Poverty Reduction through Land Transfers
ONE OF THE MOST ENDURING TENETS of World Bank development policy has been that propertizing reforms have pro-poor effects. The World Bank has emphasized since the 1970s the importance for economic development of transferring agricultural land to the rural and peri-urban poor (Chenery et al. 1974; Deininger and Binswanger 1999; World Bank 1975). Following the fall of the Soviet Union and citing the success of land reforms in China and Vietnam, World Bank experts generally advocated the full and egalitarian distribution of collectively owned land to local populations in post-communist countries (Csaki, Lerman, and Feder 2002; Deininger and Binswanger 1999; Lipton 2009; Swinnen and Rozelle 2006). Broadly following this logic, the fastest pace of “propertizing” land reforms to date was achieved by countries in Eastern Europe, Transcaucasia, and Central Asia, distributing property titles to 145 million hectares of land throughout the 1990s and early 2000s (Dudwick, Fock, and Sedik 2007; Lerman 2017). The expectation was that secure and transferable rights over farmland would incentivize smallholders to work their land more, spend less on enforcing their rights, and—if allowed to trade property titles—use their land as collateral for obtaining bank loans.
For the World Bank, post-communist countries at first constituted the least problematic region, expecting—in contrast to Latin America—few to no complications in the process of “land titling.” If Latin America generally presented the problem of having to redistribute land against the interests of large landowners (De Janvry and Sadoulet 1989; Binswanger, Deininger, and Feder 1995), the post-communist countries of Eurasia were believed to be capable of quickly transferring land to the rural population (Deininger 2003). But while China and Vietnam managed to pull “hundreds of millions of households out of dire poverty” (Swinnen and Rozelle 2006, 1), in Eurasia’s post-communist countries the early years of reform were marked by a tremendous fall in output. World Bank economists documented productivity increases in only those countries that massively reduced agricultural employment (Swinnen and Rozelle 2006; see also chapters 2 and 3). The distribution of millions of property titles to former, pre-communist owners and rural populations did not spur the emergence of a stratum of commercial or entrepreneurial farmers, as expected by reformers, but of millions of “subsistence households,” producing more for self-consumption than for markets. Private ownership seemed too fragmented to allow production surpluses beyond what rural households would use for self-consumption (Csaki, Lerman, and Feder 2002; Deininger 2003; Lipton 2009; Swinnen and Rozelle 2006).
In the largest post-Soviet countries, reforms failed to dislodge or dismantle former collective farms. In Russia, Kazakhstan, and Ukraine, most smallholder households relied on informal arrangements with former collective farms for receiving inputs and marketing outputs (Amelina 2000; von Cramon-Taubadel and Zorya 2001; Yefimov 2003; Zorya 2003). World Bank experts concluded that reforms in most post-Soviet countries were often only “nominal” and that “subsistence agriculture” and the survival of collective farms characterize those countries that halted or aborted reforms (Csaki, Lerman, and Feder 2002; Lipton 2009; Swinnen and Rozelle 2006). The World Bank had expected that land reform—the egalitarian distribution of agricultural land property titles—would turn the poor into producers selling on markets. As this expectation did not materialize, World Bank experts initially suspected the cause to be the insufficient pursuit of reforms. But as land reform unfolded with subsistence and collective farm survival as unwanted companions, the idea of addressing poverty through land transfers in post-communist Europe and Central Asia lost traction. Instead, the World Bank shifted to perceiving “subsistence” agriculture as the main problem stalling rural development and keeping large swaths of rural and semi-urban populations in poverty or forcing them to migrate.
