Does Sharecropping Affect Long-term Investment? Evidence from West Bengal’s Tenancy Reforms

Klaus Deininger, Songqing Jin and Vandana Yadav
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Vandana Yadav: Michigan State University

Chapter 3 in Land Tenure Reform in Asia and Africa, 2013, pp 54-79 from Palgrave Macmillan

Abstract: Abstract In India, land reform has been high on the political agenda since independence in 1947, and early efforts at abolishing intermediaries are widely credited with having brought about significant social benefits. The most prominent type is tenancy reform. As it does not extinguish landlords’ ownership rights, tenants — who may have benefited from rent ceilings and cannot be evicted — still have to pay annual share rent. This weakness of rights may fail to create the incentives for effort supply and long-term investment that have underpinned the success of land reforms elsewhere, effectively adding a dynamic inefficiency to the disincentives created by the Marshallian inefficiency of sharecropping. This could imply that despite the high political price of implementing land reform in India, the schemes so far have failed to reach their productivity and poverty reduction potential.

Keywords: Land Reform; Linear Probability Model; Family Labor; Investment Incentive; Political Weekly (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1057/9781137343819_3

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