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Robin Hood’s compromise : the economics of moderate land reforms

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  • Bandiera, Oriana
  • Levy, Gilat

Abstract

This paper analyses the consequences of an unusual type of land redistribution; we take land from the very rich, as usual, but give it to the rich instead of the poor. We show that such “moderate” reform reduces agency costs and thereby increases productivity, total surplus in the economy, and the welfare of rural workers. Compared to the classic redistribution ”to the tiller”, moderate reforms do worse in terms of equity and do not give the poor a collaterizable asset. They can however do equally well in terms of efficiency and might be more sustainable both financially and politically.

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  • Bandiera, Oriana & Levy, Gilat, 2004. "Robin Hood’s compromise : the economics of moderate land reforms," LSE Research Online Documents on Economics 542, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:542
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    File URL: http://eprints.lse.ac.uk/542/
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    More about this item

    Keywords

    land reform; moral hazard;

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics

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