publicity of all contracts.<sup>15</sup> Given smallholders’ advantage in labor-intensive crops with high value-added (Rogers _et al._ 2021), emphasis on upstream investment that has shown to generate larger income or poverty gains than investment focused on land only (Van den Broeck _et al._ 2017) can offer more scope for market integration of smallholders (Dubbert 2019) and a more integrated investment approach (Schoneveld 2022).

# **3.3 Anticipating climate-related challenges**

Climate change models predict that rising temperatures and greater frequency of adverse weather events will disproportionately reduce agricultural productivity in Africa (Conte _et al._ 2021). In the absence of adaptation investment, expected increases in temperature will shift the comparative advantage towards nonagriculture and depress local demand for non-tradables. Trade in non-agricultural goods is important to make up for such shortfalls: over the last five decades, cities with firms that sold their output in global markets were able to absorb drought shocks and even expand while those that depended on local markets only suffered significant declines as demand dried up (Henderson _et al._ 2017). Adoption of modern inputs, crop switching, trade, and urbanization can all reduce estimated impacts (Conte 2021), reinforcing the importance of secure transferable land rights to foster private investment in adaptation and <mark>diversification</mark> to prevent being caught in a subsistence trap <mark>(Nath 2020).</mark><sup>16</sup> <mark>Shocks to l</mark> ocal food crop production in Africa have been shown to have persistent impact on the incidence of conflict that may spill over to neighboring areas (Harari & La Ferrara 2018). One explanation is that exogenous price changes will affect the value of food producers’ resource endowments and the opportunity cost of engaging in fighting relative to production (Berman _et al._ 2021).<sup>17</sup> Sedentary and pastoral groups have long engaged in a mutually beneficial symbiotic relationship whereby animals graze on floodplains or wetlands where they provide fertilizer in the dry season. Climate shocks such as droughts can, e.g., by changing the timing of transhumance, transform such complementary patterns of resource use into a confrontational relationship. Data on almost three decades of violent conflict in Africa show that droughts in pastoral areas tend to trigger agro-pastoral conflict in neighboring agricultural areas by exacerbating competition over scarce wetlands although political participation neutralizes this effect (McGuirk & Nunn 2020). Better definition of rights over pastoral resources and land dispute resolution mechanisms further reduced the extent and likelihood of violence (Eberle _et al._ 2020).

> 15 Mandatory allocation of public agricultural land via competitive auction on an electronic platform (Prozorro Sales) powered by open source software doubled public lease revenue in Ukraine and auctions organized by local rather than central government realized prices that were higher by about 40% (Deininger _et al._ 2022).

> 16 Evidence from Brazil over more than two decades of increased frequency and severity of droughts shows that financial integration with other regions provides insurance against negative weather shocks in the short run. In the long run, regions where climatic conditions had deteriorated suffered from capital outflows and lower loan access, triggering net labor outflows even though local manufacturing absorbed some of the workers released from the agricultural and service sectors (Albert _et al._ 2021).

> 17 In food consuming areas, commodity price changes will also affect real income and thus the ease of recruiting potential fighters (McGuirk & Burke 2020).

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