Subsistence: From Dualism to Symbiosis
Subsistence refers to food production destined for consumption within the producing household or to those producers “who sell less than 50% of their production” (Kostov and Lingard 2002; Mosher 1969). It implies a faulty or incomplete relationship with markets. It can characterize not only what people produce for self-consumption but also what inputs they use in producing: subsistence can indicate a farm that does not procure its inputs on markets. Subsistence agriculture implies that a household entirely or largely depends on a form of agriculture for its livelihood that rarely engages with markets and that, because of the low contribution it brings, can at best help the household survive or “subsist,” keeping it in a “vicious” circle of poverty. In other words, the term is used not just to measure or describe low to nonexistent levels of market integration but also to measure or describe (low) living standards and poverty (Heidhues and Brüntrup 2003). As argued below and in the next chapters, most World Bank studies on land reform approach subsistence farming as the opposite of commercial farming, referring to farms selling most production on markets. Those forced to “subsist” on their own production are by definition poor.
In the aftermath of the Soviet Union’s collapse, Eastern Europe, Transcaucasia, and Central Asia entered post-communism with sizable populations owing their livelihoods to agriculture, be it in rural or peri-urban areas on city outskirts. The 1990s, characterized by manufacturing job losses in the millions due to deindustrialization, stabilized or even increased agricultural occupation, thus interrupting (in Russia and Ukraine) or stopping (in Poland and Romania) the decreasing trend in rural population encouraged by communists, while in Central Asia rural populations continued to increase. This situation not only contrasted with highly urbanized Western Europe but was also characterized by a type of agriculture that went on with little mechanization, little commercialization, small land plots, and low—if any—profit rates. Most international advisors and local reformers saw little future in such “small-scale farming,” given its alleged lack of “efficiency” (Sarris, Doucha, and Mathijs 1999). Equated with subsistence, small-scale agriculture seemed a form of “extreme primitivization” (Gaddy and Ickes 2002) that needed to be “overcome,” as “subsistence production entails significant misallocations of resources, especially of human time” (von Braun and Lohlein 2003, 47). The surviving former collectively owned farms (kolkhozy) were seen as facilitators of subsistence agriculture and also as its beneficiaries. Subsistence farmers were thought to “subsidize” the former collective farms by “allowing” the farms to use their land for a very small lease, often paid in kind, and farms “subsidized” smallholders by paying them a lease that was crucial in allowing smallholders to keep small stocks of animals, without, however, incentivizing them to develop production (Koester and Striewe 1999; von Braun and Lohlein 2003). Smallholders and former collective (now corporate) farms thus engaged in a mutually beneficial arrangement that these studies referred to as “dualism” or “dualization,” implying that “entrepreneurial” farmers were squeezed out by the dual structure formed by former collective farms and smallholders. In a line of argumentation that would also appear in World Bank publications and country reports (chapters 2 and 3), the dualist argument emphasized the continuities with the communist past, prompting the comment that land reform was more “imaginary than real” (Yefimov 2003) and was basically derailed by the powerful collective farm “lobby”. Despite claiming that little has changed in the arrangements between smallholders and former collective farms since communism, the same literature identifies one area in which there is a break with the communist past: it claims that because of the abuses of collectivization, the local population is reluctant to establish and enter cooperatives or any associative forms using the same “collectivist” terminology (Gardner and Lerman 2006; Lerman and Sedik 2014; Hagedorn 2014). Such reluctance appeared to contribute to the fragmentation of smallholder farming.
Other observers produced a more nuanced take on small-scale farming. Heidhues and Brüntrup (2003, 16–17) argued in favor of understanding subsistence as “the most rational answer to an adverse environment” and underlined that what passes as subsistence should not be discarded as “non-economic mentality.”1 Research on earlier, pre-communist land reforms suggested a different relationship between poverty and subsistence, arguing that it is the poor that are forced to commercialize or sell the little production they can achieve and that an increase in land holdings might spur self-consumption rather than more commercialization (Mitrany 1951). A rich literature explained post-communist “dualist” arrangements as adaptive reactions to the shock produced by initial reforms (Nikulin 2011, 2012; Visser 2009; Wegren 2005). It underlined the “urban bias” of reforms evident in areas such as price liberalization, subsidy reductions, and the state’s withdrawal from marketing and questioned whether land reform followed pro-poor goals (Wegren 1998, 2005). Others argued that small-scale farming was far too diverse and fluid to fit under the term subsistence easily, and they proposed alternative notions such as “self-provisioning.” Self-provisioning acknowledged that rather than being a sign of “primitivism,” production for one’s own consumption can indicate a desirable and sustainable outcome (Jehlička and Smith 2011; Smith and Jehlička 2013), valued positively by farmers (Ries 2009). Instead of “dualist,” they described the relationship between former collective farms and smallholders as “symbiotic” (Humphrey 1998; Pallot and Nefedova 2007; Visser 2009; Abrahams 1996). Rather than showing “strong psychological resistance to cooperation” (Gardner and Lerman 2006), smallholders establish or enter even production cooperatives (despite the resemblance to collective farms) if expecting efficiency gains and if the state-imposed conditionality is low (Sabates-Wheeler 2002).
