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Longer description of your proposed project

Oligarchic land ownership keeps farmers poor. Dismantling these feudal systems has worked in the past to help communities and nations get on the path to economic development. I plan to make direct land purchases from landowners who don't work the land, then immediately transfer to the current landless farmers who work that land.

The modern ‘feudal lord’ isn’t living in a castle somewhere. He works a desk job in the city, buying satellite imagery to help monitor the output of his farmhands. He likely inherited his land and gets a small supplementary income from it, but many of these landowners want to get out of the landownership game. It’s too much work for too little gain. The problem is that everyone else inherited their land, too. They all want to sell - just not for too low a price, because it does bring in that extra income. This means nobody can afford to sell.

Meanwhile, this arrangement is hard on the farmer who actually works the land. Rents to the landowner are steadily around 50% of the income of the land (for economic reasons I won’t go into here), with plot sizes for the tenant farmers just large enough for subsistence living. Many tenant farmers have worked the land for generations, but they don't own the land and have no hope of ever doing so. So they hike the 2-3km from the nearby village to work every day. These farmers know the land. They see many opportunities to increase yields, but they aren’t allowed to because the improvements aren’t legible to the landowners.

The current situation around the world is that landowners are stuck with farmland capital they can’t liquidate, and the farmers themselves are stuck working at subsistence levels with no path out. If the landowners could transform their land into liquid capital, they’d be free to invest the money. If the tenant farmers owned their land outright, they could make their own decisions about what to plant and how. Historically, this kind of reform has resulted in crop yields from 2-8x as much as under the feudal ownership model. The challenge is how to go from a feudal system to a modern one.

This question isn't new. The issue of “land reform” has been a stable demand for centuries, often as the centerpiece in the demands of revolutionaries. Most attempts at land reform are unsuccessful, because legacy landowners don’t benefit from having their land directly transferred by the government to someone else. For historically unique reasons land reform worked in Taiwan, South Korea, and Japan – and it directly preceded economic development in each of those countries. Land reform in Indochina and the Philippines was not successful, and economic development in those countries didn’t take off.

I propose to solve this problem by purchasing land from landowners – thereby freeing up capital for them – then dividing and transferring that land to the farmers who already work the land. This will be done in a single step (for legal reasons most countries don’t allow foreigners to own land), after planting but before harvest (to ensure farmers don’t have to go into debt to fund their initial planting season).

What I’m proposing is a method of land redistribution – land reform – that will be voluntary to both parties in the transaction. For that reason, I’m hoping it will avoid the traditional objections to land reform, while providing a stable path to economic development for the affected communities. While the initial capital expense is relatively high, my hope is that it will be a one-time transfer that restructures the underlying economic order in low-income communities, allowing them to grow into middle-income communities and beyond.

My plan is to start small, with 1-3 farms (depending on how much capital I can raise) and follow the progress of those farms (and the affected farmers) compared to their near and distant neighbors.

I will begin by focusing on small island nations in the Lesser Antilles (Caribbean), where a few hundred hectares will represent a significant percentage of the nation's farmland. The project is expected to have a large enough impact on these small nations to be measurable in GDP and other official metrics, in addition to local surveys of farm output and farmer flourishing. There may also be some contribution from reinvestment of the land purchase price from the former landowner, which I plan to track.

This project is designed to return a quantitative estimate of principles that have previously only been inferred qualitatively in the development literature (or where confounding factors introduce uncertainty about quantitative measures).

I plan to publish my results as I go. Once I can demonstrate that this approach is effective, I’ll seek additional funding to roll out charity-driven land reform at scale, possibly focusing on other small nations to increase confidence and quantitative precision.

Describe why you think you're qualified to work on this

I have a PhD and a background in clinical research that I think will make me uniquely suited for determining whether this intervention works or not. My clinical research work focuses on developing treatments that alleviate toxicity from the side effects of cancer therapy. This means we put a lot of thought into how to measure whether an intervention is successful or not. In my experience, people often focus on metrics that aren’t important to the target population (surrogate endpoints), while ignoring much more relevant metrics. While lowering a lab value may be important, no patient comes into the clinic asking their doctor to lower their triglycerides. Therefore, it's important to directly ask the subject, “Do you feel better off than before the intervention?” This also applies to the development efforts.

