Political economy of farm fragmentation in Vietnam

The average number of non-contiguous plots held by a single farm household in the Red River delta is 7-8. In the Mekong delta the number is only 2. So fragmentation, if it is a problem, is a northern problem, especially when you consider that many of these plots are only 200 or 500 square metres (for non-metric readers, 500 m2 is about 1/8 acres). Average total farm size in the RR delta is 2,500 m2 and in the Mekong delta it is 1.2 ha.

Fragmentation has disadvantages - chiefly that you lose land on account of the numerous boundaries (wet rice fields are usually surrounded by a small bund). you sometimes have to travel longish distances between plots, adding to your workload, and it is non-conducive to the use of farm machinery and some other new technologies. The advantages are that poor farmers can minimize risk by growing different crops on different plots - one of the reasons for fragmentation is that distribution was carried out in such a way as to equalize access to different soil types. So basically each household has access to some fairly good flat rice land and some other soil qualities (for example, hillside, flood-prone, rocky, near the road, far from the road, sandy, etc - whatever the locality happens to have).

Under the 1993 Land Law, households were given use rights to these plots. Each household was assigned an area of land based on the number of people in it. The land can be transferred (a euphemism for 'sold'), inherited, mortgaged, rented in or out, during the lifetime of the household's tenure (20 years for annual crop land, 50 years for perennial crop land). The state retains ownership of the land and has the right to redistribute plots upon the expiry of tenure (this is an ancient Vietnamese tradition). Periodic redistribution is necessitated, either for egalitarian reasons or in order to maintain social peace, by the fact that, over time, many people become landless. People born since the first distribution in 1993, for example, and women who marry into a village were not in the headcount at the time the land was distributed. On the other hand, people die or move away and those who inherit their land tend to have more than the rest.

Interestingly, according to a study I read yesterday,* these tiny fragmented farms are no less productive than larger farms. The only significant difference between these and the larger farms is that they absorb a lot more labour. If more people move out of farming so that labour to work these plots becomes scarce, then they will certainly become a lot less productive. As it is, many of these workers are underemployed for much of the year. There isn't a huge amount to do a lot of the time, but the demand for labour is round-the-clock at peak times like harvest.

The government has a policy of land consolidation. This was in fact one of the basic rationales for collectivization in the first place - the idea that working larger plots of land would be more efficient. Households are encouraged to swap plots in order to increase the size of individual plots. The process is fraught with difficulty, however, and not a lot has happened. Farmers find, for now, that fragmentation is more advantageous than disadvantageous. It encourages crop diversification and risk reduction. But there's also a major political problem related to who is going to get the lion's share of the good land and whether some families are going to end up growing less profitable rice, while others have more profitable cash crops. On the other hand, fragmentation discourages entrepreneurship (read emergence of capitalist farmers).

Women, as usual, get the worst end of the stick. This is not mentioned in the paper I read. But each household is supposed to have a Red Book detailing the plots of land allocated to it. The law says that the two names of husband and wife should be registered as owners of the usufruct. This is a socialist ideal that is out of sync with village reality. Mostly only husbands have their names in the Red Book. The reason is that Vietnam is traditionally patrilocal and patrilineal. Women move into their husband's family's household and land when they marry. If a couple become farmers, it is very often on land given to the son by his parents. If the son meets with an accident, or gets divorced, there is no way those parents want the land becoming the property of their daughter-in-law! Back in her home village, the wife's family was allocated some land in 1993, but since she has left the village and cannot farm there, the land remains under the control of her father.

This is why divorce in the rural areas is extremely rare. A woman who initiates a divorce is likely to end up with nothing. She'll be thrown off her in-laws' land and, even if she goes home she's unlikely to be welcome as her brothers and their families will have taken over the farming of her share of the land.

One last point about the lack of entrepreneurship. While it prevents the development of capitalist agriculture in the normal sense of emerging family-based businesses run for profit (as distinct from farming for subsistence), it does not prevent the emergence of capitalism in agriculture. Fragmentation makes land consolidation difficult, so it encourages the intensive application of labour to the fields. But this self-exploitation by the labourers is actually highly productive. Enough is produced that a portion of the crop may be sold to the market. The market, however, is monopsonistic - meaning that there are few buyers, mainly state-owned trading companies, and prices paid to farmers are low, while profit margins of the traders are high. In other words, the instensive labour of the farmers (notably the women) is lining the pockets of urban trading companies.

*Pham Van Hung, T. Gordon MacAulay and Sally P. Marsh, 'The Economics of Land Fragmentation in the North of Vietnam', 48th Annual Conference of the Australian Agricultural and Resource Economics Society, Melbourne, February 2004.