This latter perspective stresses continuities with communism too, but it does so not to question the impact of reforms but to show how smallholders matter for food production. Despite forced collectivization, under communism, private agricultural production on small land plots was widespread and outmatched the productivity of collective farms, with 30 percent of agricultural output produced on only 2 percent of the land. Dairy products, eggs, and vegetables often originated in private production (with inputs such as fertilizers often extracted from collective farms), supplementing the incomes of collective farm workers and playing an important part in feeding the cities (Spoor and Visser 2001; Wädekin 1973). The high productivity of small-scale farming relative to larger farms survived communism, with smallholders producing until the 2010s most food (vegetables, milk, and meat) in most post-communist countries, particularly in the largest ones such as Russia, Ukraine, and Romania. Therefore, the role of small-scale farmers appears crucial for these countries’ “food sovereignty” (Visser et al. 2015).
Nor was subsistence a good predictor for the fortune of small-scale farms: several authors argued that depending on the geographical location, small-scale farming seemed to be intensifying rather than declining (Kuns 2017; Pallot and Nefedova 2007; Varga 2016), even if the land reforms demanded by the World Bank were postponed (Ukraine) or seen as deficient (Romania). And the corporate farms’ interest in “symbiotic” arrangements should not be taken for granted: depending on the institutional context and the role played by authorities, corporate farms in certain regions opted out of “symbiotic” arrangements with smallholders (Kurakin, Nikulin, and Visser 2019). What appears problematic from the self-provisioning and symbiosis perspectives is not smallholder agriculture per se but the role of national and supranational actors in forcefully reducing the diversity of agricultural actors in post-communist countries. Such reduction happens as governments and supranational actors—like the European Union—exclude local forms of food production from the wider spectrum of “legitimate economic actors” (Aistara 2009; Mincyte 2011; Roger 2014; Smith, Kostelecký, and Jehlička 2015).
Monetization and the Smallholders’ Internalizing Logic of Action
The symbiosis and self-provisioning arguments contend that subsistence represents a reaction to wide-ranging reforms rather than being a sign of insufficient reform. I take this argument further to suggest that the life-world of smallholders is heavily affected by reforms and that small holders are anything but living in a world of “imaginary” reform. Reforms mean not only what governments officially identify as such but also the wider changes previously introduced by states, now “normalized” and in most situations already taken for granted—that is, not counting as “reforms” anymore. One of the vastest historical reforms to affect peasantry and rural populations across the globe has been the increasing monetization of household needs—that is, the gradual reduction of the “fallback resources” (Scott 1977, 64) available to households and households’ ensuing “growing need for money” (Akram-Lodhi and Kay 2010, 186). The increase in monetary needs is an effect of the growing industrialization of agriculture, state-imposed enclosure acts, and forced dispossession, restricting rural populations’ access to common land, fields, or forests (Akram-Lodhi and Kay 2010). Furthermore, it also reflects increasing taxation, forcing the adoption of crops and breeds that help households meet their monetary needs. In the words of James C. Scott (1977, 21), referring to colonial governments in Ghana and Nigeria, authorities “did what they could to encourage cash-cropping by imposing hut taxes and other levies that would increase the need for cash production.” I will refer to this focus on monetary needs as the “monetization perspective,” presented in detail in part 2.
