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Land Sector Corruption in Ethiopia 295
Corruption and Land Governance
Corruption occurs during implementation of the chain of activities set
out above, through abuse by those responsible for making decisions.
Investigations of corruption in the land sector often distinguish between
two levels of corruption, both of which are significant:
• State capture, or the illegal conversion of state assets to private use
where there are examples of corruption on a grand scale
• Petty corruption or maladministration, including officials’ solicitation
(either directly or through middlemen) of illegal or informal payments
in return for processing routine work or overlooking often ill-defined
restrictions or requirements.
Recent studies have shown that petty corruption can have significant
financial cost. A study in India estimated that petty corruption in that
country’s land sector has a monetary value of about US$700 million per
year (TI India 2005). In China, the loss of income from corrupt land transactions
is estimated to be about US$1.25 billion per annum (People’s Daily
Online 2006). However, as both reports noted, petty corruption has a far
wider impact than the purely monetary losses to government revenue: the
widespread imposition of informal fees in the land sector undermines
public trust in government and can be a serious barrier or disincentive to
participation, particularly by the poor and disadvantaged.
The fundamental nature of land, both socially and economically,
implies a unique and important role for the state and thus a particular set
of concerns related to governance. The supply of land is fixed. Land is an
important factor of production, particularly in agriculture. Establishing
and protecting claims to land is an important concern of producers.
Research in a variety of settings has shown that secure property rights can
be provided more cost-effectively on a collective rather than private basis
(De Meza and Gould 1992). In this sense, a secure property rights system
has aspects of a public good and is thus appropriately provided by the
state (Shavell 2003).
In addition to these economic justifications, security of tenure is
important on social grounds. Protection from forced evictions is
increasingly seen as a basic human right, acknowledged as part of the
Millennium Development Goals. Ensuring equity of property rights
protection is another important concern. In many cases, the poor, ethnic
minorities, and women face particular obstacles in obtaining equally
secure land rights.