Variation in Output Shares and Endogenous Matching in Land Rental Contracts: Evidence from Ethiopia

We investigate the extent of variation in output sharing in land rental contracts and alternative hypotheses to explain this variation. Close to half of the rental contracts in our study in northern Ethiopia have output shares that deviate from the dominant 50–50 equal sharing. Variation in land quality, the relative bargaining power of landlords and tenants, production risks and shocks are hypothesised to influence output shares. Matched data of landlords and tenants are used. The importance of endogenous matching of landlords and tenants is investigated by assessing how endogenous tenant characteristics are correlated with landlord characteristics. We find evidence of negative assortative matching for key resource characteristics. A control function approach is used to control for endogenous matching in the output share models. The results reveal that production risks, as well as relative bargaining power, affect output shares in the reverse tenancy setting where tenants are relatively wealthier and more influential than landlords.     

Tenants, Landlords, and Soil Conservation

It has long been argued that tenants tend to overexploit land, but this conventional wisdom has been derived largely without consideration of landlords' actions. We examine what happens when landlords can invest in durable conservation measures in addition to choosing rental contract terms. When tenants are risk neutral, landlords overinvest in conservation under cash rental contracts but can achieve first best levels of output and protection against land degradation when conservation investment is combined with share rental. When tenants are risk averse, the first best is unattainable. In this case, conservation investment combined with share rental results in output levels below the first best, while equilibrium conservation investment may be greater or less than the first best. These results suggest that contract form and conservation investments are likely made simultaneously, so that econometric studies of conservation practice adoption that treat rental status as exogenous are likely subject to bias.     

How do informal farmland rental markets affect smallholders’ well‐being? Evidence from a matched tenant–landlord survey in Malawi

We estimate the efficiency and equity returns to farmland rental markets in Malawi using a matched tenant–landlord survey of smallholder farm households in four districts. Our sample allows us to more fully observe the landlord side of the rental market, which is almost always missing in previous studies. Our results suggest that land rental markets promote efficiency by facilitating a net transfer of land to more productive farmers. We also find that land rental markets promote equity as conventionally defined in the land markets literature, that is, by transferring land from land‐rich households to land‐poor households, and from labor‐poor to labor‐rich households. However, our study identifies some important challenges for land rental markets in this context. First, we find that tenants in our sample are wealthier than their landlord counterpart on average in all dimensions other than landholding. In addition, most landlords report the motive for renting out their land as either the need for immediate cash, or the lack of labor and/or capital to cultivate the plot that was rented out. These findings align with concerns about potential “stress renting” by poor landlords and suggest the value of defining equity along a broader set of dimensions other than simply equalizing the distribution of farmland and labor.     

近代安徽农村问题及其成因之考察

近代安徽是一个农业大省,但农村社会时常处于危机之中。表现为农民生活急剧恶化,农村人口流离逃亡;农业劳动生产率严重下降,生产停滞不前;土地兼并加重,租佃关系日益扩大和膨胀;民变四起,社会动荡不安。造成此种局面的主要原因在于封建剥削苛酷,战乱频仍,匪祸横行,自然灾害严重等。种种因素的综合作用,使农村社会危机进一步加深。     

Illegibly legible: Outcomes of a land records modernisation programme in South India

This article analyses an initiative in 2017 to update and digitise textual land records in Telangana, a south Indian state. Its premise is that experiments to modernise land records have not met with pre-determined standards of success due, primarily, to the historically evolved contradictions around land as a resource and a commodity. In countries like India, the colonial policies on land and the post-colonial success of landlords to manipulate land records had already left the post-War task of ensuring conclusive land titles intractable. In more recent times, however, the agenda of land records modernisation has been absorbed by neoliberalism, which aims to create free land markets and replace traditional subsidies with direct cash transfers. This article shows that, consequently, the task of land records modernisation in Telangana became disembedded from agendas of agrarian egalitarianism and was rendered more complex—historical errors and exclusions were reproduced in new ways; technocratic solutions of the bureaucracy made governmental processes opaque; landed sections continued to subvert implementation; tenants were excluded from the land titles; and there were fears that the scheme would be misused to ease corporate land acquisition. Land records modernisation remains important for agrarian reform, but its success remains contingent on a greater appreciation among policymakers for the historical and political economy aspects of land ownership and possession.     

