Breaking Up the Collective Farm: Welfare Outcomes of Vietnam's Massive Land Privatization

48 Pages Posted: 27 Aug 2003

See all articles by Martin Ravallion

Martin Ravallion

Georgetown University

Dominique P. van de Walle

World Bank - Development Research Group (DECRG)

Date Written: November 12, 2001

Abstract

In the decollectivization of agriculture in Vietnam, local allocation of land use rights reduced overall inequality - thanks to initial conditions at the time of reform and actions by the center to curtail the power of local elites.

The decollectivization of agriculture in Vietnam was a crucial step in the country's transition to a market economy. But the assignment of land use rights had to be decentralized, and local cadres ostensibly had the power to corrupt this process.

The authors assess the realized land allocation against explicit counterfactuals, including the simulated allocation implied by a competitive market-based privatization. The authors find that 95-99 percent of maximum aggregate consumption (depending on the region) was realized by a land allocation that reduced overall inequality, with the poorest absolutely better off. They attribute this outcome to initial conditions at the time of reform and actions by the center to curtail the power of local elites.

This paper - a product of the Poverty Team and the Public Services Team, Development Research Group - is part of a larger effort in the group to undertake ex-post assessments of the efficiency and equity implications of policy reforms.

JEL Classification: D60, P21, Q15

Suggested Citation

Ravallion, Martin and van de Walle, Dominique P., Breaking Up the Collective Farm: Welfare Outcomes of Vietnam's Massive Land Privatization (November 12, 2001). Available at SSRN: https://ssrn.com/abstract=421760

Martin Ravallion (Contact Author)

Georgetown University ( email )

Washington, DC 20057
United States

Dominique P. Van de Walle

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States
202-473-7935 (Phone)
202-522-1154 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/dvandewalle

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