Third, in rural environments with multiple market imperfections, providing beneficiaries with access to land but not with access to markets for output and credit may fail to make them better off than before. This will be the case particularly if landlords had provided their labor tenants with inputs, credit, or market outlets before the reform.<sup>7</sup> Land markets will therefore have to be viewed in the context of the operation of other factor markets.

These generic land reform difficulties were, in past attempts to effect the redistribution of land to the poor, often exacerbated by implementation-related issues. Instead of aiming toincrease productivity and reduce poverty, the main goal of many land reforms in the past has been to calm social unrest and allay political pressures by peasant organizations.<sup>8</sup> Such reforms had often been initiated in response to political pressure (or to divert attention from other problems) rather than as part of a long-term rural development strategy.<sup>9</sup> The resulting reform measures were generally designed ad hoc, bore little relation to actual needs on the ground, and commitment to them faltered once social emergencies had subsided. Furthermore, attention often focused on the politically vocal and well-connected peasants rather than rural dwellers with the best ability to make productive use of the land, or the most deserving on poverty grounds.<sup>10</sup> The cost of carrying out land reform were often increased by the continued existence of implicit and explicit distortions which drove land prices above the capitalized value of agricultural profits and made it attractive for land reform beneficiaries to sell out to large farmers, thus contributing to re-concentration of holdings.<sup>1</sup> I Also, instead of aiming to create conditions that would improve the functioning of land rental and sales markets to complement state-led reform efforts, governments have often completely outlawed or severely restricted the operation of land rental (and to a lesser degree sales) markets. This has eliminated an important opportunity for landless individuals to acquire farming experience, made the

- In Ireland, in the early 2 0 a century, a large scaie "negotiated" land reform transferred of 9.3 million acres (about half of the agricultural land available) from landowners to tenants but had a very limited impact on productivity. One reason is that land reform -which was enacted on top of earlier legislation- did little to alter the structure of production or increase investment incentives. Another issue, probably more important, is that land reform led to a _worsening_ of access to credit, by limiting the ability of new landowners to mortgage land while at the same time cutting off informal credit they had earlier obtained from the landlord(Guinnaune and Miller, 1997). Severely restricted access to credit, together with insecure property rights have also led to widespread selling of land by former land reform beneficiaries in Nicaragua - often at prices way below the productive value of the land (Joakin 1996)Lack of access other markets has been identified as a key obstacle to the initiation and success of independent small farming operations in Easterm Europ(Brooks and Lerman 1996).

- This would be consistent with an interpretation of land reform as a piecemeal strategy by the rich to avoid the imminent threat of revolt - with backtracking as soon as the threat weakens as modeled byHorowitz (1993).

- Even where a genuine commitment to breaking the power of landed dlites, agrarian reforms were generally designed by urban intellectuals with little idea of the realities of agricultural production and a sound suspicion against the ability of small-scale cultivators to manage on their own. let alone to be able to increase productivity (Barraclough 1970).

- '° The importance of political factors is also evident from a number of Eastern European countries where political constraints generally led to a relatively "inefficienf' way of implementing land reform -through physical restitution of plots rather than compensation of former owners through fungible cash payments (Swinnen, 1997).

- " Despite attempts to limit beneficiary desertion through imposition of legal restrictions and severe punishment in case of contravention, there is considerable anecdotal evidence on land sales by reform beneficiaries in Nicaragua, Colombia, and El Salvador. In a recent Census of Brazilian land reform settlements, only about 60% of land reform beneficiaries were actually found tilling their land.

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