A key implication of this perspective is that commercialization constitutes a reaction to the poverty caused by declining “fallback resources” rather than the cure to or polar opposite of subsistence and poverty. Poverty forces smallholders to sell whatever they have, including their labor and whatever they can grow on the little land—usually the household plot—they own. From this perspective, one can better understand the reaction of local populations in Eastern Europe to the previous round of propertizing land reform, the pre-communist distribution of land following World War I. In his 1951 study of pre-communist and communist land reforms in Southeastern and Eastern Europe, David Mitrany (1951, 100–101) noted that instead of simply increasing commercialization, post-WWI reforms not only increased subsistence (self-consumption of produce) but also improved the livelihoods of local populations receiving land:
The real change [brought by land reform] was not from large-scale to small-scale, . . . but rather from farming for the market to farming for subsistence. What distinguished the eastern peasant from the western large farmer or peasant farmer was that to him his land was first and foremost a means of raising food for his family and his animals. His production was accordingly diversified and he took to market only the surplus, or perhaps something more if he were in need of cash. A freer use of their crops or even a larger yield meant first of all a higher consumption among the peasants themselves, who formerly had gone short of food or had been living on poor food. “I used to take my geese to market,” was the way a Hungarian peasant put it, “and keep myself on potatoes; now I sell the potatoes and eat the geese.”
Like post-WWI reforms in Eastern Europe, the initial land reforms enacted by communist countries in East Asia and post-communist countries in Eastern Europe and Central Asia, to the extent they took the form of land titling, increased the amount of “fallback resources” at the local population’s disposal. They deeply impacted the livelihoods of those involved but did so in varying ways. In a first group of countries, land reform rapidly dismantled collective farms and distributed land to the population, turning rural and semi-urban dwellers into smallholders. Out of this group, only in China and Vietnam did reforms succeed in turning smallholders into commercial farmers. They lifted them out of subsistence production and poverty by initially keeping a strong state presence in the commercial structures buying up the smallholders’ production and by generally supporting the smallholders’ immediate environment—that is, the larger set of structures and actors determining whether small holders survive and grow, such as local markets of suppliers and buyers (see chapter 2). According to international experts and authors of World Bank publications, a few post-communist countries, located in Transcaucasia and the Balkan peninsula, followed a reform path approximating China’s fast distribution of land (Lipton 2009, 205; see also Csaki and Lerman 1993; Swinnen 2005). In fact, however, they enacted propertizing land reforms with little concern for the smallholders’ immediate environment. Same as roughly seventy years before in Eastern Europe’s post-WWI land reform, the outcome was a highly fragmented, “subsistence” agriculture, far from the productivity gains experienced by China and Vietnam.
As argued in the next chapters, the World Bank, on the one hand, praised these countries as best practices of “propertizing” reforms. On the other hand, it criticized them for failing to enact even more reforms, in particular marketizing and cadastral reforms, seeing subsistence as the direct effect of this failure. Propertizing reforms nevertheless had a profound impact, raising the range and amount of fallback options at the disposal of local populations. With little competition from international retailers throughout post-communism’s first years, local informal markets proliferated, helping smallholders sell production directly or through intermediaries.
The other large group of countries earned heavy criticism from World Bank experts for pursuing less ambitious reforms. This group of countries, referred to as “Russia-like” (Lipton 2009, 205; Swinnen 2005, 18), avoided or postponed dismantling the collective farms and distributed land through shares in collective farms rather than property titles. The largest post-Soviet countries—Russia, Ukraine, and Kazakhstan—fall under this category. However, as argued in this study, land reform had a profound impact also in this group of countries, as it reorganized the relationship between tenant and owner, which in turn facilitated a pattern of informal commercialization. The owners (smallholders) outnumbered the tenants (farms) in the post-reform context, and the owners owed at least part of their livelihood to the capacity of tenants to pay rents—indeed, the post-communist (re)birth of “symbiosis.” Furthermore, tenancy was most often demonetized, as tenants paid for the land not in money but in grain, which owners used as animal fodder. This arrangement limited the cash needs of both owners and tenants: owners (smallholders) received demonetized inputs that fed either them or their animals, while tenants (former collective farms) produced without having to pay rents in cash. In other words, reform was real and lowered the monetary needs in the smallholders’ immediate environments. Here too the reform outcome was subsistence and a pattern of informal and selective commercialization among smallholders.
