Impacts of a Mandatory Shift to Decentralized Online Auctions On Revenue from Public Land Leases in Ukraine

We analyze the impact of a 2021 reform in Ukraine that—after earlier digitization efforts did not produce desired results—mandated use of transparent online auctions by local governments rather than a central agency to lease rights to public agricultural land. The shift to a collusion-proof electronic auction system increased lease revenue by 175% for our preferred specification. Had all public land that Ukraine transferred since 2015 been auctioned using post-reform mechanisms, local governments would receive incremental lease revenue of US$500 million per year for the duration of the lease. Where public land is important, reforms to ensure rights to such land are allocated transparently, competitively and in a decentralized way could improve social, economic, and environmental outcomes.