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The effects of agrarian contracts of a governmental intervention into bonded labor in the western terai of Nepal

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  • Magnus Hatlebakk

Abstract

We study an effective intervention into a specific form of bonded labor. The intervention led to a shift in agrarian contracts, from bonded labor to sharecropping. By comparing the pre- and post-liberation contracts we evaluate theoretical models of agrarian contracts. We suggest three mechanisms that jointly explain why landlords offered bonded labor contracts pre-liberation. One mechanism we apply to define bonded labor in contrast to tied labor. The mechanism, where the outside option as casual labor is endogenously determined by the choice of long-term contract, implies a trade-off for the landlord between efficiency and redistribution of surplus.

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Bibliographic Info

Paper provided by CMI (Chr. Michelsen Institute), Bergen, Norway in its series CMI Working Papers with number WP 2006: 6.

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Length: 40 pages
Date of creation: 2006
Date of revision:
Handle: RePEc:chm:wpaper:wp2006-6

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Keywords: Tied labor Agrarian institutions Nepal;

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References

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  1. Bardhan, Pranab K, 1980. "Interlocking Factor Markets and Agrarian Development: A Review of Issues," Oxford Economic Papers, Oxford University Press, vol. 32(1), pages 82-98, March.
  2. Allen, Franklin, 1985. "On the Fixed Nature of Sharecropping Contracts," Economic Journal, Royal Economic Society, vol. 95(377), pages 30-48, March.
  3. Bardhan, Pranab K, 1983. "Labor-Tying in a Poor Agrarian Economy: A Theoretical and Empirical Analysis," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 501-14, August.
  4. Joseph E. Stiglitz, 1973. "Incentives and Risk-Sharing in Sharecropping," Cowles Foundation Discussion Papers 353, Cowles Foundation for Research in Economics, Yale University.
  5. Shetty, Sudhir, 1988. "Limited liability, wealth differences and tenancy contracts in agrarian economies," Journal of Development Economics, Elsevier, vol. 29(1), pages 1-22, July.
  6. Schaffner, Julie Anderson, 1995. "Attached farm labor, limited horizons and servility," Journal of Development Economics, Elsevier, vol. 47(2), pages 241-270, August.
  7. Hatlebakk, Magnus, 2004. "Attached Labor in Nepal: A Field-Study of Landlord-Labor Relations that are Misrepresented in the Nepal-LSMS data," Working Papers in Economics 02/04, University of Bergen, Department of Economics.
  8. Hatlebakk, Magnus, 2002. "A new and robust subgame perfect equilibrium in a model of triadic power relations," Journal of Development Economics, Elsevier, vol. 68(1), pages 225-232, June.
  9. Genicot, Garance, 2002. "Bonded labor and serfdom: a paradox of voluntary choice," Journal of Development Economics, Elsevier, vol. 67(1), pages 101-127, February.
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Cited by:
  1. Espen Villanger, 2006. "Is bonded labor voluntary? A framework against forced work," CMI Working Papers WP 2006: 7, CMI (Chr. Michelsen Institute), Bergen, Norway.
  2. Koolwal, Gayatri B., 2007. "Son Preference and Child Labor in Nepal: The Household Impact of Sending Girls to Work," World Development, Elsevier, vol. 35(5), pages 881-903, May.
  3. Espen Villanger, 2006. "Is Bonded Labor Voluntary? Evidence from the Liberation of the Kamaiyas in the Far-Western Region of Nepal," CMI Working Papers 16, CMI (Chr. Michelsen Institute), Bergen, Norway.

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