I work in a small startup pharmaceutical company – including a US team of myself and three other people. This means I have a lot of experience working independently. When something needs to be done, there is no ‘expert’ who specializes in that thing, there’s just me. I’m primarily responsible for drafting the protocols, as well as managing the day-to-day operations of complex, multi-million dollar clinical trials.

This project will require similar expertise. It will require research to determine the appropriate target country to start in. In addition, I want to ensure the results are interpretable as either successful or not, which means ensuring the follow-up for the farmers is careful and useful.

The actual land transfer will require coordination among the landowner, farmers, local legal counsel, a local guide, and surveyors to ensure proper distribution. This will require vetting of contacts in low-income countries. I’m comfortable working internationally, including in low-income countries. I am also a thoroughly experienced interviewer, and have been a key decision-maker for our company in new hires as well as hiring contract work.

In preparation for eventual funding, I’ve been making contacts and conducting interviews with people working in economic development in India, the Philippines, Kenya, Honduras, and Mexico. I’ve been surprised at how consistent their feedback has been about the feudal land ownership models in these countries, each with their own regional variations. I’ve been working my way through the academic literature. I also have an open dialogue with a development economist in this field.

Other ways I can learn about you

ACX commenter handle: SCLMLW

LinkedIN profile: www.linkedin.com/in/mark-webb-phd-09489148/

Company website: OnQualityRx.com - you can find a short bio of me under "Who We Are" > "Research & Management"

How much money do you need?

$5,000 to $15,000 – this will fund research to prepare for my first land purchase, but it won’t fund the purchase itself. Hopefully, I can use these initial funds to line up my first land purchase and make the project attractive to larger investors/donors.

$250,000 – this should be enough to make the first land transfer. I know this is way more than what ACX is looking to spend on mini-grants. I’d be very interested in discussing my plans with oracular funders who want to take a chance on a larger venture, though.

$1M+ – the eventual goal is to demonstrate that charity-driven land reform is effective enough to begin rolling it out at scale.

Estimate your probability of succeeding if you get the amount of money you asked for

$5,000-$15,000

90% probability I will be able to identify one or more land purchase opportunities, with supporting documentation and plans for how to implement both the purchase and the follow-up/measurement protocols once sufficient funding for a land purchase is acquired.

$250,000

75% probability I’m able to make the purchase at all. (Lower probability for any specific jurisdiction, but if it doesn’t work out in one location/country, I can try others until it works.)

Conditional on making the purchase: 80% probability the intervention will be measurably successful at making the lives of the farmers themselves better. 55% probability the net effect on other locals will be positive. 5% probability we’ll be able to show a measurable improvement in economic indicators with just one farm.

$1M+

Difficult to assess. If the net effect from the land purchase isn't positive, I won't seek expansion (barring unforeseen circumstantial complications). Conditional on initial land purchase demonstrating farmer improvement: 60% probability of demonstrating broader local economic improvements from the intervention.

sclmlw avatar

Mark Webb

4 months ago

Progress update

Progress so far...

Thanks to everyone who has expressed interest in this project since its inception. I've run into some issues unrelated to the project that have stalled efforts, so I haven't seen as much progress as I'd hoped by this point. Still, here's where I'm at so far:

Contacts in the Lesser Antilles: No luck so far. Still working on this and on expanding my scope of contacts. The biggest problem I'm seeing is that a lot of the poorest farmers aren't connected very well to the internet (including the farmers discussed below, who did not have access to internet).

Backup Plan Interviews: I've developed some contacts in Honduras who allowed me to do some interviews with local farmers of varying degrees of prosperity. I'm going to try and keep some of the details vague so as to not accidentally give one of our gracious small farmers accidental fame. These interviews helped me get a better perspective about some of the local conditions and infrastructure surrounding farming. Apologies that these narratives aren't able to cover the full scope of our discussions.

