South Africa’s land redistribution: an agent-based model for assessing structural and economic impacts

Summary

South Africa’s land redistribution aims to redress the historical injustices of apartheid. This paper evaluates the efficacy of an agent-based model to support and refine the process. Using the Impacts of Land Use Patterns in South Africa model, developed from surveys of 658 commercial farmers and 833 commercially oriented smallholders, we simulate three scenarios: the current willing seller, willing buyer mechanism as our baseline, a second scenario that includes land subdivision to produce emerging farm parcels, and a third scenario that includes expropriation of underperforming farms. We find that the current mechanism is likely to redistribute only 14% of the targeted 30% of commercial farmland. Including land subdivision increases the number of beneficiary farms from 4,383 to 73,600, improving access to land but reducing farm sizes and thus possibly economic sustainability. Including expropriation adds about 2.4 million hectares, mainly for grazing, with a small allocation for field crops and horticulture. All three scenarios could reduce production volumes, with marked differences in impact across agricultural subsectors in the subdivision scenario. Realising these scenarios over an eight-year period is projected to require substantial financial investment, with estimated costs ranging from R422 billion to R626.9 billion, heavily weighted towards operational capital to maintain farm productivity and viability. The study demonstrates the model’s value for policymakers, enabling them to explore and evaluate the outcomes of different land redistribution strategies, ensuring more informed and effective policy-making.