“Some General Theory about Land Reforms with a Latin American Case”
By
Miguel Rocha de Sousa1,2, Antônio Márcio Buainain,3,4
& José Maria da Silveira3,5
Abstract:
First we define a typology of land reforms throughout history, recurring to a politico economic
approach, making a survey of this event. Then, we define a general setting, a theoretical
framework (matrix), for socio-economic achievements of land reforms. Then we assess the
role of land reforms in the recent past (1980s onwards) in Latin America, defining particularly
the case-study of Brazil, where we assess the role of the “Cédula da Terra” (Land Bill) versus
the Landless Movement (MST). The main empirical findings are that human capital, credit,
technical assistance, household agrarian self-consumption are consistent with further
economic growth due to market led land reform - This is in line with our previous empirical
published work as in Magalhães et al. (2011).
Focusing on the work of Rocha de Sousa (2012) which developed a formal model of land
reform using Arrow (1962) and Jovanovic (1985) we further develop an endogenous land
reform growth model based upon Lipton (2009).
This endogenous land reform model presents an equilibria in the equity/efficiency quadrant,
which can be further used to analyse comparative statics exercises, like growth of population,
decreasing and increasing returns, technical progress.
Thus, we conclude that land reform can yet been used as a modern tool to spur growth and
development, but with our approach we can define the main limits and constraints that can
block this growth. This Arrowian setting of Land Reform, yet unpublished is still one of the
main novelties of the paper. Besides the formal Liptonian model (2009), our generalization is
rather useful for policy perspectives.
Even though theoretical, this approach, we can conclude that a raise in undifferentiated
wages after land reform leads to an unrecoverable society welfare loss; thus yielding a lesson
to political agents decision-makers elected after land reforms –wage raise land reform should
not be used as an electoral motto.
Key-words: Arrow; Brazil; Economic Development; Jovanovic; Land reform; Latin America;
Leadership change; Liptonian Model; JEL: Q15
1
Assistant Professor of Economics and International Relations & Integrated Researcher, Universidade de
Évora, Department of Economics & NICPRI-UE Research Centre; [email protected] or
[email protected]
2
Corresponding author.
Professor of Economics, Universidade Estadual de Campinas, S. Paulo, Brazil.
4
[email protected]
5
[email protected]
3