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Incentives, supervision, and sharecropper productivity

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  • Jacoby, Hanan G.
  • Mansuri, Ghazala

Abstract

Although sharecropping has long fascinated economists, the determinants of this contractual form are still poorly understood and the debate over the extent of moral hazard is far from settled. The authors address both issues by emphasizing the role of landlord supervision. When tenant effort is observable, but at a cost to the landlord, otherwise identical share-tenants can receive different levels of supervision and have different productivity. Unique data on monitoring frequency collected from sharetenants in rural Pakistan confirm that, controlling for selection,"supervised"tenants are significantly more productive than"unsupervised"ones. Landlords'decisions regarding the intensity of supervision and the type of incentive contract to offer depend importantly on the cost of supervising tenants.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4125.

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Date of creation: 01 Feb 2007
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Handle: RePEc:wbk:wbrwps:4125

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Keywords: Contract Law; Economic Theory&Research; Investment and Investment Climate; Municipal Housing and Land; Urban Housing;

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  1. Dilip Mookherjee & Debraj Ray, 2000. "Contractual Structure and Wealth Accumulation," Boston University - Institute for Economic Development 107, Boston University, Institute for Economic Development.
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  4. Binswanger, Hans P. & Deininger, Klaus & Feder, Gershon, 1995. "Power, distortions, revolt and reform in agricultural land relations," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 42, pages 2659-2772 Elsevier.
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Citations

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Cited by:
  1. Jin, Songqing & Deininger, Klaus W., 2007. "Land Rental Markets in the Process of Rural Structural Transformation: Productivity and Equity Impacts from China," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 9932, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  2. Ghebru, Hosaena H. & Holden, Stein T., 2012. "Reverse Share-Tenancy and Marshallian Inefficiency: Bargaining Power of Landowners and the Sharecroppers’ Productivity," CLTS Working Papers 2/12, Centre for Land Tenure Studies, Norwegian University of Life Sciences.
  3. Mike Waugh & David Lagakos & Doug Gollin, 2011. "The Agricultural Productivity Gap in Developing Countries," 2011 Meeting Papers 1397, Society for Economic Dynamics.
  4. Deininger, Klaus & Ali, Daniel Ayalew & Alemu, Tekie, 2011. "Productivity effects of land rental markets in Ethiopia : Evidence from a matched tenant-landlord sample," Policy Research Working Paper Series 5727, The World Bank.
  5. Deininger, Klaus & Jin, Songqing & Yadav, Vandana, 2012. "Does sharecropping affect productivity and long-term investment ? evidence from West Bengal's tenancy reforms," Policy Research Working Paper Series 6293, The World Bank.
  6. Abdulai, Awudu & Owusu, Victor & Goetz, Renan, 2011. "Land tenure differences and investment in land improvement measures: Theoretical and empirical analyses," Journal of Development Economics, Elsevier, vol. 96(1), pages 66-78, September.
  7. Douglas Gollin & David Lagakos & Michael E. Waugh, 2013. "The Agricultural Productivity Gap," NBER Working Papers 19628, National Bureau of Economic Research, Inc.

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