In both contexts—which Michael Lipton referred to as “China-like” and “Russia-like”—land reform spurred an increase in subsistence, acknowledged in World Bank discourse and seen as the outcome of insufficient land reform, failing to establish land markets in the China-pattern countries and failing to propertize local populations and establish land markets in the Russia-pattern countries. In response, the World Bank and national governments called for land reform to go beyond propertizing. Instead, reform should establish markets and incentivize smallholders to “trade” their property titles, assuming that this will facilitate the differentiation between smallholders capable of increasing operations and those inclined to leave the sector. Furthermore, authorities and international advisors initiated the registration of larger smallholders as a precondition for disbursing state aid, thus seeking to drive the sector’s differentiation further. But land market participation and registration come with increased conditionality and an increase in the monetary burden smallholder households face and, as argued in this book, they are therefore resisted.
The next chapters will focus in detail on the discourse emerging in the World Bank’s knowledge network for coming to terms with land reform outcomes in post-communist countries. In doing so, it follows a broader stream of studies dedicated to national and supranational improvement plans that has long emphasized how national states and supranational organizations design interventions that are bereft of political-economic complications. Thus they avoid political questions by turning them into “technical” issues (Ferguson 1990), “objectivizing” (Escobar 1984) or “simplifying” (Scott 1998) highly diverse populations, territories, and economic relationships (something discussed in more detail in the next chapter). In the context described by this study, the World Bank’s and national governments’ discourse about the outcomes of land reform becomes one about “subsistence” as the result of incomplete reform. Yet this reading, applied to a highly diverse population, operates as a simplification, as it reduces it to one numerical indicator, the size of the land plot, irrespective of whether anyone is actually “subsisting” on agriculture. As a consequence of World Bank and national governments becoming increasingly worried over the high incidence of subsistence, policy goals shifted from pursuing poverty reduction through “propertizing” and “individualizing” the use of land to “consolidation”—that is, overcoming the land fragmentation characterizing subsistence by incentivizing smallholders to increase operations or leave agriculture.
Against this background, this study paints a different picture. Despite or because of the failure to establish land markets, land reform had important demonetizing effects, allowing smallholders to secure control over inputs and allowing an “immediate environment” to emerge that supports smallholders with vital, cheap, in-kind inputs, as well as cash incomes. But this immediate environment and the actors populating it are themselves characterized by fragmentation, informality, and absence of contractual transactions. Consequently, and in contrast to China, the reaction in World Bank discourse and national policies has been to dismiss this environment and call for its containment through “commercialization” and inclusion of smallholder economies into global value chains. In other words, land reform brought two developments that take center stage in this book and that the World Bank had not intended and, therefore, dismissed or condemned: an increase in subsistence, coupled with a pattern of prudent and informal commercialization “from below” among smallholders.
Overview of This Book
The book’s first part (chapters 1 to 3) focuses on the World Bank land reform discourse. Chapter 1 analyzes the World Bank’s land reform program as encapsulated in key publications appearing in the 1990s. It shows where and how land reform ideas compromised with neoliberalism, arguing, based on World Bank oral history interviews, that the World Bank’s land reform proposals constitute a compromise between the neoliberal focus on structural adjustment and critical receptions of World Bank policies following the Green Revolution. The chapter further argues that the impact of neoliberalism was not so much the stress on markets as a reduction of markets to private property, translating into an emphasis on only a very narrow set of institutional reforms. This narrow set of institutional reforms—the land reform program—informed post-communist countries’ approach to poverty and transforming agriculture. Before reaching the post-communist countries, the land reform program incorporated one more ingredient: the use of China as reform benchmark for post-communist countries.
