10 - Property Rights, Collective Action and Technologies for Natural Resource Management: International Development Research Centre

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10 - Property Rights, Collective Action and Technologies for Natural Resource Management

Document(s) 13 of 34

Anna Knox and Ruth Meinzen-Dick

Degradation of natural resources has become a global problem that threatens the livelihood of millions of poor people. Many promising technologies for natural resource management are available to address these problems, but farmers and others often fail to adopt them. Why is this? Although many factors can be identified, lack of secure property rights and collective action deserve greater attention from policymakers and technology developers.

How Property Rights and Collective Action Affect Technology Adoption

Unlike conventional agricultural technologies, many natural resource management (NRM) technologies take years to give results. If farmers do not have secure rights to the natural resources, there is no incentive for them to adopt these technologies.

Adapted from:
CGIAR Systemwide Program on Collective Action and Property Rights (CAPRI) Policy Brief Number 1, October 1999.

Some technologies need to be adopted over a wide area to be effective. Thus, farmers with small areas have to cooperate with their neighbors to increase the land area and adopt the technology. In analyzing how property rights and collective action affect technology adoption, one has to examine the time horizon and spatial scale of the technology.

Some technologies require collective action over a wide area but offer rapid economic returns like Integrated Pest Management (IPM). Some technologies require long term investment but are localized in area, like terracing. Others have long time horizons and need collective action like watershed management and irrigation systems.

Figure 1 illustrates the time and spatial scale of various technologies in relation to degrees of collective action and tenure security. This framework helps determine whether the status of property rights or collective action is likely to constrain or enable various technology choices. It can also provide guidance on developing and disseminating technologies that are appropriate for an area's institutional context. Technologies operating on a landscape (spatial) scale may be more appropriate where traditions of cooperation are strong, while those that require a long time to produce benefits may be more successful where tenures are long-term and reasonably secure.

Property rights and collective action help determine the type of technologies adopted by communities. They are also important in determining who benefits from productivity increases, both directly by determining who can reap the benefits of improvements in factor productivity, and indirectly through their efforts on land markets, access to credit and the like.

Figure 1. Property Rights, Collective Action, and Sustainable Agricultural and Natural Resource Management

Note: Location of specific technologies is approximate, for illustrative purposes. HYVs = High Yielding Varieties

Property Rights

Property rights include not only ownership of resources as defined by laws, but also a variety of rights from customary law and local practice.

For tenure security, the rights should provide:

Excludability, to allow those with rights to exclude others from using a particular resource

Duration, to provide a sufficient time horizon to reap the benefits of investments

Assurance, from institutions that can enforce an individual's rights

Robustness, the number and strength of the bundle of rights an individual possesses

In some developing countries and in Africa, policy dictates replacing community-based land tenure institutions with freehold tenure backed by formal titles. However, evidence shows that having titles and privatizing land ownership is unlikely to increase adoption of technologies because it tends to be insufficient for enhancing tenure security, and worse, may even weaken it.

Where indigenous property rights institutions have been effective in enforcing secure property rights for community members, a title does little to strengthen the land rights of community members. Only when local systems have broken down (because of either internal factors or external threats like outsiders attempting to claim land) does land titling appear to be needed. In highly commercialized areas, land titling may also be needed for securing credit or engaging in land markets.

Collective Action

Collective action for natural resource management can include: joint investment in buying, constructing or maintaining local infrastructure and technologies; setting and implementing rules to exploit a resource; representing the group to outsiders; and sharing information.

Collective action does not guarantee equity. In some areas, women and the poorest may have little voice in the decision-making process despite their labor contributions.

However, one cannot assume that collective action exists. Research shows there is greater social cohesion if the number of users is fairly small, if they are alike in terms of shared values and dependence on the resource, and if the net benefits from group membership are substantial and equitably distributed.

Where there are sufficient incentives but governance mechanisms are lacking, local leadership or external community organizers can facilitate collective action. But for collective action to be sustainable, governance should be institutionalized and not dependent on a single person.

Linkages between collective action and property rights are especially strong in the management of common property resources. Tenure security for users of common property resources requires the following:

an effective local institution manages and regulates the use of the resource and ensures that members abide by the rules

the group or community has secure ownership rights over the collectively managed resource

individuals have secure membership in the group to be able to continue using the resources

Many common property resources are under pressure from factors like population expansion and increased competition. Policies that recognize community rights and local organizations help natural resource management in such situations.

Factors Influencing Technology Options

Many other factors besides property rights and collective action keep farmers from adopting technologies for natural resource management. However, even many of those factors interact with property rights or collective action.