An analysis of population growth,Green Revolution and terms of trade in the presence of cropsharing in agriculture

This explores the welfare effects of some persistent trends in some developing countries on different groups of farmers. It takes a general equilibrium approach in modelling a representative developing economy comprising a manufacturing sector and an agricultural sector where both self-cultivating landlords and tenants carry on production. It is shown that while population growth tends to depress welfare of both the tenant and the landlord, Green Revolution has the opposite effect such that when both trends are present, peasants may or may not be better off. An adverse movement in the agricultural terms of trade reduces welfare of the landlord, but the tenant is made better off.     

The Role of Risk and Transaction Costs in Contract Design: Evidence from Farmland Lease Contracts in U.S. Agriculture

The objective of this article is to provide new empirical evidence on landlord-tenant choices of share versus cash-rent contracts in U.S. agriculture. The focus is on the contribution of explanatory variables that represent transaction costs, risk-sharing incentives, or both. An empirical model of contract choice is tested against the 1999 Agricultural Economics and Land Ownership Survey (AELOS) and finds mixed evidence for low transaction cost and risk-sharing-incentive motives for landlord-tenant choices of a share versus cash-rent contract. However, the behavior of landlords and tenants is consistent with them being risk averse. Although it is standard to control for the riskiness of the principal's task that is contracted, we find that other attributes of the landlord are an important part of a relatively complex story for U.S. land tenancy contacting. The latter results have generally been ignored in other published landlord-tenant contracting studies.     

LABOUR MARKET DUALISM,THREAT OF EVICTION AND CROPSHARE TENANCY

Landlords in some countries commonly adopt a policy of short-term leasing such that their tenants perpetually face a threat of termination of the contracts if their performance is not satisfactory. By explicitly modelling the threat of termination in a multi-period framework, this paper demonstrates that: (a) a landlord may prefer a landed rather than a landless tenant, (b) although tenants are free to choose the amount of land for cropsharing, the marginal product of land is not driven down to zero, and (c) the efficiency of cropshare cultivation may not be ranked unambiguously against owner or wage cultivation.     

20世纪中期关中地区的土地问题 --以高陵县通远乡为例

本文通过对土地改革前后高陵县通远乡的土地状况的个案分析，论证了正是因为关中地区人地关系的宽松，租佃关系不普遍，地主和富农拥有的土地不多，结果在土地改革期间，关中地区可供分配的土地比较少，当地政府无法同时做到既完全贯彻中央精神，又充分考虑到地方实际情况，最终在实际执行中，导致了中央政令与地方具体实践在一定程度上的背离；而就产中地区的土地改革本身而言，其效果是不经济的。     

The 1996 FAIR Act: Measuring the Impacts on Land Leasing

Using a 1997 survey of Arkansas farm operators, Federal Agricultural Improvement and Reform (FAIR) Act impacts on changes in cropping mixes on leased land, operator attitudes concerning the sharing of FAIR Act benefits with landlords, and changes in leasing arrangements due to the FAIR Act are investigated. Operators indicated that the FAIR Act caused cropping-mix changes on 24% of surveyed leases. Although some operators believe that landlords disproportionately benefit from the FAIR Act, about three-quarters feel that there was no change or had no opinion. Similarly, we find little evidence that leasing arrangements changed as a result of the FAIR Act.     

A REASSESSMENT OF THE ROLE OF COUNTY COUNCIL SMALLHOLDINGS

County Council smallholding estates were established early this century, reaching a peak in terms of numbers of tenants and area of land at about the time of the Second World War. Since then there has been a gradual reduction in their area and a rapid decline in the numbers of tenants. Debate about their role is concentrated on the inevitable conflict embodied in a policy which operates to resist market forces and yet which expects smallholders to achieve an adequate income within a market context. The declining numbers of tenants and the escalating land costs of providing smallholdings, especially where further output price reductions are anticipated, reemphasises the need to examine the position and prospects for smallholdings. A potential future role is outlined in relation to the wider issues of rural land use.     

