Inefficiency due to tenancy protection: a new tenure problem in Taiwan

Chung‐Huang Huang

Agricultural Economics, 1991, vol. 5, issue 2, 121-133

Abstract: Fixed‐rent tenancy was traditionally regarded as equally efficient as owner‐cultivators. The counter‐example is, however, presented here. Specifically, tenants with fixed‐rent contracts and well protected by tenancy regulations may, in the long run, turn out to be less efficient than other farmers (e.g., owner‐cultivators and informal tenants), particularly when they do not heavily depend on farm revenue as major source of family income. On the other hand, tenants who are not benefited from tenancy regulations might not be less efficient than owner‐cultivators. The underlying implication is tenancy reform is not a panacea for improving farming efficiency; it may result in many negative effects in the long run.

Date: 1991
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