Chapter 2 argues that World Bank experts drew support for land reforms in post-communist Eurasia from a selective reading of China’s early 1980s “market-making” reforms. The Bank’s treatment of Chinese policies reduced them to their land reform component and ignored the state’s role as subsidizer and buyer of poor people’s production. This simplified version of China’s reforms—turning poverty reduction into one institutional “fix” to be settled by introducing property rights—became an important reference for the post-communist countries of Eastern Europe, Transcaucasia, and Central Asia that undertook land reform. The chapter shifts from the key World Bank publications treated in chapter 1 to country-level reports produced by the World Bank about four post-communist countries: Moldova, Romania, Tajikistan, and Ukraine. This change from publications with global reach to country-level reports seeks to check whether and how the Bank’s general expectations differ from what reformers find on the ground and whether such findings, if different from expectations, lead to a reformulation of policies. According to the World Bank, the four countries differed in their government’s ability and capacity to implement land reforms: the poorer, small former Soviet republics of Moldova and Tajikistan are considered relatively good performers, while Romania and Ukraine earn continuous critique for their levels of subsistence. The World Bank initially emphasized land reform as a central mechanism for addressing rural poverty worldwide: land transfers help to turn the poor into smallholders while land markets help to turn smallholders into commercial or entrepreneurial farmers. While these reform steps seem to support each other, the analysis of twenty-five years of World Bank reports on land reform in the four post-communist countries finds that the two steps—land transfers and commercialization—develop in a tension unacknowledged at the level of more general publications. The analysis shows that by the end of the 2000s, World Bank–inspired policies prioritized commercialization over addressing poverty reduction, and the underlying understanding of poverty had changed from poverty as lack of farmland to poverty as lack of alternatives to farming. Furthermore, even though later seen as a sign of underdevelopment, the subsistence capacity of local populations following land transfers was in earlier reports acknowledged and encouraged. The expectation was that subsistence would support the commercialization of agriculture as price and trade liberalization would incentivize producing for export and relieve welfare systems.
Chapter 3 combines the focus on discourse with an analysis of how outcomes of land reform in post-communist countries fared against each other and against reform outcomes in China and Vietnam. Several points emerge from the comparison. First, some countries switched categories from Russia-like to China-like, increasingly handing out property titles and corresponding land parcels to local populations. Yet this hardly impacted the prevalent pattern of subsistence or helped to reverse dualization. Second, the reforms’ impact on poverty was often left out of sight and replaced with a focus on productivity or the extent of individualization of land use or property rights. Finally, there hardly were numerical indicators measuring subsistence at the level of smallholder farms other than the size of the land plot, as productivity measures tended to reflect official total output data. Thus, small farms with land holdings below two hectares were seen as practicing subsistence farming simply based on their land plot size. This strengthened the impression that smallholders generally failed to engage with markets. The problem, therefore, in the World Bank’s perspective was not so much the failure of having pro-poor results but the decreasing control over smallholders perceived to have withdrawn from “markets” into “subsistence.” Subsistence became an effect of anything but reforms, having little to do with markets. The next chapters offer a contrasting perspective.
Part 2 starts with a detailed description of a fieldwork study of smallholders and subsistence and agricultural value chains pursued in the Ukrainian-Romanian border region of Bukovina (chapter 4). The rationale for selecting the Bukovina region was that this historical region currently belongs to two countries with contrasting approaches to land reform. One is presented as China-like (Romania), the other as Russia-like (Ukraine), with differing speeds of dismantling communist village institutions and propertizing local populations: fast in Romania, slow in Ukraine. Nevertheless, on both sides of the border, the region features very high numbers of smallholders, which authorities characterize as practicing subsistence agriculture. This similarity in outcome allows research to move beyond statements reducing subsistence to lack of land reform and explore the hypothesis that the labelling of informal economic activities as “subsistence” hides important developments treated in detail in chapter 5: the informal commercialization observable among smallholders irrespective of the pattern of land reform enacted and the consolidation through decreasing smallholder numbers from the 2010s on.
