An Asset Risk Theory of Share Tenancy

Marc Bellemare and Christopher Barrett

No 127203, Working Papers from Cornell University, Department of Applied Economics and Management

Abstract: Reverse share tenancy, wherein poorer landlords rent out land to richer tenants on shares, is a common phenomenon. Yet it does not fit existing theoretical models of sharecropping and has never before been modeled in the economics literature. We explain share tenancy contracts using an asset risk model that incorporates Marshallian inefficiency and thereby provides a credible explanation for share tenancy more broadly, reverse tenancy included. When choosing the terms of an agrarian contract, the landlord considers the impact of her choice on the probability that she will retain future rights to the rented land. Thus, this model captures the effect of tenure insecurity and property rights on agrarian contracts. Among the main testable implications of the theoretical model are that, as property rights become more secure, reverse tenancy tends to disappear and that kin contracts tend to make share tenancy more likely.

Keywords: Risk; and; Uncertainty (search for similar items in EconPapers)
Pages: 21
Date: 2003-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://ageconsearch.umn.edu/record/127203/files/Cornell_Dyson_wp0313.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:cudawp:127203

DOI: 10.22004/ag.econ.127203

Access Statistics for this paper

More papers in Working Papers from Cornell University, Department of Applied Economics and Management Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().