Agricultural rent-seeking in developing countries: an empirical investigation

Abstract

Recent increases in demand for agricultural land has fuelled academic, as well as public, interest in the potential effects of high value agricultural land, particularly in developing countries. The dominating question seems to be: will increasing demand for agricultural land imply land grabbing or rural development? This article finds empirical support for a proposed theory which suggests that the extent of agricultural rent-seeking, in the form of large-scale land acquisitions, is determined by the relative political power of an elite and a farmer group.

Keywords:

• developing countries
• rent-seeking
• natural resource rents
• agriculture

JEL Classification:

• D72
• D74
• N50
• O13

Notes

¹ Positive when , i.e. when farmers have more political power.

² Positive when , i.e. when the elite has more political power.

³ Kleiber and Zeileis (2008).

⁴ Measures for the political power of farmers include segregation, generalized trust, the extent of mobile phone subscriptions, the extent of active membership of different civil organizations and political polarization. Measures of the elite’s political power include income inequality and the share of income going to the richest 10% of the population.