Do Overlapping Property Rights Reduce Agricultural Investment? Evidence from Uganda

The need for land-related investment to
ensure sustainable land management and increase productivity
of land use is widely recognized. However, there is little
rigorous evidence on the effects of property rights for
increasing agricultural productivity and contributing toward
poverty reduction in Africa. Whether and by how much
overlapping property rights reduce investment incentives,
and the scope for policies to counter such disincentives,
are thus important policy issues. Using information on
parcels under ownership and usufruct by the same household
from a nationally representative survey in Uganda, the
authors find significant disincentives associated with
overlapping property rights on short and long-term
investments. The paper combines this result with information
on crop productivity to obtain a rough estimate of the
magnitudes involved. The authors make suggestions on ways to
eliminate such inefficiencies.