Evaluating the Impact of Land Redistribution: A Cge Microsimulation Application to Zimbabwe

Posted: 4 Aug 2008

See all articles by M. Chitiga

M. Chitiga

University of Pretoria - Department of Economics

Ramos Mabugu

University of Zimbabwe

Date Written: August 2008

Abstract

Zimbabwe has recently gone through a widely criticised land reform process. The country has suffered immensely as a result of this badly orchestrated reform process. Yet land reform can potentially increase average incomes, improve income distribution and as a consequence reduce poverty. This paper presents a counterfactual picture of what could have happened had land reform been handled differently. The paper uses a computable general equilibrium (CGE) model coupled with a microsimulation model in order to quantify the impact of land redistribution in terms of poverty, inequality and production. This is to our knowledge the first attempt to apply such an approach to the study of the impact of land reform on poverty and distribution in the context of an African country. The results for the land reform simulations show that the reform could have had the potential of generating substantial reductions in poverty and inequality in the rural areas. The well-off households, however, would have seen a slight reduction in their welfare. What underpins these positive outcomes are the complementary adjustments in the fiscal deficit and external balance, elements that were generally lacking from the way Zimbabwe's land reform was actually executed. These results tend to suggest that well planned and executed land reforms can still play an important role in reducing poverty and inequality.

Keywords: D31, D63, D58, Q15

Suggested Citation

Chitiga, Margaret Mabugu and Mabugu, Ramos, Evaluating the Impact of Land Redistribution: A Cge Microsimulation Application to Zimbabwe (August 2008). Journal of African Economies, Vol. 17, Issue 4, pp. 527-549, 2008. Available at SSRN: https://ssrn.com/abstract=1194057 or http://dx.doi.org/ejm039

Margaret Mabugu Chitiga (Contact Author)

University of Pretoria - Department of Economics ( email )

Lynnwood Road
Hillcrest
Pretoria 0002
South Africa

Ramos Mabugu

University of Zimbabwe

c/o Hall Farm, Wenhaston
Suffolk Ip19 9HE, Mashonaland
United Kingdom

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