IDEAS home Printed from https://ideas.repec.org/p/ags/asae17/284820.html
   My bibliography  Save this paper

Credit, Tenancy Choice and Agricultural Efficiency: Evidences from the Northern Region of Bangladesh

Author

Listed:
  • Bidisha, Sayema Haque
  • Hossain, Amzad
  • Hasan, Mehedi
  • Alam, Rubaiyat

Abstract

Using both household level and plot level data of Northern Bangladesh, this paper analyzes the difference in agricultural productivity across different contractual arrangements among ultra-poor households. Employing fixed effect model on the Pseudo panel data the paper finds evidence of sub-optimal use of inputs and the consequent lower productivity for lands cultivated under share-cropping contract. The inefficiency on part of the sharecroppers is also evidenced by Stochastic Frontier Model. Although the paper finds no direct impact of credit on productivity, results of Logit estimates suggest that availability of credit induces households to opt for fixed rental contract.

Suggested Citation

  • Bidisha, Sayema Haque & Hossain, Amzad & Hasan, Mehedi & Alam, Rubaiyat, 2017. "Credit, Tenancy Choice and Agricultural Efficiency: Evidences from the Northern Region of Bangladesh," 2017 ASAE 9th International Conference, January 11-13, Bangkok, Thailand 284820, Asian Society of Agricultural Economists (ASAE).
    • Handle: RePEc:ags:asae17:284820
    DOI: 10.22004/ag.econ.284820
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/284820/files/Sayema%20Haque%20Bidisha.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.284820?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Joseph E. Stiglitz, 1974. "Incentives and Risk Sharing in Sharecropping," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 41(2), pages 219-255.
    2. Sadoulet, Elisabeth & Fukui, Seiichi & Janvry, Alan de, 1994. "Efficient share tenancy contracts under risk: The case of two rice-growing villages in Thailand," Journal of Development Economics, Elsevier, vol. 45(2), pages 225-243, December.
    3. Rashid, Shahidur & Sharma, Manohar & Zeller, Manfred, 2002. "Micro-lending for small farmers in Bangladesh," MTID discussion papers 45, International Food Policy Research Institute (IFPRI).
    4. Bidisha, Sayema Haque & Khan, Akib & Imran, Khalid & Khondker, Bazlul H. & Suhrawardy, Gazi Mohammad, 2017. "Role of credit in food security and dietary diversity in Bangladesh," Economic Analysis and Policy, Elsevier, vol. 53(C), pages 33-45.
    5. Quibria, M. G. & Rashid, Salim, 1984. "The puzzle of sharecropping: A survey of theories," World Development, Elsevier, vol. 12(2), pages 103-114, February.
    6. Shaban, Radwan Ali, 1987. "Testing between Competing Models of Sharecropping," Journal of Political Economy, University of Chicago Press, vol. 95(5), pages 893-920, October.
    7. Eswaran, Mukesh & Kotwal, Ashok, 1985. "A Theory of Contractual Structure in Agriculture," American Economic Review, American Economic Association, vol. 75(3), pages 352-367, June.
    8. Foltz, Jeremy D., 2004. "Credit market access and profitability in Tunisian agriculture," Agricultural Economics, Blackwell, vol. 30(3), pages 229-240, May.
    9. Ray, Tridip & Singh, Nirvikar, 2001. "Limited liability, contractual choice, and the tenancy ladder," Journal of Development Economics, Elsevier, vol. 66(1), pages 289-303, October.
    10. Arcand, Jean-Louis & Ai, Chunrong & Ethier, Francois, 2007. "Moral hazard and Marshallian inefficiency: Evidence from Tunisia," Journal of Development Economics, Elsevier, vol. 83(2), pages 411-445, July.
    11. Shetty, Sudhir, 1988. "Limited liability, wealth differences and tenancy contracts in agrarian economies," Journal of Development Economics, Elsevier, vol. 29(1), pages 1-22, July.
    12. Laha, Arindam & Kuri, Pravat Kumar, 2010. "Rural Credit Market and the Choice of Tenurial Contracts: A Micro Evidence from Rural West Bengal, India," Bangladesh Development Studies, Bangladesh Institute of Development Studies (BIDS), vol. 33(4), pages 63-83, December.
    13. Jean-Jacques Laffont & Mohamed Salah Matoussi, 1995. "Moral Hazard, Financial Constraints and Sharecropping in El Oulja," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(3), pages 381-399.
    14. Carter, Michael R., 1989. "The impact of credit on peasant productivity and differentiation in Nicaragua," Journal of Development Economics, Elsevier, vol. 31(1), pages 13-36, July.
    15. Jacoby, Hanan G. & Mansuri, Ghazala, 2009. "Incentives, supervision, and sharecropper productivity," Journal of Development Economics, Elsevier, vol. 88(2), pages 232-241, March.
    16. Goswami , Binoy & Bezbaruah, M. P., 2013. "Do Sharecroppers Undersupply Effort? Evidence from a Farm Level Survey in Assam Plains," Bangladesh Development Studies, Bangladesh Institute of Development Studies (BIDS), vol. 36(2), pages 43-76, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cao, Yueming & Bai, Yunli & Zhang, Linxiu, 2021. "Plot Size, Adjacency, and Farmland Rental Contract Choice," 2021 Conference, August 17-31, 2021, Virtual 315378, International Association of Agricultural Economists.
    2. Khanal, Uttam & Wilson, Clevo & Rahman, Sanzidur & Lee, Boon & Hoang, Vincent, 2020. "Smallholder farmers’ adaptation to climate change and its potential contribution to UN’s sustainable development goals of zero hunger and no poverty," MPRA Paper 106917, University Library of Munich, Germany, revised 07 Sep 2020.