Chapter 5 returns to the observation—confirmed by the World Bank and the Food and Agriculture Organization—that in most post-communist countries, smallholders produce some of the most basic food staples and until the mid-2000s were generally the source of most of the food produced in these countries. Since the fall of communism, they have managed to increase production and the land they work, even though their numbers start to decrease in the 2010s. The increasing smallholder production is a puzzling development since smallholders had little to no access to credit markets and formal investment, as most were or still are unregistered and said to practice subsistence production. The chapter contends that the tendency among smallholders is not one of growth toward and through economies of scale but one of self-provisioning, understood as organizing production so as to internalize production steps and demonetize costs and growing to control upstream and downstream links in their respective value chains. It asks what makes such demonetization possible in the fieldwork area and identifies various features of the smallholders’ environments, such as a diverse scene of intermediaries supplying smallholders with cash incomes. It draws attention to the mixed-income household (the notion it uses instead of “subsistence” farms) as the numerically dominant presence in the post-communist rural landscape, combining incomes from agriculture (and other forms of informal self-employment) with incomes from welfare transfers and wage work. How such households interact with larger local producers is crucial for the latter, allowing them to increase informally the land at their disposal or enter deals with traders. The research implies that the features of their immediate environments are crucial for the smallholders’ growth and survival and should be valued accordingly rather than dismissed in favor of integrating smallholders into the retailer-and supermarket-dominated value chains of the global food economy.
The first two chapters in part 2 centered on issues of resilience—that is, on how smallholders survive and grow in their immediate environment despite authorities treating them as subsistence farmers. But from Central Asia to Eastern Europe, the strong showing of smallholders is a source of embarrassment for national governments. Chapter 6 turns to “resistance,” or economic practices and mental attitudes imputed by authorities to smallholders. To curb subsistence farming, the World Bank and authorities call for or promote measures seeking the “commercialization” of smallholder agriculture. Commercialization is about increasing the smallholders’ monetary needs rather than facilitating the small holders’ access to markets or acknowledging those markets where they already operate. Markets are not just supposed to help small-scale farmers access investments and credit but are expected to discipline a sector perceived as alien to “business orientation” and owing its existence not to markets but to the surviving structures of the communist past, such as the former collective, now corporate farm, as well as to its “subsistence mentality.” The resistance imputed to smallholders and others is their very operation in conditions of informality, the land use patterns they practice, and the rejection of state programs incentivizing them to adopt more profitable crops and animal breeds or to establish and join cooperatives. But the chapter argues that instead of facilitating formal commercialization, state actions fail to reduce the involvement of smallholders and their environments in the informal economy.
The final chapter concludes by noting how international organizations and national governments continue to approach rural and peri-urban populations as caught in subsistence and to devise programs to “pull them out” of it, such as commercialization. It revisits the discussion of land reform in China and post-communist countries by pointing out how the World Bank’s narrative about China’s reforms completes its broader treatment of East Asia’s developmental path. Post-communist countries become further evidence that this developmental path, as the World Bank depicted it, has nothing new to add to its depiction of pro-poor development: namely, that what it mainly takes is an effort to introduce a narrow set of “pro-market” institutions such as property rights over productive assets and markets for property rights. But actual developments in post-communist Eurasia show that there was a lot to learn from the enactment of land reform and its outcomes. The findings of this study show that poverty reduction and the development of entrepreneurship are irreconcilable goals if they involve only the transfer of productive assets. And they further show that land reform, even if falling short of establishing land markets, in fact created several mechanisms that favored the differentiation of commercializing informal producers and traders from smallholders. This differentiation hardly happened at the expense of smallholders and required close interaction between the latter and commercializing actors. Given its informality, this post-reform environment hardly benefits from the protection of authorities and attention of international organizations. Still, its existence holds the key to understanding the resilience of small-holder agriculture.