Modernization & Formal Economies / by Simmon Li

An exploration of land reform & understandings of development

[Ed. Submitted for a course on international development]

The relationship between land reform and development has been a story of constantly increasing complexity. Through the cases of Brazil, Kerala, and Zimbabwe, issues of land reform and development will be critically examined and it will become evident that the historical relationship between land reform and development—that is, capitalist development—is situated in the wider process of modernization. Historically, the relationship between land reform and development has been one of linear progression, and it continues to be the case. The case studies all show, in one way or another, the persuasiveness of the linear relationship between land reform and development. Brazil offers the paradigmatic case for earlier understandings of development and its relation to land reform. The orthodoxy of linear progression from land reform to fuller development becomes more complex as we approach the cases of Kerala and Zimbabwe. The underlying relationship of land reform and development vis-à-vis modernization remains an animating force in all of these cases, but it becomes evident that understandings of development and in turn methods and recommendations of development have changed. This paper will attempt to show that the process of land reform is still intimately connected to idealized development and that modernization theory continues to be the path by which mainstream understandings of development travel. Further, the paper will attempt to draw attention to the broader process of formalization that underpins even the most nuanced understandings of the modernization theory of development. It will also be shown that modernization theory has taken some critical reactions seriously and sought to address its own shortcomings. Through the historical survey of the three cases, this process of formalization can be followed by looking at the understandings of development that are prevalent, the relationship between land reform and development, and the measures that have been used to quantify this understanding of development. The implications in drawing attention to this larger process of formalization will be explored vis-à-vis strategies of development by looking at the problem of favelas and the case of the urban poor in Brazil. It becomes obvious, even in this context, that land reform remains highly relevant as a tool of development.

Before embarking on any task of understanding how land reform is impacted by broader understandings of development, it is instructive to define what land reform as a tool seeks to accomplish. The main function of land reform, in all understandings of development, is to redistribute land so as to have it become productive. The mode by which land becomes productive has been subject to much change, but access to land remains highly relevant and contentious. (El-Ghonemy, 2010) In his appendix, Lipton provides a contemporary understanding of land reform’s role in development: “[it is] legislation intended and likely to directly redistribute ownership of, claims on, or rights to current farmland, and thus to benefit the poor by raising their absolute and relative status, power, and/or income, compared with likely situations without the legislation.” (Lipton, 2009, p. 328) This definition of land reform is particularly relevant within the theory of modernization where a regime of property rights, the judiciary, and the state all play a part in securing this institutional arrangement. Of course, this approach to land reform has its roots in the historical trajectory of the colonial and post-colonial state experiences. (Binswanger-Mkhize & Deininger, 2009) While Scoones, et al. offer us 4 broad theoretical perspectives from which to approach redistributive land reform, it is clear that most prognoses are based on a modernization theory of development in which an economy moves from the traditional to the modern. (Rostow, 1960) While alternative understandings of development may lead to different functions and understandings of land reform, it is clear that the linear relationship between land reform and development has become the normative path of development. Even views that reject modernization place heavily emphasis on land. (Scoones, et al., 2010) Following the classic modernization program, a country embarks on land reform as the first step of development, eventually leading to heavily capitalized farms which free up labour for the modern sector of the economy and in turn fuel more “modern” forms of employment thus attaining so called developed status.

Brazil, in many ways, is the paradigmatic case that serves to illustrate how powerful the modernization narrative of development has become. Brazil, following the Washington Consensus, implemented a program of modernization which included a heavy focus on the issue of land and ownership/access. In parallel to land reform, a process of market liberalization and urbanization also took place in an attempt to generate space for a modern economy to emerge. This follows the classic steps of take-off that have been persuasive in development literature. (Rostow, 1960) Through this linear approach, small-holder farms were consolidated into larger operations. Petras & Veltmeyer (2003) point out that concentration of landownership, while already high before the Cardoso regime, increased during this period. This increase in land ownership colluded with the regime’s inducing of winners and losers through selective tax incentives encouraging large scale, industrial cash cropping for exports. (Petras & Veltmeyer, 2003, p. 77) As some authors point out, the pursuit of this program of modernization and economic development was key to the international success of the Cardoso regime. (Petras & Veltmeyer, 2003) Through this export-led model of economic development, the Cardoso regime created a bifurcated economy, with “one export oriented and dominated by big capital, [and] the other inwardly oriented and formed by a myriad of small and medium-sized producers and business operators.” (Petras & Veltmeyer, 2003, p. 73) From this critical perspective, the process of modernization is well documented by Petras & Veltmeyer and shows how Brazil followed the contemporary orthodox methods of development.