Alice's story - The first lady I interviewed owns some land and rents some more land in order to make ends meet. Let's call her Alice. Alice is lucky, in that she found an older man (Bernard) whom she can do long-term land rentals from, so she has a lot of control over land-related farming questions. Bernard is getting older and can't work the land, so she pays him a reasonable rate and knows she can keep renting the same land over and over again. Apparently in Honduras this is often not the case, dramatically limiting the kind of improvements you can make on the rented land. Alice knows she has an opportunity to plant cash crops, and she has a plan. She put $4k-$5k into irrigation, rent, and planting in a gamble that the price of plantains will stay high and the yields will ("by the grace of God") return around $12,500 in sales after about a year. (Most of the overhead cost is from renting the land.) If the crop isn't successful (due to flooding, rot, or market shifts), she could be ruined - though she'd still get by from her side-gig growing sweet potatoes on the land she owns outright. By the standards of many of her neighbors Alice is doing well for herself, especially with the prospect of earning north of $8k net profit from the plantain harvest.

If Bernard dies or refuses to continue renting from her next year (he's a friend, so this is less likely) Alice will have to pull the irrigation pipes after the first plantain harvest. She'd lose all the drip infrastructure, which is a cost she'd just have to eat. So long as the situation with her friend continues, where she rents the land and he makes a profit from renting out the land he can no longer work, she will continue to be able to capitalize off of this situation.

A few observations from this case study:

  1. This doesn't look a lot like the kind of farming situation I'm trying to focus on. Indeed, Alice's access to land appears to have made her relatively well off financially, compared to her peers.

  2. One concern about land redistribution that has been raised is that a farmer will just sell their land back to the landowner and be back in the same situation as before - or that they might sublet their farm in turn, perpetuating the cycle. My hypothesis was that with smaller farms this strategy is untenable. Here, we see that farmers who own a smaller farms, like Bernard, will sublet their land. However, in this case, Bernard isn't trying to establish a vassal relationship - probably because he can't. He doesn't have enough land even for Alice to work on her own. He doesn't have enough market power to monopolize the land market. And he's a close personal friend of Alice, such that he trusts her to make her part of his 'retirement' plan.

  3. Alice was knowledgeable and animated during our discussion. She is very entrepreneurial and passionate about farming. This was a feature of many of the farmers I talked to. They often have to project market prices vs. long-run weather conditions to determine whether they'll be able to make it this year. At least for those I interviewed, these weren't lazy subsistence farmers. Desperate circumstances, were more likely to promote creative, hard-working farming strategies.

  4. Given the low cost of farm inputs from low-income countries compared to US agriculture, and how much success for these farmers depends on minor shifts in market prices, I'm less motivated by the 'buy local' campaigns than I was before I'd spoke to these farmers. I'm not trying to be controversial here, and am willing to be persuaded otherwise, but after talking to Alice and others I can see the other side of this transaction. Perhaps it's better to buy my plantains and sweet potatoes from wherever is cheapest, as opposed to a local farmer in my area (which isn't very hospitable to farming in the first place).

Carl's story - Carl is a corn/bean farmer who is involved in his local politics. He works closely with the mayor and helps identify which farmers are most in need of some of the aid they get from various charitable/development organizations. Often this comes in the form of additional fertilizer. He says the people who most often need help are the ones who don't own their own land, but who have to rent. Most people rent, and most of them rent from a large farm that used to be owned by the Chiquita company back when they were allowed to own land in Honduras. Apparently it's now mostly used to grow sugarcane, rented out to a large number of small, semi-independent farmers.

Carl is doing okay for himself. He rents about 4-5 hectares (they use a unit called "manzanas", which are 0.7 hectares or about 2.5 acres). Sometimes Carl grows watermelon, which pays a lot better per manzana than corn, but there's a huge problem with local petty theft and rot/plagues. The theft is mostly local kids (like what Merry and Pippin were doing when we first meet them in the LoTR movies), not a large percentage of the crop. The plagues can be controlled with chemicals, but if you're not consistent you can lose a whole crop.

