Land Distribution, Incentives and the Choice of Production Techniques in Nicaragua

Oriana Bandiera

STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers from Suntory and Toyota International Centres for Economics and Related Disciplines, LSE

Abstract: Does the distribution of land rights affect the choice of contractible techniques? I present evidence suggesting that Nicaraguan farmers are more likely to grow effort-intensive crops on owned rather than on rented plots. I consider two theoretical arguments that illustrate why property rights might matter. In the first the farmer is subject to limited liability; in the second the owner cannot commit to output-contingent contracts. In both cases choices might be inefficient regardless of land distribution. The efficiency loss, however, is lower when the farmer owns the land. Further evidence suggests that, in this context, the inefficiency derives from lack of commitment.

Keywords: Agricultural productivity; asymmetric information; crop choice. (search for similar items in EconPapers)
Date: 2002-04
New Economics Papers: this item is included in nep-agr and nep-dev
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Land Distribution, Incentives and the Choice of Production Techniques in Nicaragua (2002)
Working Paper: Land distribution, incentives and the choice of production techniques in Nicaragua (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:cep:stidep:34

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