Information

Farmers need information if they are to adopt technologies. The distribution of information and technologies is linked to property rights. At the community level, extension services often favor landowners which give greater access to men and the wealthy. Collective action can strengthen the bargaining power of disadvantaged community interest groups, and the formation of networks among community members can facilitate access to information. Networks and other forms of collective action may also enable coordination of technology adoption efforts. For example, establishing a communally-managed seed bank may facilitate individual tree planting and provide a forum for information sharing on the technology.

Environmental and Price Risk

Risk-averse and low-wealth farmers are often reluctant to adopt technologies because they need stable income and consumption streams. The ability to manage risk can be affected by prevailing property rights and collective action institutions. Common property resources frequently function as a buffer against risk. Collective action enables risk-sharing and diversification, and inspires mechanisms for collective self-help like norms dealing with reciprocity.

Wealth

Wealth is linked to power and property rights over natural resources thus affecting people's options for adopting technology. For example, in Pakistan, farmers who own more land are wealthier and can afford to install tubewells. They, therefore, have a control over groundwater which makes them even richer.

People who are more endowed place a higher future value on medium- and long-run benefits produced by investments in technologies compared to the poor who are constrained by food insecurity and risks. As a risk-sharing device, collective action can alleviate food insecurities and other survival risks. In addition, it helps realign the distribution of gains from a resource by facilitating the adoption by the group of more advanced but "expensive" technologies.

Credit

Credit is a way of overcoming wealth constraints to investment. It is often argued that farmers need individual land title to offer as collateral for credit. Privatization gives small farmers access to formal financial services. However, these formal financial institutions remain rare in many rural settings, particularly for agricultural lending which is considered risky.

The many examples of informal financial institutions undertaking successful group lending schemes may be seen as substituting collective action for conventional property rights as a form of collateral. Credit groups may even enhance opportunities for collective action in natural resource management (NRM). If groups are already formed around a common purpose and share a common set of norms and values, this reduces the information and coordination costs of their organizing around another purpose.

Labor

Labor bottlenecks resulting from high labor requirements are also cited as a constraint to technology adoption, especially if the new technology creates a seasonal peak for labor that overlaps with other agricultural activities. Collective action and reciprocity arrangements may be employed as a means to overcome household labor shortages thereby facilitating the use or more labor-intensive technologies.

In western Ghana, the spread of cocoa as a commercial crop has led to men's demanding a greater share of women's labor to farm cocoa crops owned by men. In some cases, men have given women a stronger claim over land as compensation, a shift that is expected to result in greater technology adoption by women.

Within households, property rights often fail to correspond to labor responsibilities. In some cultures, women work in their husband's plots in order to access plots for their own production. The introduction of a new technology, like irrigation, can shift these labor demands and responsibilities.

Other Conditioning Factors

Other factors besides property rights institutions expand or constrain people's technology choices. These include laws and community rules, norms and ideas.

In Mexico, farmers' adoption of conservation tillage practices is partially attributed to state agricultural policies including a law prohibiting the burning of crop residues. On the other hand, in South Asia, taboos forbid women from using plows, thus restricting agricultural productivity and reinforcing women's dependence on men. Nevertheless, property rights institutions frequently shape and reinforce other rules, both legal and normative.

Although on the surface cultural norms that hinder technology adoption may appear to have equity, efficiency or environmental drawbacks, there are more profound implications behind this. In many rural African societies, communities promote cohesion and lessen exposure to risk through kinship and marital practices. These have implications for the distribution of property rights. In patrilineal societies, women often move to their husband's community after marriage. They then acquire secondary use rights to the land while giving up their right to land in the place of their birth. The principles and property regimes that facilitate a cohesive community may reduce exposure to environmental risk, and preserve women's secondary rights, but with rising rates of widowhood from HIV/AIDS, the lack of rights for women creates other types of vulnerability.

Property rights and collective action are not fixed for all time but are dynamic institutions. The choice of NRM technologies inevitably shapes the institutions underlying property rights and collective action. For example, the gains from coordinated efforts in irrigation systems may lead farmers to cooperate and develop common property regimes if they have the necessary information and means to reduce transaction costs.

Generally, technologies that increase the value of a resource may induce privatization, enclosure and the exclusion of some customary uses. Yet the gains to some households or individuals because of these institutional changes are frequently offset by losses to others. Empirical studies show that as household income increases, the reliance on common property resources for subsistence purposes decreases. However, privatization of common property resources may have an adverse effect on those who still depend on the commons for a range of resources.

However, if incentives for adoption are not built into property rights and collective action institutions, if farmers lack key information, and if transaction costs of coordination and enforcement are not reduced, then technology adoption will not succeed. Hence, the ability of a society or community to efficiently adapt determines its potential for technical and institutional change.

Implications for Efficiency, Equity and Environmental Sustainability

Adoption of new technologies is not an end in itself. Rather, technological change should be evaluated in terms of its contribution to broader goals of growth, poverty alleviation and environmental sustainability.