It is important to note that the Petras & Veltmeyer assessment of Brazil’s program of development is anachronistic. While their critical perspective is appreciated and extremely relevant to development studies today, it remains an assessment of a development program in the context of more nuanced and deeper understandings of what development is. (Petras & Veltmeyer, 2003) Such a critical review bodes well for development studies and speaks to the strength of this change in understandings of development and the impacts on issues of land reform. The normative shift can be easily seen in the Navarro chapter of the 2009 World Bank book about agricultural land redistribution. (Navarro, 2009) Making the case that expropriation of land to feed into a small-holder system of agriculture tends to improve the lives of people, the chapter recommends that land reform in Brazil continue to promote rural development through fostering access to smaller plots of land for the poor. (Navarro, 2009)

Historically speaking, however, development was concerned strictly with the macroeconomics of the modernization project. This included processes of industrialization that eventually transformed the agricultural sector in Brazil. Many of the studies and policy discussions at the time focused on the economics and politics of agrarian reform from the perspective of modernization. (Smith, 1964) Within the historical context, this econometric focus is understandable. The program of modernization reflected important ideological and theoretical biases that were prevalent at the time. The Washington Consensus, the need for strong states—as opposed to democratic states,―and the emergence of neo-liberal economic policy built the foundation that enabled Brazil’s program of reform. Since reform and development, it has become clear that the narrative and normative standard of the modernization theory of development still holds much sway. Biases towards the economic side of development are plainly evident in the discourse of the time, and speaks directly to the modernist project: efficiency and productivity. (Smith, 1964) Arguably, Brazil has reaped the benefits of “joining the club,” so to speak, and now not only wields international clout as a part of the BRICS bloc, but is also a source of growth in the globalized economy that has been shaken to its very core. (United Nations Statistics Division, 2011)

The case of Kerala complicates the understandings of the relationship between land reform and development. In a way, the case of Kerala confirms the linear relationship between land reform and development, but does so in an implicit way. Kerala’s land reform project was initiated in the same period of Brazil’s project of modernization. Like Brazil, Kerala inherited a legacy of highly concentrated land ownership. (Oommen, 1971) Kerala embarked on reform following much the same model as Brazil, using tools of reform such as land holding ceilings, tenancy reform, and others. (Lipton, 2009) The key difference, however, was that Kerala had a deeper legacy of democracy than Brazil did. (Moolakkattu, 2007) Moolakkattu argues that it is, in fact, this deeper democratic practice that impacted the process of land reform and put Kerala on a different path from Brazil. (Drèze & Sen, 2002) As a complete contrast to the Brazilian case of top-down land reform, there appears to have been a truly participatory process of land reform. (El-Ghonemy, 2010; Oommen, 1971, p. 103) Kerala, then, seems to confirm the progress oriented model of development that Brazil exemplifies precisely because it failed to realize economic growth by following a different model of land reform. Land reform, following the model of large, capital intensive farming, was believed to lead linearly to development. It is important to recall the context in which reform happened. Brazil’s reform was initiated by the international community and realized through a program of structural adjustment. (Petras & Veltmeyer, 2003) Kerala’s experience of land reform followed a completely different causal path. Not surprisingly, this led to a different outcome. Land reform in Kerala, though initiated with the project of modernization in mind, was subject to a much more substantive democratic involvement by the people and was unable to portion the large tracts of land needed for capital-intensive farming. (Moolakkattu, 2007; Oommen, 1971) While one would expect land reform in Kerala to generate economic development, as per the modernization model of development, this was not the case. This is especially curious because land was well suited for the path of agricultural development. (Meyer & Brysac, 2011, p. 64)

