Land Accumulation Dynamics in Developing Country Agriculture

Abstract

Understanding land accumulation dynamics is relevant for policy-makers interested in the economic effects of land inequality in developing country agriculture. We thus explore and simultaneously test the leading theories of micro-level land accumulation dynamics using unique panel data from Paraguay. The results suggest that farm growth varies systematically with farm size – a formal rejection of stochastic growth theories (that is, Gibrat’s Law) – and that titled land area may have considerable influence on land accumulation. Furthermore, our estimates indicate that a dualistic agrarian structure is the likely product of the unfettered operation of land markets.