Observations:

  1. Neither Carl nor Alice reported any restrictions on land use as renters. I think this is likely who I was talking to, or possibly a feature of Honduras' land market. A lot of the 'restrictions' seem to be self-enforcing. You're not going to plant something in an area where it couldn't grow, so if you're renting a swamp, you'll plant different crops than if you're renting a hill. Still, this is different from some of my interviews from other countries (like in Kenya or the Philippines) where farmers were heavily restricted in what they could plant by the local landowner.

  2. Both of these farmers emphasized that they live in close-knit communities. Everyone knows who is doing worst off, and people come together to help them out. There's a lot of international aid involved, and that's often already part of each farmer's calculation for how they plan to make money each season. We discussed specifics (dollar amounts, acreage, etc.) in each of our conversations. Both farmers had a plan for making money this season, had experiences they'd implemented from prior years, and understood the risks involved.

  3. Irrigation is a big deal, and a big deadweight cost for farmers in Honduras - both in terms of labor and materials. Unlike in areas where farmers use the same land for years on end, in Honduras farmers can't rely on renting the same land from one season to the next. This means they spend a lot of money on irrigation equipment, and both farmers noted that part of those systems (namely the drip system) has to be abandoned every year. This drove up costs, though for renting farmers the largest single cost was still the land rental cost (by a wide margin).

A word about the charitable organization I was working with: They were very interested in and receptive to the idea that land is an issue. They said they'd plowed through dozens of possible metrics as ways to help the farmers they're working with, but that they'd never considered land until now. When they started asking their farmers about land use and land rights, they got a LOT of positive feedback. I think this message resonates with the many good people trying to do sustainable economic development work. Even so, it's not immediately clear what they can do with the problem of land distribution other than, "land is a big deal", so there's a possibility nothing comes of simple awareness.

Next steps:

I'm working on identifying a good community for a land reform project. Although the people I talked to in Honduras were very receptive to this idea, and I think it would work well for them, I'm not convinced the improvements would be legible. Indeed, many of the features I identified in interviews across other nations were not present in Honduras.

Why did I shift to Honduras, when I was clearly focused on smaller island nations in my earlier post? Mostly this is a case of 'looking under the lamppost because that's where the light is'. I'm still working on developing contacts in the target regions.

🌴

Mio Tastas

9 months ago

I have read through the details on this now after commenting on the ACX thread some week back ("private sector Sun Yat Sen"). It looks incredibly appealing, both as a project and on the political level. I'd be happy to help out in some way, though it's not clear in what way I can at this point.

A few questions:

  • It's my understanding that part of why land reform is so vital is that productivity increases in farmland frees up labour to work higher up the value chain. You mention freeing up liquid capital for previous landowners to invest, and I'm assuming the idea is that this capital helps create those jobs up the value chain. But isn't there a major risk the liquid capital will simply flow out of the island nations into more abstract financial investment abroad? If the landlords are currently sitting at their desk looking at areal footage, I am sure they'll be even happier watching line graphs tracking foreign stocks. I don't know the policy situation in the Lesser Antilles, but I have to imagine they're generally more open economies than mid-century Asia.

  • Are there any ideas on involving external parties in this? As far as I can see, there are some major international land reform NGOs with interest in the region, and on the study side I can imagine an academic interest in this kind of thing if the land purchases do happen.

  • It seems to me like a lot of the work here has to be boots-on-ground. You mention local guides and such, but will that be enough? Lots of different languages, cultures and legal statuses among those islands -- are you gonna have to basically start from 0 from nation to nation on the on-location contacts and mapping?

