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Land Markets, Resource Allocations, and Agricultural Productivity

341 Eggers Hall

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Trade Development and Political Economy presents: Diego Restuccia - Land Markets, Resource Allocations, and Agricultural Productivity

Diego Restuccia, Canada Research Chair in Macroeconomics and Productivity, Professor of Economics, University of Toronto

Paper co-authored with Chaoran Chen & Raul Santaeulalia-Lopis

The authors study factor misallocation and its impact on aggregate agricultural productivity using detailed household-level micro data from Ethiopia. Land ownership resides with the state but use-rights are granted at the local level in an egalitarian basis. There are severe restrictions to land reallocation. The authors find substantial factor misallocation across farmers in agriculture. An efficient reallocation of resources can increase aggregate agricultural output and productivity by 144%. They also find that more land rentals are associated with lower factor misallocation and higher agricultural productivity. On average, a one percentage point higher land rental is associated with an increase of 1.7 percentage points in aggregate agricultural productivity.

Diego Restuccia is Professor of Economics at the University of Toronto, Research Associate at the National Bureau of Economic Research and Editor of the Review of Economic Dynamics. His areas of research include macroeconomics, economic growth and development, and labor economics. His research has been published in leading Economics journals. Professor Restuccia holds a PhD in Economics from the University of Minnesota.

Sponsored by Trade Development and Political Economy at the Moynihan Institute of Global Affairs

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Moynihan Institute of Global Affairs
346 Eggers Hall