Technology and labor contract: Two systems of rice harvesting in the Philippines

Major changes in agrarian institutions in the Philippines, such as landtenure and labor-contract arrangements, are analyzed in terms of theories of contractual choice and social interactions. The results are consistent with the hypothesis that introduction of a certain technology (e.g., machine threshing of rice) reduces transaction costs involved in specific contractual arrangements (e.g., sharecropping), thereby making specific forms of economic organization (e.g., the rice hacienda) viable. Land reform (and also the green revolution) in the rice-growing areas of the Philippines again causes a change in harvesting technology. Through complex social interaction this gives rise to changes in labor contracts.