Impacts of land certification on tenure security, investment, and land market participation: evidence from Ethiopia

While early attempts at land titling in Africa were unsuccessful, factors such as new legislation, low-cost methods, and increasing demand for land have generated renewed interest. This paper aims to assess the impacts of land registration in Ethiopia. The paper was motivated particularly by the fact that evidence on the impact of specific interventions is lacking so that it is unclear whether land tenure should be of greater concern to policy makers.The paper finds that certification has resulted in a significant reduction of tenure insecurity and an increase in land-related investment and supply to the land rental market. Although tenure insecurity decreased markedly due to certification, it remains large, pointing to the need for complementary action on the policy front if the full potential of this intervention is to be realised. The paper indicates that if the voluntary investments made following certification are maintained, or if additional investment is forthcoming in the future, benefits exceed certification cost. Furthermore, the cost of maintaining the land administration system will not be a major constraint to its sustainability in the long term. The paper concludes that in situations where improper circumstances pose a threat to tenure security, a community-based process to certify and register rights may be economically and socially beneficial. The process can be done by securing existing rights and allowing right holders to individually or collectively take decisions on how to use such rights. The paper stresses the need for follow-up research to explore the extent to which benefits from land certification are affected by the policy environment on the long run, as well as their distribution and longer-term trajectory.