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A new scramble for land or an unprecedented opportunity for the rural poor? Distributional consequences of increasing land rents in developing countries

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  • Hvid, Anna Kirstine
  • Henningsen, Geraldine Adrienne
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    Abstract

    Price induced increases in land rents trigger an increasing incentive for rent-seeking behavior. To analyse distributional and welfare effects of increasing land rents in developing countries, we develop a game theoretic model where a large and heterogeneous group of farmers competes with a small and wealthy elite. The results indicate that only relatively small rent increases benefit the farmers more than the elite. Moreover, political institutions have an ambiguous effect on farmers’ rent share, and may even reduce overall welfare, because they induce wasteful expenditure on rent-seeking.

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    Bibliographic Info

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 52919.

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    Date of creation: 13 Jan 2014
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    Handle: RePEc:pra:mprapa:52919

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    Keywords: rent-seeking; land rents; agricultural prices; biofuels; natural resources;

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