    3. Liu, Yansui & Zou, Lilin & Wang, Yongsheng, 2020. "Spatial-temporal characteristics and influencing factors of agricultural eco-efficiency in China in recent 40 years," Land Use Policy, Elsevier, vol. 97(C).
    4. Yueming Cao & Yunli Bai & Linxiu Zhang, 2022. "Plot Size, Adjacency, and Farmland Rental Contract Choice," Land, MDPI, vol. 11(4), pages 1-21, April.
    5. İbrahim Bozkurt & M. Veysel Kaya, 2021. "Agricultural production index: International comparison," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 67(6), pages 236-245.
    6. Le Phuong Xuan Dang & Viet-Ngu Hoang & Son Hong Nghiem & Clevo Wilson, 2023. "Social capital and informal credit access: empirical evidence from a Vietnamese household panel survey," Empirical Economics, Springer, vol. 65(1), pages 311-340, July.
    7. Nasim, Sanval & Helfand, Steven & Dinar, Ariel, 2020. "Groundwater management under heterogeneous land tenure arrangements," Resource and Energy Economics, Elsevier, vol. 62(C).
    8. Kassouri, Yacouba & Kacou, Kacou Yves Thierry, 2022. "Does the structure of credit markets affect agricultural development in West African countries?," Economic Analysis and Policy, Elsevier, vol. 73(C), pages 588-601.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Konrad B Burchardi & Selim Gulesci & Benedetta Lerva & Munshi Sulaiman, 2019. "Moral Hazard: Experimental Evidence from Tenancy Contracts," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 134(1), pages 281-347.
    2. Benin, Samuel & Place, Frank & Nkonya, Ephraim M. & Pender, John L., 2006. "Land Markets and Agricultural Land Use Efficiency and Sustainability: Evidence from East Africa," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25645, International Association of Agricultural Economists.
    3. Yutaka ARIMOTO & Tetsuji OKAZAKI & Masaki NAKABAYASHI, 2010. "Agrarian Land Tenancy In Prewar Japan: Contract Choice And Implications On Productivity," The Developing Economies, Institute of Developing Economies, vol. 48(3), pages 293-318, September.
    4. Ananish Chaudhuri & Pushkar Maitra, 1997. "Determinants of Land Tenure Contracts; Theory and Evidence from Rural India," Departmental Working Papers 199710, Rutgers University, Department of Economics.
    5. Jacoby, Hanan G. & Mansuri, Ghazala, 2009. "Incentives, supervision, and sharecropper productivity," Journal of Development Economics, Elsevier, vol. 88(2), pages 232-241, March.
    6. Sen, Debapriya, 2011. "A theory of sharecropping: The role of price behavior and imperfect competition," Journal of Economic Behavior & Organization, Elsevier, vol. 80(1), pages 181-199.
    7. Ananish Chaudhuri, 1997. "A Dynamic Model of Contractual Choice in Tenancy," Departmental Working Papers 199711, Rutgers University, Department of Economics.
    8. Oriana Bandiera, 1999. "On the Structure of Tenancy contracts: Theory and Evidence fron 19th Century Rural Sicily," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 19, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    9. Zenou, Yves & Jellal, Mohamed, 2005. "Ethnic Diversity, Market Structure and Risk Sharing in Developing Countries," CEPR Discussion Papers 5366, C.E.P.R. Discussion Papers.
    10. Debapriya Sen, 2005. "Sharecropping, interlinkage, and price variation," Department of Economics Working Papers 05-10, Stony Brook University, Department of Economics.
    11. Pietrobon, Davide, 2024. "The dual role of insurance in input use: Mitigating risk versus curtailing incentives," Journal of Development Economics, Elsevier, vol. 166(C).
    12. Oriana Bandiera, 2002. "Land Distribution, Incentives and the Choice of Production Techniques in Nicaragua," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 34, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    13. Priyanka Pandey, 2004. "Effects of Technology on Incentive Design of Share Contracts," American Economic Review, American Economic Association, vol. 94(4), pages 1152-1168, September.
    14. Dubois, Pierre, 2002. "Moral hazard, land fertility and sharecropping in a rural area of the Philippines," Journal of Development Economics, Elsevier, vol. 68(1), pages 35-64, June.
    15. Nasim, Sanval & Helfand, Steven & Dinar, Ariel, 2020. "Groundwater management under heterogeneous land tenure arrangements," Resource and Energy Economics, Elsevier, vol. 62(C).
    16. Raul V. Fabella, 2016. "Why Fixed Rent Contracts are Less Prevalent: Weak Third Party Enforcement and Endogenous Principal Type," UP School of Economics Discussion Papers 201606, University of the Philippines School of Economics.
    17. Yutaka Arimoto & Tetsuji Okazaki & Masaki Nakabayashi, 2005. "Risk, Transaction Costs, and Geographic Distribution of Share Tenancy: A Case of Pre-War Japan," CARF F-Series CARF-F-024, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    18. Nozilakhon Mukhamedova & Richard Pomfret, 2019. "Why Does Sharecropping Survive? Agrarian Institutions and Contract Choice in Kazakhstan and Uzbekistan," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(4), pages 576-597, December.
    19. Narayan Das & Alain de Janvry & Elisabeth Sadoulet, 2019. "Credit and Land Contracting: A Test of the Theory of Sharecropping," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 101(4), pages 1098-1114.

    More about this item

    Keywords

    Agricultural Finance;

    JEL classification:

    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:asae17:284820. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/asaeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.