Property Rights and Technology Adoption

Technologies that increase production of one group at the expense of other groups do not necessarily improve efficiency.

Privatization of common property and land under communal tenure tends to lead to loss of multiple user rights in favor of a select few. Research has linked conversion to freehold tenure to loss of access to land and other resources by smallholders, and to large-scale acquisitions by the rich.

Evaluation of technology efficiency needs to consider risk and transaction cost. Wealthy farmers can afford the risk of adopting mechanized and capital-intensive technologies while low-wealth households may not take the same risk; rather, they will place higher value on stability of earnings. Incorporating transaction cost and risk considerations in efficiency calculations shows the rational strategies by the poor, and broadens appreciation for technologies that improve efficiency.

Ownership of property enhances the status and bargaining power of individuals within the household and the community. Greater control over resources tends to enhance men's capacity to influence power structures, and to exert political leverage with government officials and those responsible for technology distribution, infrastructure and market development. Thus, technology will mainly reflect the interest of men who control substantial resources unless collective action emerges that is capable of reshaping policies and political outcomes to override these biases.

Introducing technologies that are unsuitable for small-scale farmers and those with less secure tenure aggravates inequality. Determining the temporal and spatial scale of a technology, and relating this to the local distribution of tenure indicates where there is likely to be a problem. For example, the scale neutrality and short-term benefits of planting high-yielding varieties make this technology more adoptable by small farmers.

Collective Action and Technology Adoption

Collective action can be used to influence choices based on their anticipated impact on efficiency, equity and environmental sustainability.

Collective action can enable marginalized groups to challenge property rights institutions, political and cultural institutions and technology adoption. It can also be used to prevent the use of certain technologies or to modify their features, as in the case of some Filipino fishermen who were able to stop the use of dynamites and poison for fishing. Instead, local groups constructed artificial reefs to lure more fish and increase their food supply.

Integrated community participation in decision-making not only ensures that a new technology does not disproportionately and inefficiently increase the workload of marginalized groups, but also permits reduction of overall labor inputs.

Linkages and Trade-Offs

Inequities have environmental implications. The use of pesticides by large farmers may adversely affect small farmers if they do not have access to it, especially if the pesticide eliminates even natural enemies of pests.

Inadequate access to land and technology by the poor can lead to overexploitation and degradation of resources. When indigenous peoples are no longer assured of benefits from investments or long-term management practices, individualization of resources can facilitate more sustainable resource management practices.

Efficiency, equity and environmental objectives also involve trade-offs. · Maximizing efficiency leads to selection of some inputs (labor, capital, land) at the expense of others, leading to inequitable outcomes. In the United States, efficiency-enhancing technologies is partly responsible for the demand for skilled labor at the expense of unskilled labor.

Efficiency measures tend to assess only the private financial costs of inputs and neglects social and environmental costs.

Trade-offs may sometimes be overstated. Environmental degradation can raise the perceived value of products leading to investment in technologies that conserve the resource base. When efficiency criteria are placed in a dynamic framework, the value of a resource over time is captured and conservation often emerges as the optimal strategy. When transaction costs and risk considerations are incorporated into efficiency calculations, the livelihood strategies of the poor can be seen as economically rational. When productivity measures include the value of non-traded goods and services in poor households (like women's labor), an equitable distribution of resources or technologies that favor the disadvantaged may be seen as highly productive.

Appreciation of less tangible economic and social dynamics broadens the scope of technologies deemed to be efficiency improving, so that the poor are not left behind or hurt by the technologies.

Policy Implications and Areas for Research

Strengthening local institutions of property rights and collective action increases the probability that people will use many new technologies for resource management. However, no single property regime is most appropriate for a particular technology in every instance. Local law derived from a number of sources may have an equal or greater influence on actual behavior.

Collective action cannot be dictated by outsiders. However, policies such as employing a cadre of institutional organizers have been effective in fostering local organizations for voluntary resource management activities.

Property rights over natural resources can provide an important policy tool for strengthening collective action in their management. Just as individuals are unlikely to invest in technologies unless they have secure tenure, communities cannot be expected to adopt long-term practices if they lack long-term rights to the resource. Yet many governments have been unwilling to transfer rights to water, irrigation, infrastructure, rangelands or forests when they devolve management responsibility to user groups. The issues of community rights and ways of creating new common property resources (in place of government ownership) are emerging as critical issues in devolution programs.

In Namibia, an organizing partnership of communities, NGOs and the Ministry of Tourism and the Environment established participatory mapping systems and other institutions to jointly manage wildlife resources. The organizers spend time in communities encouraging local participation in both direct activities and decision-making. This approach has shown high returns in terms of adoption and sustainability of resource management practices.

Contributed by:
Anna Knox and Ruth Meinzen-Dick
Email: a.knox@cgiar.org

Document(s) 13 of 34

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