Tenants’ land access in the rental market: evidence from northern Ethiopia

The purpose of this study is to investigate the allocation efficiency in the tenancy market, and thereby the potential of the market to facilitate operational farm size adjustment that can help land‐poor tenant households to transform into smallholder commercial farms. We analyzed three rounds of balanced panel data for the production seasons 2005–2006, 2009–2010, and 2014–2015 collected from 320 smallholder farms in Tigrai region in northern Ethiopia. Random effects dynamic probit and tobit models are used to assess how land‐poor tenants’ access and extent of access to land are affected by state dependency (earlier participation in the market), kinship ties, climate shocks, and legal restrictions. The results indicate that state dependency and kinship ties with the landholder had strong positive effects on participation and intensity of participation. Climate shocks significantly affected the intensity of participation of tenants already in the rental market. Tenants’ overall access to rented land had not improved from 2005–2006 to 2014–2015. The amount of land accessed by those already in the market was insufficient for them to become commercial farmers. The important policy implication is that orchestrated interventions at community level are needed to reduce transaction costs and thereby improve land access of entrepreneurial tenants.     

Land tenure systems and agricultural innovation: The case of alley farming in Nigeria

Alley farming is an agroforestry technology which requires access to land and the rights to plant, own and utilize trees. This paper considers the implications of land tenure systems in south-west and south-east Nigeria for the acceptability and viability of alley farming. Considerable variation in the rules governing the use and control of land is seen to exist within and between the two regions, and any one tenure system may include a number of categories of land to which different patterns of use and tenure apply. Broadly speaking, tenants in parts of south-west Nigeria may be disadvantaged as their rights over hired land do not necessarily include the right to plant trees. In the south-east, the existence of communal systems of landownership and management on some categories of land undermines the ability to plant trees and the incentive to invest labour in the maintenance of soil fertility.     

晋绥边区的土地关系与社会结构的变动 --20世纪三四十年代乡村社会变动的个案分析

20世纪三、四十年代，晋绥边区还保持着封建地主经济的原貌。中共晋绥边区民主政权对于地权关系的调整、改革，就在这一历史场境中展开。以减租减息为主的调整农村土地关系的政策，是在保障佃权和改善农民生活前提下实施的，虽未触及地主土地所有制，但它也带来了深刻的社会变革。1946年5月，晋缓边区开展土改运动。田家会村和吕梁四区土改个案表明，土改所导致的乡村社会变革既是剧烈的也是深刻的，由此形成的乡村社会阶级和权力关系的结构性变动，将持久而深远地影响着中国农村社会发展的路向。“新富农”是土改后乡村中出现的新阶层，由此产生的“不平均化”和两极分化，将是共产党政权必须面对必须做出历史回答的新问题。     

Fragmentation of land ownership in Slovakia: Evolution,context, analysis and possible solutions

Land ownership fragmentation is currently a very topical issue in Slovakia. In particular, small farmers complain that even 30 years after the end of the previous (“real socialist”) regime, there has been no significant change in the structure of agricultural land use. The subject of the article is not the land fragmentation in terms of use. In Slovakia, the problem is rather the opposite. This contribution deals with fragmentation of ownership that is mostly invisible in the landscape. Usage still dominates over the ownership and the real landowner cannot get his or her own property in a simple way. The reason for this is huge fragmentation of land ownership, which makes it virtually impossible to actually claim it. Well known solution is the land consolidation that does not advance at a rate that would guarantee the rights (and obligations) of all owners in the foreseeable future in Slovakia. Neglecting the land fragmentation by authorities leads to tense situations between landowners and land tenants and also co-causes a stagnation of rural development and issues with landscape protection. The paper describes the specific state of land ownership in Slovakia and attempts to explain this complicated situation on a sample of 50 historical and modern ownership documents. This contribution has the ambition to specify the largely yet unresolved problems that arise from the current state of massive fragmentation of land ownership. The aim of the paper is also to fill in the information gap on the topic, not only in the national context.     

Does land lease tenure insecurity cause decreased productivity and investment in the sugar industry? Evidence from Fiji

Does land lease tenure insecurity cause decreased productivity and investment in the sugar industry? To answer this question, this study examined the impact of weak formal tenure lease arrangements on tenants’ investment and the productivity of sugarcane in Ba province, Fiji. After controlling for potential endogeneity in the choice of lease tenure using instrumental variables (IV), it was shown that tenants under insecure lease tenure (expiring in 0–5 years) achieve significantly lower yields of sugarcane, by 6.5–11 tonnes per hectare, and plant smaller areas of new sugarcane, by 0.14–0.25 hectares on average, than do tenants under secure lease tenure. Insecure lease tenure also negatively affects chemical fertiliser use, although this impact is not statistically significant. An intervention to improve tenure security would likely enhance the production efficiency of and investment in the Fijian sugarcane industry.     

