immediate post-reform period. We analyze short- and longer-term effects of the measures introduced to make such reform feasible politically, in particular prohibition of any land leases except share rental contracts. Specific estimation strategies and hypotheses are discussed in light of the literature on share cropping to argue that rigorous empirical evidence will be of relevance beyond the specific case at hand.

# **2.1 Land reform in India: Conceptual basis and implementation experience**

While the negative long-term impacts of unequal asset distribution have long been recognized (de Janvry 1981, Deininer and Squire 1998), attention recently focused on the distribution of resources and political power as key determinants of institutional development with far-reaching impacts on socio-economic and human development (Acemoglu and Johnson 2005; Nunn 2009). Different types of land institutions affected economic and social outcomes over the long term in India (Banerjee and Iyer 2005; Iyer 2010), Central America (Nugent and Robinson 2010), Brazil (Naritomi, Soarez, and Assuncao 2009), and the US (Libecap and Lueck 2011).

Especially if highly unequal asset distributions had been maintained by coercion or other non-economic means, broader political and economic changes often made it difficult to maintain them, creating a need for reform (Baland and Robinson 2008; de Janvry 1981; Rozelle and Swinnen 2004; Swinnen 1999). How reform was implemented had far-reaching implications for productive performance: while it often increased incentives for land-related investment and productivity of land use (Lipton 2009), failure to implement the measures quickly led to prolonged phases of insecurity and strife with negative impacts on land-related investment, productivity, and broader economic development in many cases (Binswanger _,_ Deininger, and Feder 1995).

Land reform was high on India’s immediate post-independence policy agenda after 1948, resulting in a swift and successful abolition of rent collecting intermediaries ( _zamindars_ ). Two other measures which the 1955 Land Reform Act introduced were (i) the ability to expropriate any land held by a household above a given ceiling to vest it with the state for subsequent redistribution to the poor; and (ii) tenancy laws that provided sitting tenants with permanent and registered use rights. Both remained controversial, difficult to implement,<sup>1</sup> and had undesired adverse side effects as landlords not only evicted tenants to prevent them from becoming eligible for such reforms (Appu 1997) but also failed to enter into new lease agreements.<sup>2</sup> Overall reform impacts are thus ambiguous, depending on state level implementation (Besley and Burgess 2000; Deininger _,_ Jin, and Nagarajan 2009; Ghatak and Roy 2007). Enforcement was a key reason: although the law provided tenants with permanent and inheritable use rights, landlords’ ability to take back land for ‘personal cultivation’ created a loophole that was routinely used as a pretext

> 1 As the Indian constitution makes land a state subject, implementation of laws in this area is the responsibility of individual states.

> 2 Estimates from India’s national sample survey, the share of households participating in land rental markets decreased from 26% to 11% nationally and from 35% to 14% in West Bengal (World Bank 2007).

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