Authors: Economic Policy Research Network (EPRN Rwanda)
Published: 24 December 2025
DOI: https://doi.org/10.64116/Report.2025.LandReformRwanda
This publication is funded by the German Federal Ministry for Economic Cooperation and Development (BMZ) and supported by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. The views and opinions expressed in this publication are those of the authors and do not necessarily reflect the official position of BMZ or GIZ.
Executive Summary
Globally, it has long been recognised that agriculture is a source of livelihood for poor rural households and the engine of economic growth, mainly in developing countries. However, the effect of land fragmentation, small-scale agricultural holdings, and farms divided into many small parcels have been a significant challenge to increasing agricultural productivity, improving food security, and achieving poverty alleviation in those countries. Like many other developing countries, Rwanda has implemented the Land Use Consolidation (LUC) Policy since 2008 to overcome the negative effects of land fragmentation and land parcellation on livelihoods. The literature has sufficiently discussed the effect of LUC on agricultural productivity, food security, adoption of agricultural technologies, use of improved agricultural inputs, and environmental degradation. However, little is known about the effect of LUC on household wealth accumulation. To contribute to knowledge and policy discussions, we investigate the effect of integrating agricultural land into the LUC program on household wealth accumulation and the role urbanisation could play. This study uses data from Rwanda’s 2015, 2018, and 2021 Comprehensive Food Security and Vulnerability Analysis surveys. We hypothesise that households for which agricultural lands are integrated into the LUC program are more likely to have good livelihoods and wealth accumulation, assuming that LUC contributes to improving livelihood activities and household food security status through increasing agricultural productivity.
Evidence from ordered probit regression models’ estimations revealed that integrating agricultural land into the LUC program is associated with a significant improvement in wealth accumulation among households adopting the LUC program. The moderation and marginal effect estimates showed that urbanisation helps achieve a more significant effect of LUC in improving household wealth accumulation. From a policy perspective, these findings suggest that implementing a land use consolidation policy supported by urbanisation would be crucial in significantly improving wealth accumulation in Rwanda. This accompaniment of the LUC program and urbanisation would also play a key role in supporting the country to achieve inclusive growth and its ambition of becoming a Middle-Income Country by 2035 and a High-Income Country by 2050. Our results also show that variables such as being a male head of household, education level of the household head, access to credit, household size, and age of the household head have a positive and significant effect on the household’s likelihood of shifting from a lower to a higher wealth category.
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