Poverty and land access in South Africa: Is land important?

Peter Terrance Jacobs, Fordham University

Abstract

This thesis examines the role and importance of land access and location for poverty alleviation among rural poor households in South Africa's ex-homeland regions. For poor households, land access has several dimensions. Even a small plot of land can be used as a productive asset, or as collateral to finance investment in small enterprises or human capital, or as a wage supplement in highly competitive labor markets. Communal or tribal access to land can also provide access to credit via membership of social networks. Land also fixes a household's location and can impede mobility if it cannot be sold. ^ South Africa's 1997 Rural Survey provides micro level data for 5767 households living in 92 districts and provides data on several dimensions of land access: tribal vs. private, land size and years with land access. Three main hypotheses are tested econometrically using ordered logit at the household level and weighted least squares at the district level. We find that investment in education raises income and contributes toward the alleviation of poverty in rural areas. Human capital is important for social mobility among the rural poor as it has a significant negative effect on $2/day poverty rates. Moreover, land access increases investment in human capital. Location is also a key determinant of poverty. Districts closer to major urban centers have lower poverty and higher wage income—an important caveat for land distribution policies that impede mobility. At the district level, a larger share of tribal vs. private land and higher inequality in the distribution of land both increase poverty, especially for those rural poor living near the lower $1/day poverty line. ^ A key policy implication for South Africa's land reform program is that land redistribution is likely to help only the poorest groups. Policies to redistribute land should focus on provinces located closer to urban areas and should not discourage mobility within South Africa's highly differentiated rural and urban labor markets. The wrong approach to achieving land access could reduce extreme poverty only to trap the poor in relatively low productivity labor markets. ^

Subject Area

Economics, General|Economics, Agricultural|Economics, Theory|Sociology, Public and Social Welfare

Recommended Citation

Peter Terrance Jacobs, "Poverty and land access in South Africa: Is land important?" (January 1, 2002). ETD Collection for Fordham University. Paper AAI3037221.
http://fordham.bepress.com/dissertations/AAI3037221

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