This paper proposes a simple general equilibrium theory of agrarian production organization to explain the emergence and persistence of latifundia - minifundia type patterns of agrarian production organization such as have prevailed historically in many parts of Latin America. When land ownership is concentrated, the exercise of market power over land can facilitate the exercise of control over labor, as labor supply to landlord estates is affected by peasant access to land. Equilibria may emerge where landlords, behaving as multi-market Cournot oligopolists, inefficiently hoard land to drive up land rentals and corral cheaper labor into their expanding estates. Labor-service tenancy arrangements, similar to those used in practice, emerge as landlords try to price discriminate. These contracts help to restore allocative inefficiency but lead to lower equilibrium peasant wages and welfare. Population growth, differential technical progress on landlord and peasant farms, and other changes in the physical and economic environment are shown to transform equilibrium patterns of agrarian production organization in ways that are consistent with agrarian trajectories observed in late nineteenth century Chile and several other regions and periods. The model also clarifies how agents' incentives to challenge property rights change along with equilibrium agrarian structures (See my more recent closely related paper "On The Causes of Slavery or Serfdom and the Transition to Agrarian Capitalism: Domar Extended.")
|Date of creation:||2002|
|Contact details of provider:|| Postal: 695 Park Avenue, New York, NY 10065|
Web page: http://econ.hunter.cuny.edu/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dilip Mookherjee, 1995. "Informational Rents and Property Rights in Land," Boston University - Institute for Economic Development 55, Boston University, Institute for Economic Development.
- Baland, Jean-Marie & Robinson, James A, 2003. "Land and Power," CEPR Discussion Papers 3800, C.E.P.R. Discussion Papers.
- Eswaran, Mukesh & Kotwal, Ashok, 1986. "Access to Capital and Agrarian Production Organisation," Economic Journal, Royal Economic Society, vol. 96(382), pages 482-498, June.
- Jonathan H. Conning & James A. Robinson, 2001.
"Land Reform and the Political Organization of Agriculture,"
Department of Economics Working Papers
2001-10, Department of Economics, Williams College.
- Conning, Jonathan H & Robinson, James A, 2002. "Land Reform and the Political Organization of Agriculture," CEPR Discussion Papers 3204, C.E.P.R. Discussion Papers.
- Schaffner, Julie Anderson, 1995. "Attached farm labor, limited horizons and servility," Journal of Development Economics, Elsevier, vol. 47(2), pages 241-270, August.
- MICHAEL R. CARTER & Frederic Zimmerman, 1998.
"The Dynamic Cost and Persistence of Asset Inequality in an Agrarian Economy,"
Wisconsin-Madison Agricultural and Applied Economics Staff Papers
416, Wisconsin-Madison Agricultural and Applied Economics Department.
- Carter, Michael R. & Zimmerman, Frederick J., 2000. "The dynamic cost and persistence of asset inequality in an agrarian economy," Journal of Development Economics, Elsevier, vol. 63(2), pages 265-302, December.
- McCulloch, Rachel & Yellen, Janet L., 1980. "Factor market monopsony and the allocation of resources," Journal of International Economics, Elsevier, vol. 10(2), pages 237-247, May.
- Michael Kevane, 1996. "Agrarian Structure and Agricultural Practice: Typology and Application to Western Sudan," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(1), pages 236-245.
- Binswanger, Hans P. & Deininger, Klaus & Feder, Gershon, 1993.
"Power, distortions, revolt, and reform in agricultural land relations,"
Policy Research Working Paper Series
1164, The World Bank.
- 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.
- Feenstra, Robert C., 1980. "Monopsony distortions in an open economy: A theoretical analysis," Journal of International Economics, Elsevier, vol. 10(2), pages 213-235, May.
- Nugent, Jeffrey B & Robinson, James A, 2002. "Are Endowments Fate?," CEPR Discussion Papers 3206, C.E.P.R. Discussion Papers.
- Kenneth L. Sokoloff & Stanley L. Engerman, 2000. "Institutions, Factor Endowments, and Paths of Development in the New World," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 217-232, Summer.
- James R. Markusen & Arthur J. Robson, 1980. "Simple General Equilibrium and Trade with a Monopsonized Sector," Canadian Journal of Economics, Canadian Economics Association, vol. 13(4), pages 668-682, November.
- Hotte, Louis, 2001. "Conflicts over property rights and natural-resource exploitation at the frontier," Journal of Development Economics, Elsevier, vol. 66(1), pages 1-21, October.
- Cornia, Giovanni Andrea, 1985. "Farm size, land yields and the agricultural production function: An analysis for fifteen developing countries," World Development, Elsevier, vol. 13(4), pages 513-534, April.
- Braverman, Avishay & Stiglitz, Joseph E, 1982. "Sharecropping and the Interlinking of Agrarian Markets," American Economic Review, American Economic Association, vol. 72(4), pages 695-715, September.
- Sadoulet, Elisabeth, 1992. "Labor-Service Tenancy Contracts in a Latin American Context," American Economic Review, American Economic Association, vol. 82(4), pages 1031-1042, September.
When requesting a correction, please mention this item's handle: RePEc:htr:hcecon:02/1. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jonathan Conning)
If references are entirely missing, you can add them using this form.