Large cash or asset transfers in settlements under South Africa’s Land Restitution Programme

Publication Details

Author
Malcolm Keswell, Michael Carter, Mvuselelo Ngcoya
Institutional affiliations
University of Cape Town, University of California–Davis, School of Built Environment and Development Studies, University of Kwazulu-Natal
Grant-holding institution
Southern Africa Labour and Development Research Unit, University of Cape Town
Country
South Africa
Region
Sub-Saharan Africa (includes East and West Africa)
Sector
Agriculture and Rural Development, Social Protection
Subsector
None specified
Gender analysis
No
Subsector
None specified
Gender analysis
No
Equity Focus
Indigenous Groups
Evaluation design
Randomised Control Trials (RCT)
Status
Ongoing 3ie Funded Studies
3ie Funding Window
Policy Window Round 3

Synopsis

The study evaluates the socio-economic and cognitive impact of South Africa’s Land Restitution Programme on its beneficiaries.

Context

Between 1913 and 1994, millions of non-white South Africans were evicted and forcibly relocated both in rural and urban settings in South Africa. This history of land loss was institutionalised by the Natives Land Act of 1913 and other related laws that allocated approximately 87 percent of land to whites and reserved the remaining land for blacks.

 In 1994, the Restitution of Land Rights Act was passed. Implemented by the Department of Rural Development and Land Reform, this act entitled individuals and their descendants who were dispossessed of their land by racially motivated legal acts to file claims for restitution.

The key output of the restitution programmme is a sizeable once-off cash or land transfer to individuals. These transfers are large enough to have the potential to lift households out of poverty into a virtuous cycle leading to higher productivity and improved long-term wellbeing. However, there is no quantitative evidence on the impacts of this programme on poverty alleviation or on whether the act’s goal of restorative justice was achieved. The proposed study seeks to evaluate the socio-economic and cognitive effects of the cash or land transfer programme on its beneficiaries

Research questions

The key questions the study will address are:

What are the impacts of the programme on consumption, production, investment and savings?

Do land transfers lead to increases in the returns to labour, entrepreneurial and farming skills?

Does the programme alter the risk preferences and time discounting behaviour of the beneficiaries with consequences for the uptake of credit and propensity to save and invest?

Can a large once-off cash transfer have an impact on executive functioning – the set of cognitive processes that are central to cognition, inhibition, memory, problem solving and planning  and is this an important pathway out of poverty?

What is the impact of land transfers on social cohesion?

Are the impacts on consumption and production sustainable?

Methodology

Intervention design

The land and cash transfers follow a pipeline randomisation design. There are two subpopulations of beneficiaries, claimants that elect to receive cash compensation and claimants that elect to have their rights to the land restored (or rights to alternative lands).

Theory of change

The land restitution programme can lift households over a critical minimum scale poverty threshold. Large land transfers can also enable and incentivise households to co-invest in their new agricultural enterprise. The land transfers may also enable households to earn returns to human capital resources (labour and potential entrepreneurial and farming skills) that may be poorly remunerated or hard to sell on markets. The transfers can ease access to finance, a hypothesis in line with a number of other studies that have suggested that transfers may help microenterprises accumulate capital and move forward. The intervention could alter the risk preferences and time discounting behaviour of the beneficiaries with consequences for the uptake of credit and propensity to save and invest.  

Recent evidence suggests that making effective use of an asset or cash transfer is not only material, but also psychological or aspirational.  The programme may affect investment behaviour of the beneficiaries. This may further result in multiplier effects in education, nutrition and income- generating activities.

Evaluation design

The evaluation will draw a sample from the population of pending claims to study the impacts of cash or land transfers. The pipeline randomisation identification strategy will randomise the timing of the transfer into early and late treatment arms, where the claimants that receive their transfers later would serve as the control group to claimants that receive their transfers earlier. .The study will look at heterogeneous effects of cash transfers along various dimensions, such as sex of the head of household, age of the primary beneficiary, consumption levels, land and asset levels, education level of primary breadwinners, ownership of non-agricultural enterprise, and psychological well-being and capabilities.

The data collection will iterate between quantitative and qualitative research methods starting with pre-baseline qualitative fieldwork on a subset of land reform claimants who will not form part of the study sample to gain a nuanced understanding of various themes and hypotheses to be investigated. Follow-up surveys of all study participants will be conducted, including qualitative follow-up interviews with a subset of study participants. The qualitative interviews will focus on difficult to measure outcomes. This includes cultural benefits (land as the consolidation of a peoples’ history), non-agricultural use (such as provision of housing and shelter), land as a ceremonial asset and as a symbol of dignity and respect the role of land in reconciliation (healing the wounds of apartheid).

The study will employ a mix of survey and task-based methods to measure executive functioning, risk, time discounting, and other dimensions of preferences. The sample sizes to study the impacts of the land and cash transfer outputs of the program are approximately 2,800 and 3,250 households respectively. These samples will be randomised into the early and late treatment arms in equal proportion.

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