Risk Sharing and Incentives in the Decollectivization of Agriculture
In many countries, collective agrarian reform agriculture has decollectivized through th e subdivision, or parcellation, of large-scale farms into multiple sm all holdings. While parcellation can provide an escape from a low-eff ort-low-income equilibrium in the collective, it exposes individuals to empirically-significant risk. Analysis of institutional choice in agriculture shows that parcellation is a suboptimal resolution of the incentive-risk-sharing tradeoff. As an alternative, the paper propos es partial decollectivization which combines incentives and risk shar ing in a way consistent with static productivity and long-term agrari an reform goals. Copyright 1987 by Royal Economic Society.
Volume (Year): 39 (1987)
Issue (Month): 3 (September)
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