Property rights in a flea market economy
AbstractThis paper studies liberalised grain markets in Madagascar and examines how property rights are protected and contracts are enforced among agricultural traders. We find that the incidence of theft and breach of contract is low, and that the losses resulting from such instances are small. This, however, does not result from reliance on legal institutions - actual recourse to police and courts are fairly rare, except in cases of theft - but from traders` reluctance to expose themselves to malfeasance. As a result, Malagasy grain trade has high transactions costs, and little or no forward contracting. The dominant contract enforcement mechanism is trust-based relationships. Trust is established primarily through repeated interaction with little role for referral by other traders. Information on bad clients does not circulate widely, hence severely limiting group punishments for non-payment.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number WPS/1999-25.
Date of creation: 01 Nov 1999
Date of revision:
Other versions of this item:
- Marcel Fafchamps & Bart Minten, 1999. "Property rights in a flea market economy," CSAE Working Paper Series 1999-25, Centre for the Study of African Economies, University of Oxford.
- Fafchamps, Marcel & Minten, Bart, 1999. "Property rights in a flea market economy," MTID discussion papers 27, International Food Policy Research Institute (IFPRI).
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marcel Fafchamps & Bart Minten, 1999.
"Relationships and traders in Madagascar,"
Journal of Development Studies,
Taylor & Francis Journals, vol. 35(6), pages 1-35.
- Kathryn Hendley & Peter Murrell & Randi Ryterman, 1998.
"Law, Relationships, and Private Enforcement: Transactional Strategies of Russian Enterprises,"
Electronic Working Papers
98-001, University of Maryland, Department of Economics.
- Kathryn Hendley & Peter Murrell & Randi Ryterman, 1998. "Law, Relationship, and Private Enforcement: Transactional Strategies of Russian Enterprise," William Davidson Institute Working Papers Series 72, William Davidson Institute at the University of Michigan.
- Messick, Richard E, 1999. "Judicial Reform and Economic Development: A Survey of the Issues," World Bank Research Observer, World Bank Group, vol. 14(1), pages 117-36, February.
- Berg, Elliot, 1989. "The liberalization of rice marketing in Madagascar," World Development, Elsevier, vol. 17(5), pages 719-728, May.
- Marris, Peter, 1971. "African Businessmen in a Dual Economy," Journal of Industrial Economics, Wiley Blackwell, vol. 19(3), pages 231-45, July.
- Braguinsky, Serguey, 1999. "Enforcement of Property Rights during the Russian Transition: Problems and Some Approaches to a New Liberal Solution," The Journal of Legal Studies, University of Chicago Press, vol. 28(2), pages 515-44, June.
- Kranton, Rachel E, 1996. "The Formation of Cooperative Relationships," Journal of Law, Economics and Organization, Oxford University Press, vol. 12(1), pages 214-33, April.
- Gary S. Becker, 1968.
"Crime and Punishment: An Economic Approach,"
Journal of Political Economy,
University of Chicago Press, vol. 76, pages 169.
- Barrett, Christopher B., 1997. "Food marketing liberalization and trader entry: Evidence from Madagascar," World Development, Elsevier, vol. 25(5), pages 763-777, May.
- Greif, Avner, 1993. "Contract Enforceability and Economic Institutions in Early Trade: the Maghribi Traders' Coalition," American Economic Review, American Economic Association, vol. 83(3), pages 525-48, June.
- Barrett, Christopher B., 1997. "Liberalization and food price distributions: ARCH-M evidence from Madagascar," Food Policy, Elsevier, vol. 22(2), pages 155-173, April.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Caroline Wise).
If references are entirely missing, you can add them using this form.