Land institutions’ credibility: Analyzing the role of complementary institutions

Abstract

Institutions shape people’s behavior and perception. This help reduce uncertainty. Institutions play an important role in shaping socio-economic outcomes. For this to happen institutions must be effective and functional. Institutional effectiveness depends, to a large extent, on factors such as the existence of an enabling environment, which includes complementary institutions. Over the years, several developing countries introduced land formalization. The change in institutional arrangements, in many cases, was made in anticipation of a better land tenure security provision. However, it is not clear yet if the change in land institutions produces the intended result, for instance, in the absence of dependable complementary institutions such as politico-legal institutions. By doing a review of the literature and using data from Property Rights Alliance (IPRI 2018) and Freedom House this study analyzed 10 countries to find a correlation between land institutions’ credibility and the quality of politico-legal institutions. This is to assess to what extent the success of land reform depends on the quality of the existing politico-legal institutions. The result of the study reveals that there is a strong correlation between the quality of politico-legal institutions and the quality of land institutions of a given country. This shows that land institutions and politico-legal institutions are highly interdependent. This underscores that in the absence of a strong or effective politico-legal institutions land reform might fail to fulfill its objectives, which undermines its credibility. To establish a credible land institution, it is imperative to put effective politico-legal institutions in place.