What is it about?

This chapter seeks to address an issue that has been barely examined in the scholarship of postsocialist land reform: the reinvention of land mortgage as a means of transforming agrarian relations in formerly socialist countries. After five decades of socialist organization of the agrarian economy, mortgage has returned as a tool to reshape and financialize the agriculture in Romania. During the socialist era when productive land was concentrated into state and collective farms, local agricultural communities saw an almost complete elimination of real property rights. Romanian landholding has been historically diverse and governed by inequalities and social differentiation. Much of the income of rural inhabitants was derived from informal or side activities during the socialist as well as postsocialist periods, and smallholdings remained intermeshed in broader work-exchange networks. We argue that in such transitional settings, formalization of land claims is a contested and political process. The chapter draws on academic literature and policy documents on postsocialist land reform in Eastern Europe and Romania, and data from ethnographic field research. It focuses first on the pluralist dynamics of land formalization in Romania, while exploring the forms of rural production, property holding and authority throughout the recent history. It presents a history of mortgage and bank loans in pre-socialist and socialist Romania, and discuss the challenges of land-based lending in Romania as relating to incomplete cadastres, land fragmentation, and other issues that accompanied postsocialist land restitution. Examining rural lending in Romania through the perspectives of lenders as well as borrowers, the chapter presents a multifaceted analysis of the still very scarcely explored issue of postsocialist land-based lending.

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Why is it important?

Our study foregrounds the importance of undertaking more systematic ethnographic and policy-oriented research into rural lending in postsocialist societies—an area of inquiry that still tends to remain in the shadows.

Perspectives

Land claims and transactions continue to be embedded in interpersonal networks and norms of mutuality. At the same time, legal and administrative devices to manage real property have evolved toward growing exclusion of lateral claims, use rights, and ownership histories. This imbalance has a potential to deepen dispossession of low-income mortgagors globally who use their informal networks to manage their formal credit obligations and extend their everyday norms of mutuality to the anonymous mortgage markets increasingly managed through algorithms. The “new” mortgage borrowers in the Global South may be especially vulnerable.

Daivi Rodima-Taylor

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This page is a summary of: CHAPTER 7 Reinventing Land Mortgage in Postsocialist Europe: The Romanian Case, December 2022, De Gruyter,
DOI: 10.1515/9781800733497-011.
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