Land Reform and Structural Transformation: Evidence from East Asia

Abstract

Land reform is closely related to agricultural development and the whole development process. This thesis examines the impacts of land reform on asset distribution, agricultural productivity, and the process of structural transformation. By investigating land reforms in Japan, Taiwan, and South Korea after World War II, I find that land reform has positive and long-run influences on the structural transformation. Through redistributing farmland from large landholders to small farmers, land reform is viewed as an effective instrument for the achievement of low levels of asset inequality. Land reform also provides small owner-cultivators incentives to work harder and invest more in their own farmlands, leading to an increase in agricultural productivity. The rapid growth in agricultural productivity stimulates the reallocation of labor from agricultural to non-agricultural occupations, which is the key part of structural transformation.