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Ethnic divisions, contract choice, and search costs in the Guatemalan land rental market

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  • Macours, Karen

Abstract

This paper shows how ethnic diversity in a context of weak property rights enforcement can result in market segmentation. The paper analyzes how contract enforcement problems affect the joint decision of partner and contract choice by landlords in the land rental market in Guatemala. The empirical method allows partner choice to be determined not only by the characteristics and relative scarcity of the specific landowner and tenant, but also by the characteristics of other potential tenants. The results show that landowners without formal title are more likely to restrict their partners to tenants from the same ethnic group. Partner choice is found to be less important for renting with interlinked land–labor contracts.

Suggested Citation

  • Macours, Karen, 2014. "Ethnic divisions, contract choice, and search costs in the Guatemalan land rental market," Journal of Comparative Economics, Elsevier, vol. 42(1), pages 1-18.
  • Handle: RePEc:eee:jcecon:v:42:y:2014:i:1:p:1-18
    DOI: 10.1016/j.jce.2013.08.003
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    Cited by:

    1. Ghebru, Hosaena H. & Holden, Stein T., 2012. "Reverse-Share-Tenancy and Marshallian Inefficiency: Bargaining Power of Landowners and the Sharecropper’s Productivity," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126883, International Association of Agricultural Economists.
    2. Alberto Alesina & Eliana La Ferrara, 2003. "Ethnic Diversity and Economic Performance," Harvard Institute of Economic Research Working Papers 2028, Harvard - Institute of Economic Research.
    3. Dominic Rohner & Mathias Thoenig & Fabrizio Zilibotti, 2013. "Seeds of distrust: conflict in Uganda," Journal of Economic Growth, Springer, vol. 18(3), pages 217-252, September.
    4. repec:ags:frraes:276808 is not listed on IDEAS
    5. Jérémie GIGNOUX & Karen MACOURS & Liam WREN-LEWIS, 2015. "Impact of land administration programs on agricultural productivity and rural development: existing evidence, challenges and new approaches," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 96(3), pages 467-498.
    6. Ma, X. & Zhou, Y. & Heerink, N. & Shi, X. & Liu, H., 2018. "Tenure security, social relations and contract choice: Endogenous matching in the Chinese land rental market," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277478, International Association of Agricultural Economists.
    7. Carla Canelas & Rachel M. Gisselquist, 2017. "Human capital, labour market outcomes, and horizontal inequality in Guatemala," WIDER Working Paper Series 091, World Institute for Development Economic Research (UNU-WIDER).
    8. repec:cup:jinsec:v:13:y:2017:i:03:p:673-697_00 is not listed on IDEAS
    9. Deininger, Klaus & Jin, Songqing, 2007. "Land rental markets in the process of rural structural transformation : productivity and equity impacts in China," Policy Research Working Paper Series 4454, The World Bank.
    10. Yahui Wang & Liangjie Xin & Xiubin Li & Jianzhong Yan, 2016. "Impact of Land Use Rights Transfer on Household Labor Productivity: A Study Applying Propensity Score Matching in Chongqing, China," Sustainability, MDPI, Open Access Journal, vol. 9(1), pages 1-18, December.
    11. Matthew Collin, 2013. "Tribe or title? Ethnic enclaves and the demand for formal land tenure in a Tanzanian slum," CSAE Working Paper Series 2013-12, Centre for the Study of African Economies, University of Oxford.
    12. Hagos, Hosaena Gebru & Holden, Stein T., 2013. "Reverse-share-tenancy and Marshallian Inefficiency: Landowners’ bargaining power and sharecroppers’ productivity," IFPRI discussion papers 1270, International Food Policy Research Institute (IFPRI).
    13. Jérémie GIGNOUX & Karen MACOURS & Liam WREN-LEWIS, 2015. "Impact of land administration programs on agricultural productivity and rural development: existing evidence, challenges and new approaches," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 96(3), pages 467-498.
    14. Jain, Tarun & Sood, Ashima, 2017. "How does relationship-based governance accommodate new entrants? Evidence from the cycle-rickshaw rental market," Journal of Institutional Economics, Cambridge University Press, vol. 13(03), pages 673-697, September.
    15. Carla Canelas & Rachel Gisselquist, 2017. "Human Capital, Labor Market Outcomes and Horizontal Inequality in Guatemala," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01658795, HAL.
    16. Carla Canelas & Rachel Gisselquist, 2017. "Human Capital, Labour Market Outcomes and Horizontal Inequality in Guatemala," Documents de travail du Centre d'Economie de la Sorbonne 17045, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    17. Ricker-Gilbert, Jacob & Lunduka, Rodney W. & Kanyamuka, Joseph Samuel & Jumbe, Charles & Kaiyatsa, Stevier & Chamberlin, Jordan, 2017. "Do Farm Land Rental Markets Really Promote Efficiency, Equity and Investment in Smallholder African Agriculture? Evidence from a Matched Tenant-Landlord Survey in Malawi," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258391, Agricultural and Applied Economics Association.
    18. repec:eee:wdevel:v:99:y:2017:i:c:p:377-394 is not listed on IDEAS

    More about this item

    Keywords

    Ethnic diversity; Land markets; Contract choice; Property rights;

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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