While understandings of development were similar to those in the case of Brazil, the paths by which these two cases took differs due to the political and ideological contexts in which reform took place. What captures the imagination about the Kerala case is the anachronistic analysis of development experience under a more nuanced understanding of development, which includes measures of human development. Kerala’s 2005 Human Development Report points to the disparity between the economic development indicators and the HDI measures and discusses the disconnect that these two variables show. (Centre for Development Studies Thiruvananthapuram, 2006) While not impossible, the logic of modernization suggested that economic development and human development went hand in hand; particularly that economic development would lead to human development. The Kerala case raises questions about the assumptions of modernization. (Tharamangalam, 2010) Venkatraman references Amartya Sen, the famed development economist, who points to Kerala’s development experience as challenging the whole pathway of development that modernization recommends. (Venkatraman, 2009) The case of Kerala, as Venkatraman, points out is less of a mystery than initially eluded to, and in the end, turns out to mostly confirm the path of modernization theory with a few important differences. Venkatraman points the apparent paradox of Kerala and explains it using triangulated data. (Venkatraman, 2009) It is suggested that there must be an under-reporting of income that is derived from informal arrangements of income. (Venkatraman, 2009) In this regard, the development experience of Kerala is not one that can be replicated easily, nor is it generalizable. The paradox of Kerala, it turns out, is not so much a paradox, but a story of untold stories. (Venkatraman, 2009)

To this end, Kerala does not necessarily challenge the relationship between land reform and development; as Kerala embarked on a program of land reform inspired by modernization with the goal of development. (Oommen, 1971) It can be said, however, that Kerala does challenge the very path of development that is prescribed by modernization theory. Because of the international context, Kerala was under less pressure to modernize in the way that Brazil was expected to. In this shift, we see understandings of development moving away from a strictly economic view. With the focus on Kerala’s success in the human development indicators, we can confirm that development is more fully understood to include certain aspects of population welfare. (Tharamangalam, 2010) Cuba, as well, seems to be a case that challenges the strictly econometric accounting of development and its impacts. (Tharamangalam, 2010) Naturally, as understandings of development become more complex, its relationships with processes of land reform also change.

The case of Zimbabwe brings us more fully into the contemporary context of development studies and illustrates the current evolution in understanding development and its impact on land reform. From the Lancaster House constitution to the current jambanja periods of land occupation, Zimbabwe’s contemporary experience has been informed by both modernization theory and the nuances that have been introduced over the course of time and politics. (Scoones, et al., 2010) In this regard, the case of Zimbabwe illustrates both the importance of land reform in development, but also highlights the shifting understandings of how land reform fit in to development and furthermore, what development actually is. (Pazvakavambwa & Hungwe, 2009)

Land reform in Zimbabwe has taken much the same form over its recent history with a focus on redistribution and productivity, taking its cues from modernization. To this end, a redistributive land reform scheme was implemented as Fast Track Land Reform, though it was dogged by problems of political patronage. The jambanja period of land reform, from 2000 to the present and later appropriated by the state, seems to exemplify the shifting focus of stakeholders. Two aspects of land reform in Zimbabwe reflect the profound changes in understandings of development. First, the appropriation of the jambanja process reflects the continued focus on democratic or participatory methods of reform that was evident in the case of Kerala. (Scoones, et al., 2010) Again, the context in which reform takes place is key and the post-Cold War context has been a huge factor in shaping the geography of public policy options. While it is hard to deny that the jambanja periods of land occupations have been destructive in some respects, it is cannot be said that land reform in Zimbabwe has thus failed. (Scoones, et al., 2010, pp. 242-243) Second, the A1/A2 system of plot pegging reflects the nuances of development theory that have become more fully realized, in part due to political and ideological constraints. A1 and A2 plots of land reflect the focus on small-holder approaches to land and its impact on economic and human development. (Scoones, et al., 2010) Zimbabwe’s program of land reform seems to take to heart the lessons provided in Kerala and Brazil. In the end, however, the linear relationship between land reform and economic development remains unchanged. The difference, however, is the level of analysis that such a relationship has taken. (Pazvakavambwa & Hungwe, 2009) No longer is the linear relationship seen strictly as a macroeconomic pathway, but is now also seen to be effective at the microeconomic level. This shifting of understanding is hugely important for the goal of development generally. Clearly, the relationship between land reform and development is unchanged―one is required for the other,—however, shifting understandings of what development entails has impacted land reform.

