Bolivia's land reform policies of the early 1950s were implemented much more rapidly and completely than those of other Latin American countries. The land reform essentially allowed peasants to claim the land that they had traditionally worked. For this reason, however, the size of many peasant plots did not increase as a result of the reform.

In retrospect, land reform was more of a social success than an economic one. Although the reform improved income distribution, its main contribution was to transform a feudal society into a market society. Land reform has remained a goal of successive governments since 1952, but the pace and scope of reform slowed. The original Agrarian Reform Law was amended in 1963 and 1968. By 1986 the government claimed to have redistributed 33 million hectares through the reform process. But although peasants ate better, agricultural production did not increase in the way most government officials expected. In addition, the reform process was hampered by price controls, a lack of extension services, inadequate credit, insufficient infrastructure, and regional conflicts between the highlands and lowlands. The growth of the agricultural sector was barely positive during the 1950s, and annual growth, especially among food crops, did not keep pace with population growth, thus requiring increased imports of foodstuffs.

Land policy since 1952 also has been marked by the colonization of the lowlands. Although government policy has encouraged colonization of these isolated areas since the 1940s, the process did not accelerate until the 1950s, when a major highway connected Cochabamba with Santa Cruz and a rail system linked Santa Cruz with São Paulo, Brazil (see Transportation , this ch.). The settlers included members of the former ruling oligarchy who had lost land in the reform, as well as more risk-taking highlanders, or Kollas (see Glossary), who came as wage laborers or who bought land. In order to facilitate the colonization process, the government created the National Colonization Institute (Instituto Nacional de Colonización--INC), which typically helped highland families move to newly established government colonies, sometimes completely isolated from other towns. From 1952 to the mid-1970s, the government helped 46,000 families (190,000 people) colonize the lowlands. Governmentsponsored colonization, however, accounted for just 15 percent of all the pioneers who ventured east. Furthermore, INC colonies suffered a high dropout rate among participants, many of whom faulted the INC for providing insufficient support services and too few roads. Other settlers included members of Japanese and North American Mennonite communities who were establishing colonies in neighboring Paraguay.

Land policy and government agricultural policy in general shifted dramatically when orthodox economic policies were implemented in 1985. The government, which had once monopolized the production of many key crops, set prices, marketed goods, and cl25c closely controlled credit, now effectively withdrew from the sector. As a result, farmers in the late 1980s were in transition from a period characterized by import protection and close cooperation with the government to one of free competition with highly advanced international markets and contraband.

Data as of December 1989