  • Do you have any recommendations for reading up on land relations in the Lesser Antilles? Most of the stuff I can find right now seems like it'd be more or less dated.

sclmlw avatar

Mark Webb

9 months ago

@Mio

  1. Will capital flow out of the country? Liquid capital will almost certainly flow out of the country. Many people will likely use the capital infusion to migrate out of their home low-income country. (Based on the interviews I've done this is what I'd predict.) However this is potentially not a bad thing. One of the biggest reasons politically-driven land reform fails is because landowners have a strong incentive to reassert their interest in the land (which government forced them to relinquish). So if we observe emigration, from the island, it's a good bet the former landowners aren't going to try to undermine the project politically.

  2. I am always interested in partnering with people. If you have connections, please let me know. Or you can just suggest "you should reach out to so-and-so" because I'm not shy about a cold contact. I have some relationships in the academic realm, and have gotten great feedback from them. My sense is that there isn't enough money in academia to make something like this happen through academic funding. If you know an organization point me their way and I'll write the grant.

  3. This has, so far, been my biggest struggle working in the Lesser Antilles. There's just not a lot of people in/from those islands total, so it's hard to connect. While I'm working on that, I'm also working connections in other Central American countries. I'm working on submitting an update in the next week or two on some great boots-on-the-ground contacts I've made there, and the wealth of information we're getting from interviews. Lots of positive feedback from tenant farmers about the project.

  4. I'm digging into the history/culture at the moment, as well as following news and other developments. Haven't found anything specific, sorry.

🐼

Jacob Prudent

9 months ago

This intuitively makes sense to me, and I am curious how your research will pan out. Is there a social media account or website I can follow to keep track of this project? Also are you involved in any Georgist organizations?

sclmlw avatar

Mark Webb

9 months ago

@prudentj This is the current place to go for updates. I can't promise any news in the offing, but if you want to be more directly involved let me know.

saulmunn avatar

Saul Munn

9 months ago

i'm skeptical that this will work at-scale. it seems like, for the first purchase or two, this would be a massive help... but eventually, wouldn't the landowners catch on to what you're doing/plan to do, and adjust their prices massively upward? this seems like it would happen fairly quickly, maybe after just 1 or 2 purchases.

there's a fair chance i'm missing something, so please point out where i might be wrong!

sclmlw avatar

Mark Webb

9 months ago

@saulmunn This is a good concern, and one that I've been pondering for some time. Part of why I wanted to start purchases from current landowners, instead of buying land on the open market, is to specifically avoid driving up property values. However, as you suggest if people know there's someone going around buying all the land this will encourage holdouts - which could defeat the whole redistribution project.

One mitigating factor is that I don't think we need to buy 100% of the land to help propel a country down the development path. I'm not sure yet what percent of the land we'll need, but a significant percentage of the tenant farmers will likely be able to transition toward industrial or other non-farm work without us having to buy the land directly.

A concern with this is that landowners who hold out too long may actually have the opposite problem once we no longer need to use land transfers to spur economic growth: that having missed their chance to sell for land transfers, farmland values may not equal what they could have gotten from us. Hopefully, economic growth will make that land valuable for other reasons by that point, and they will not feel that the project has harmed their financial interests.

A big open question is what percent of the land would need to be part of the land transfer to drive self-sufficient economic growth. If we knew this going in, we could start by redistributing that percentage and avoiding the market distortion from the outset ... in theory. In practice, I imagine it'll be a lot more messy and we won't know how much so until we encounter these problems in the real world.

sclmlw avatar

Mark Webb

10 months ago

Does this project need additional funding beyond what Scott contributed? Yes and no.

To get started, no. I'm going to be using the ACX grant to work out the logistics and get a dollar amount for buying a first farm.

Once I've identified an opportunity, I will need additional funding to make the first farm purchase. I'll be seeking additional funding once I get to that point. If you're interested in getting involved at that level, please let me know. I'm considering crowdfunding efforts, along with other potential sources of funding.

saulmunn avatar

Saul Munn

9 months ago

@sclmlw hey mark, i'm happy to hear that you have sufficient funding to get started! once you do start seeking additional funding, you can update this grant proposal to raise the funding bar to whatever you need, or create a new project on Manifund for the specific next steps you plan to have :)