Zimbabwe also brings up many questions regarding the measurement of development. Scoones, et al. point to the 5 myths about land reform and development in Zimbabwe that are unsupported by empirical data. (Scoones, et al., 2010) We see, in the case of Zimbabwe, more explicitly the problem between measures of purported reality and actual measures of reality. In this regard, Zimbabwe represents a final complication in measurements of development. Both Zimbabwe’s economic performance and human development performance are sub-par according to measures of development, but Zimbabwe, particularly in light of the Scoones study, brings up the question of what exactly it is that measures of development ought to be. While it is hard to deny the reality that measures of development do proxy in Zimbabwe—namely the lack of economic opportunity and low levels of human development, it can be argued that these proxy measures fail to account for the everyday lived experiences of people. While it is true that comparative levels of development are lagging, the picture is one that is not completely pessimistic. The study reveals that, while there are very real development issues, proxy measures like GDP or HDI tend to undervalue the agency of the very people that are being assessed. This has a dangerous tendency to perpetuate political myths. As such, Scoones et al. deconstruct the myths surrounding land reform and resulting development in Zimbabwe. It becomes evident that land remains an important avenue for development by the poor in Zimbabwe.

Here, paying attention to the process of formalization may lead to some starting points for an answer. If measures of development are derived from experiences with modernization, how is it that those measures can be applied to alternative paths of development all together? Indeed, the development of the human development index was an important step forward, but the HDI measure is still concerned, broadly, with factors that impact the modernist path of development. Educational attainment in formal education is one in particular that fits this description. Modernization theory, and its tools of land reform, seem to point to this process of formalization. What is important to the modernist path can be measured and quantified, and becomes formal. The modernization theory of development concerns itself with formalizing previously informal economic arrangements. The very process of land reform and development is one of formalization. The cases of Kerala and Zimbabwe bring this tension into the spotlight. Kerala’s success, while not disproving the linear link between land reform and development, seems to depend heavily on the very notion of informality that modernization theory overlooks. Zimbabwe, as well, is a case that speaks to the folly of discounting the informal, especially when it comes to livelihoods and how major public policy is designed that limits informal activities. (Scoones, et al., 2010, Ch. 8 ) Both the case of Kerala and Zimbabwe serve to illustrate the limits of the ‘formal’ category of economic transactions. This is not to say that the formal category is useless. After all, the very development of the HDI has been a massive shift towards a more holistic approach to development that has been formalized. Much the same can be said about the movement to incorporate so called “indigenous knowledge” into programs of development. (Green, 1999)

Zimbabwe, and to a certain extent Kerala, demonstrate some of the issues that are present in the question of land reform and development. The historical understanding of those two relate heavily to the idea of modernization. Through time, understandings of the drivers of economic development have become more nuanced. The case of Brazil shows that land reform, on the way to modernization, can be an important step to generating opportunity. What the Brazilian case did wrong arguably was addressed in the case of Kerala. While economic development remained low, Kerala’s high human development indicators drew it the attention of the world. Land and its reform was still a key step to Kerala’s relative success in the measures of human development. This mismatch between indicators and reality is explored in Cramer’s critique of Paul Collier’s work on poverty and conflict in Africa. (Crammer, 2002) Are GDP per capita measures really an effective way of measuring the actual ability of the ultra-poor to survive? Certainly, such indicators can give a general sense of their situation (especially in a comparative sense), but GDP per capita measures of wealth (or the dollars per day metric) reduce the complex social and political contexts to a single, formally economic context. Brazil’s favelas and the case of the urban poor are an example of the tension between the formal and the informal categories and the problems of formalization. Like the categories of formality that modernization assigns in development economics, the state approaches the problem from its own perspective. (Leeds, 1996) While formal categories do apply, the case of the favelas also draws upon ideas of legitimacy to describe certain challenges to the state. In the same way that the state dismisses ‘illegitimate’ social, economic, and political forces, so too does mainstream modernization theory dismiss the ‘informal.’ However, what is needed is a deeper understanding of how these categories are created, expanded, or contracted and how, if at all, they interact and produce new modes of opportunity, growth, and development. Through understanding these modes of development, the hope is that more holistic approaches to human development can be derived and employed in addressing the impulse for development studies in the first place: human flourishing. To this end, the relationship between land reform and development still holds. Even in the case of Brazil’s favelas, the issue of access to land remains paramount. Let it be said that all theories of development require that people have a place to belong, and that changing understandings of development, in both rural and urban contexts, still place a large emphasis on land reform and access as a precondition for human flourishing.

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