urban expansion. In fact, observers link the ability to use certificates to insist on compensation to the emergence of innovative in-kind compensation arrangements in a number of peri-urban areas.

# **3. Data, descriptive evidence, and econometric approach**

This section describes the data underlying our empirical evidence and the sequence in which the program was implemented in treatment and control villages as a basis for tracking key indicators for hypothesized program impacts. This provides a pipeline comparison group that allows us to apply a difference-indifference method to estimate the impact of land certification on the outcome variables of interest.

# **3.1 Data sources and modalities of program implementation**

To test the above hypotheses, we use data from four waves of a panel survey of rural households that were conducted in 1999, 2001, 2004, and 2007 in East Gojjam zone of Amhara region in a number of villages all of which were supported by a SIDA-supported rural development project.<sup>5</sup> In each round, the survey, which was undertaken by the Department of Economics of Addis Ababa University in collaboration with Gothenburg University, EDRI, and the World Bank, includes information on some 900 randomly selected households and more than 4,000 plots operated by them.<sup>6</sup> The fact that the first 3 waves of the panel cover the period before certification started whereas some of the villages had been certified at the time of the 4<sup>th</sup> round allows us to use a difference-in-difference strategy together with a pipeline implementation strategy. This is possible as in some villages certification had been completed 12 months or more before implementation of the 4<sup>th</sup> round of our survey, thus affecting investment and land market participation decisions. As other project components were available in all villages, there is little concern about time-varying factors affecting villages differently and thus biasing our estimates. This is supported by the fact that, before the program, outcome variables moved in parallel in the villages.

Our strategy is conservative in two ways. First, as at the time of the 4<sup>th</sup> round of our survey all the villages had received information about the certification program, households in villages which we classify as ‘non-certified’ (some of whom had already received a certificate at the time the survey was implemented) may well have adjusted their behavior in anticipation of future program availability, implying that estimates of program impacts obtained here will be a lower bound of the true effect. Second, as we define the intervention at the village rather than the household level, our ‘treated’ category includes households who, for a number of reasons (mainly conflict that could not be resolved or delays in the issuance of

> 5 The Gojjam zone was selected purposefully to represent surplus producing areas of the region. The districts and the villages in each district were also selected based on similar criteria while households in each village were selected randomly.

> 6 Information for one of the sampled villages is available only for the last two rounds, as it was included in the sample during the third round. For production information, the reference period was the main agricultural season ( _meher_ , i.e., from June-February) of 1998/99, 2000/01, 2003/04 and 2006/07 agricultural years.

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