A cooperative benefits framework in South Africa's land redistribution process: The case of sugarcane farmland transfers

Abstract

ABSTRACT A good indicator of successful land redistribution cases has to be the continuation of viable productivity rates in their post-transfer periods. Continued productivity benefits all the stakeholders that are involved in the process. Unfortunately, negative productivity levels have been reported in numerous South African land redistribution transfers in recent years. A game theoretic perspective is adopted to illustrate and argue that cooperation among key stakeholders, which could be enforced through long-term contracts between land buyers, sellers and new owners, may lead to maintenance and higher productivity levels and other benefits within the country's land redistribution process. Sugarcane farm transfer cases from two municipality districts in the KwaZulu-Natal province are used to show that the productivity rates in the post-transfer periods within cooperative land sales were more than 10% higher than the rates observed before such transfers. At the opposite end of the scale, the productivity rates in non-cooperative land sales dropped by 12% after the land was sold and taken over by new farmers. Also notable is that the prices paid by government for farms that became less productive after transfers were higher by more than 40% compared to prices paid for productive farms. The cases could be illustrative of the benefits of cooperation in land redistribution transactions.