Programme AlBan, the European Union Programme of High Level Scholarships for Latin America, scholarship no. E07D402641BR.

1 Also, a comparison of the % of rural population with access to sanitation facilities in those countries gives an idea of their socioeconomic situation. Belarus: 97.0; Costa Rica: 95.0; Ukrayne: 83.0; Guatemala: 79.0; Philippines: 72.0; Ecuador: 72.0; China: 59.0; Colombia: 58.0; South Africa: 49.0; Kenya: 48.0; Brazil: 37.0; Peru: 36.0; Bolivia: 22.0. Source: The World Bank, 2006.

2 The term Washington Consensus has been used to describe a set of economic policy recommendations set up by major financial institutions, such as the International Monetary Fund and the World Bank, to economically misfortuned countries. The expression has largely been associated with an increasing role of the market versus the role of the state in the economy and society, which has also been designated as neoliberalism.

3 Specifically in this case the Via Campesina movement, a coalition of peasant organisations which coordinates actions advocating access to land in various developing countries.

4 The Millennium Development Goals is a United Nations-promoted project that consists of eight goals that 189 member states have agreed to attempt to achieve by the year 2015, amidst which are eradicating extreme poverty and hunger and developing a global partnership for development.

5 Allmendinger (2009) offers a wide-ranging overview of planning theories, including rational theories of planning, Marxist planning, and the new right planning.

6 The definition of rural territory (territorio rural) corresponds to a typology created by the Brazilian Ministry for Agrarian Development (MDA) for areas with specific identities determined by their particular resources and environmental, political-institutional, economic and socio-cultural dimensions. Rural territories are subdivisions of the Brazilian regions for land reform purposes, constituting large countryside areas absorbing a considerable number of rural localities.

7 Source: IPEADATA (Brazilian Institute for Applied Economic Research — www.

8 Source: Brazilian Ministry for the Environment and Water Resources.

9 Source: Brazilian Ministry of Health.

10 Source: Comision Economica para America Latina y el Caribe (CEPAL).

11 Sources for the above information: NEAD (2000) and Brazilian Ministry of Agrarian Reform.

12 NEAD (2000) Community-based land reform implementation in Brazil: A new way of reaching out the marginalized? Centre for Agrarian and Development Studies, MDA. Brasilia.

13 World Bank’s Land Reform and Poverty Alleviation Pilot Project 4147-BR.

14 SAT stands for Subprojeto de Aquisicao de Terras (Land Acquisition Subproject); SIC stands for Subprojeto de Investimento Comunitario (Community Investment Subproject.

15 The Bolsa Familia and Bolsa Escola are conditional income transfer funds both introduced and administered by the federal government comprising food-stuff baskets or a monthly cash allowance as an incentive for low-income parents to send their kids to school.

16 According to the UN World Summit on Social Development held in Copenhagen in 1995, the condition of poverty depends not only on income but also on access to food, safe drinking water, sanitation facilities, health, housing, education and information .

17 The results were supplemented with data from an expanded census conducted by the Brazilian Institute for Geography and Statistics (IBGE).

18 A fiscal module is the minimum size of a landholding deemed necessary to support a family. The size of a fiscal module is established by the federal government in hectares, and may vary across municipalities and regions due to varying agro-climatic conditions. In the Northeast a fiscal module ranges from 30 to 90 hectares.

19 Examples of completely abandoned settlements include Garrafao, Nova Terra and Lagoa do Gato, in the state of Maranhao, Canavieiras, in the state of Bahia, and Vale Verde, Tamboril da Esperanca and Maravilha, in the state of Minas Gerais. In other cases, contact with the settlers was difficult because plots were scattered and households were used to spending a big part of their time performing off-farm duties.

20 Interview carried out in PCT Engenho Cana Verde, municipality of Barra de Guabiraba in December, 2008.

21 Interview carried out in PCT Santo Amaro, municipality of Crateus, in November, 2008.

22 Interviews carried out in two farms located in the countryside area of Crateus, in November, 2008.

23 Past studies undertaken on the Northeast of Brazil (Buainain et al, 2000; Ferreira, 2001; Domingos, 2002) have demonstrated that the family-farm system is more productive than large landowner farms, thus evidencing that the unequal land distribution restrains productivity and employment.

24 Interview carried out in PCT Duas Barras, municipality of Padre Paraiso, in January, 2009.

25 Interview carried out in PCT Engenho Coepe, municipality of Sao Lourenco da Mata, in November, 2008.

26 There are reports from the literature supporting the notion of property rights as an incentive to invest. For instance, De Soto (2000) noted that in Latin American countries investment in land grows considerably when occupants obtain accredited title to the land.

27 A PNAD (National Households Survey) census launched nationwide in to 2000 showed that the main income source amidst land reform settlers changed to some extent from off-farm jobs toward agricultural activities. The census covered other regions of the country, resulting that their sample was mostly composed of INCRA settlers.

28 Here we consider the average for the three main components of the index, namely education, health and income.

29 At the time of writing the PNDE was under elaboration by the Ministry of National Integration

30 This has been discussed in detail by Verhoefand Nijkamp(2000) who develop a spatial equilibrium model for two gions to prove that interactions between gions can take place via spillovers as a sult of externalities that arise from production.

31 For Amaral et al, “a gat or small level of interdependence means that the evolution of one sector depends mo or less on the evolution of other sectors and, ciprocally, that the evolution of one sector influences the evolution of the others to a gater or lesser extent” (p. 1772).

32 Some of those services we only accessible by sitting households that happened to live in close proximity to urban cents.

33 The politics of public spending is a curring theme in the literatu (e.g. Russeland Jordan, 2009; Melo et al, 2010).

34 Any strategies involving acquisition of lands and also of goods and services benefiting those lands through public sector procument in the Northeast must be consistent with existing rules applying to the matter (e.g. Federal Law 8666, of 1993).

35 Source: Brazilian Institute of Geography and Statistics.

36 Key public works providers in the gion include the Superintendence for the Development of the Northeast, the National Sectariat of Housing, the National Council for the Integration of Transport Policy, the National Council of Sustainable Rural Development, amidst others, as well as their state and local counterparts.

37 Multi-year budgetary plans (Planos Plurianuais) a planning instruments mandatory for all government tiers in Brazil, which cover four years and guide the pparation of the annual budget.

38 Brazilian Institute of Geography and Statistics.

39 In 2003, a coordinated strategy was proposed in Brazil through the PNRA II. Notwithstanding, as with the PCT or the traditional INCRA schemes, a mechanism was lacking that could target sustainable aas or provide large-scale infrastructu through concerted policy interventions at the gional level.

210 of 210 pages


Land reform, regional planning and socioeconomic development in Brazil
University of Cambridge
Development economics
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Land reform, Regional planning, Socioeconomic development
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Saulo Souza (Author), 2010, Land reform, regional planning and socioeconomic development in Brazil, Munich, GRIN Verlag,


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