Institutions for improving access to land for settler-housing: Evidence from Papua New Guinea

This paper provides household level evidence of the institutions that are developing to provide security of access to land for housing within the settlements of Port Moresby, the capital of Papua New Guinea. Data collected from a survey of 441 randomly selected households shows that households organise around regional, family, and professional cleavages to provide security to person and property. Further, some households pay rent to landlords and keep evidence of the above to legitimise their claims to the land settled upon. In one case, a community has formed an organisation to mediate between the settlers and the customary landowning group. The above is evidence of the maturation of institutions to provide tenure security. It also provides the opportunity for policymakers to adopt and then adapt (migrate) the existing institutions into the formal system as part of ongoing reforms.     

Rental markets for cultivated land and agricultural investments in China

The purpose of this paper is to empirically track the progress and consequences of the emergence of cultivated land markets in China since 2000. We draw on a set of nationwide, household‐level panel data (for 2000 and 2008) and find that the markets for cultivated land rental have emerged robustly. According to our data, 19 of China's cultivated land was rented in farm operators in 2008. We also find that the nature of China's cultivated land rental contracts has become more formal and lengthened the period of time that the tenant is able to cultivate the rented‐in plots. While there may be benefits for lessors and tenants, our data show that there are falling rates of investment in organic manure. The farmers in our sample have reduced organic manure use from 13 tons/ha in 2000 to 5 tons/ha in 2008. Part of this fall is due to the rise of cultivated land rental markets. The analysis, however, does not find that improved property rights in cultivated land rental affect investment largely because property rights have largely been established by 2000, the first year of our sample. Our results, however, also show that there are forces that appear to be mitigating the negative consequences of rising cultivated land rental. After holding constant initial rental rates and other factors, we find that the gap between investment in organic manure in own land and rented‐in land is narrowing. One interpretation of our findings is that if policymakers can find ways to even further strengthen the rights of lessors and tenants as well as lengthen contract periods, farmers—even those that rent—will invest more in their land, because they will be able to capture the returns to their investments.     

Agrarian class struggle and state formation in post‐colonial Pakistan, 1959–1974: Contingencies of Mazdoor Kisan Raj

State formation in post‐colonial societies is often explained with reference to the roles of elites. In Pakistan, landed elites continue to dominate the rural political economy through informal and formal institutions, but the history of its largest peasant movement shows how agrarian class struggle can change the institutional forms and functions of power. The Hashtnagar peasant movement achieved lasting de facto land and tenancy reforms in north‐western Pakistan in the 1970s through forcible land occupations that were regularized by state intervention. I argue that although divisions among elites were important, the state intervened in favour of peasants due to the rising organizational power of tenants and landless labourers under the centralized leadership of the radical Mazdoor Kisan Party. Agrarian class struggle weakened the informal power of landed elites and gave rise to institutions of peasant power. However, other fractions of the ruling class sought to undermine their landed opponents while co‐opting the militancy of the peasant movement by strengthening state institutions to intervene in favour of upwardly mobile tenants. The latter were separated from poorer peasants and the landless, thus demobilizing the movement.     

Landlords and farmers: implications of disparities in bargaining power for tenancy in agriculture

The equilibrium allocation of owner operated and rental land in the agricultural sector is examined given risk averse agents, risky returns and asset price risk. The model is extended to account for disparities in bargaining power among landlords and farmers. In the absence of disparities, the competitive equilibrium allocation satisfies the general conditions for optimal risk sharing with an adjustment factor similar to the optimal hedge ratio. Differences in bargaining power result in deviations from the optimal risk sharing conditions. Numerical simulations of tenancy structure are conducted for a developed agricultural economy exposed to various forms of risk. Estimates of parameter values representing the riskiness of returns and asset prices in this study are based on vector auto regressive techniques. The simulations show that a substantial reduction of the rental ratio is obtained in a situation where farmers are equally or more risk averse than landlords. Consequently, the results indicate that the importance of the tenancy institution as a risk sharing mechanism is severely mitigated in the presence of asset price risk, risky returns, relatively risk averse farmers and disparities in bargaining power.