Large-Scale Land Acquisition and Household Farm Investment in Northern Ghana

Abstract

Many studies have investigated the effects of large-scale land acquisition (LSLA) on livelihood, while the effects of LSLA by different actors on investment decisions and levels of investment have largely gone without academic scrutiny. Consequently, information concerning the implications of LSLA by actors on investment is scarce in the literature pertaining to policy. Drawing on information from 664 households selected through a multistage sampling technique, this study examined the relationship between direct and indirect exposure to LSLA by domestic and foreign entities and investment in land-improving techniques. The results show a bi-directional relationship between LSLA and household farm investments. While direct and indirect exposure to LSLA by domestic and foreign entities dissipates some forms of farm investments, the reverse causality is also possible where some household farm investments discourage direct and indirect exposure to LSLA by domestic and foreign entities. The results also revealed that LSLA by domestic and foreign entities dissipates investment in all levels of land- and yield-improving techniques, and even in the presence of a high perception of tenure security. Thus, the provision of legal ownership of land to farmers can provide insurance for investments in all land-improving techniques. Government can also step up the fertilizer subsidy program to enable households to increase investment to avoid further exposure to LSLA.