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By Dharam Ghai, Azizur Rahman Khan, Eddy Lee, Samir Radwan

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As regards land and income distribution, the initial period of agrarian reform witnessed a definite reduction in inequality and a Alternative Agrarian Systems in the Third World 15 drop in the magnitude of absolute poverty. But by the beginning of the 1970s the equalising effects of the reform were thinning out, and this, together with a rapid population growth, explains the increase in inequality and impoverishment. After 25 years of agrarian reform, we find that the initial inequalities in rural Egypt were not fundamentally diminished: 40 per cent of the households were landless and 35 per cent lived in poverty.

1 illustrate this point clearly. At the same time, however, the sizedistribution of operating units changed only slightly. 1 per cent. 1 per cent. 1 2172 2249 Source Robert B. Morrow and Kenneth H. Sherper, 'Land Reform in South Korea', Agency for International Development Spring Review (Washington: June 1970) Tables 5 and 7. The Case of South Korea 27 with respect to ownership and without any substantial change in the configuration of production units. The effect of the redistributive change, however, also affected production incentives positively and widened the 'absorptive capacity' of the agricultural system for investment and technical change.

Finally, the question of incentives for the agricultural sector as a whole is linked up with the question of the extraction of resources out of agriculture through taxation or the imposition of unfavourable terms of trade. Unless such resource extraction is modest the agricultural sector would be subject to serious disincentive which would be transmitted downward to affect adversely the incentives of the collective units and individuals. In some early experiences of collectivisation, excessive extraction of resources through such means was undoubtedly the chief factor in explaining slow growth.

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