the dynamic cost and persistence of asset inequality in an agrarian economy abstract a growing literature suggests that asset inequality can be economically costly in the presence of agency costs that constrain labor and capital markets unclear in this literature is whether asset markets and optimal individual accumulation of self finance capacity suffice to eliminate costly inequality over time this paper uses numerical dynamic programming methods to explore this question with a model of an initially inegalitarian agrarian economy while an egalitarian asset distribution emerges over time the process involves sufficiently great productivity losses along the way that a redistributive policy could improve on the market s performance by both equity and efficiency criteria

assessing the functioning of land rental markets in ethiopia although a large theoretical literature discusses the possible inefficiency of sharecropping contracts the empirical evidence on this phenomenon has been ambiguous at best household level fixed effect estimates from about 8 500 plots operated by households that own and sharecrop land in the ethiopian highlands provide support for the hypothesis of marshallian inefficiency at the same time a factor adjustment model suggests that the extent to which rental markets allow households to attain their desired operational holding size is extremely limited our analysis points towards factor market imperfections no rental for oxen lack of alternative employment opportunities and tenure insecurity as possible reasons underlying such behavior suggesting that rather than worrying almost exclusively about marshallian inefficiency it is equally warranted to give due attention to the policy framework within which land rental markets operate

fertility and rural labor market inefficiencies evidence from india abstract informational frictions are an important source of inefficiency in rural labor markets i examine the role of family size in mitigating costs that arise due to these frictions i show that an increase in family size decreases the demand for hired labor in tasks for which worker output and effort are difficult to observe monitoring intensive tasks in contrast in tasks for which worker output is easily observed i find no relationship between family size and hired labor use i provide evidence that supervision costs drive the preference for family labor in monitoring intensive tasks as a consequence larger families spend less time in supervision i develop a theoretical framework that illustrates the empirical challenge of identifying the link between family size and labor demand factors that determine labor demand on the farm also determine family size to address this endogeneity problem i use exogenous variation in fertility induced by both a family planning policy in india which provides cash incentives for sterilization take up and income shocks i show that while neither incentive payments nor income shocks by themselves are valid instruments for completed fertility their interaction is a valid instrument i infer that population control policies must take into account market inefficiencies that make larger families profitable

cournot oligopoly reconsidering cournot the cournot equilibrium is consistent this article uses an infinite regress model of firm level decisions to find a rational expectations equilibrium for a duopoly and to relate concepts of conjectural variations and consistency to the cournot equilibrium the model derives a conjectural variation instead of assuming it in particular the cournot equilibrium is shown to be consistent in the usual sense of the literature the conflict between notions of consistent conjectures and the cournot equilibrium results from a compounding problem inherent in the earlier models we extend these results to the n firm problem alternatively the article can be viewed as providing a purely static model that generates the cournot equilibrium without reference to conjectures or quasi dynamics

nutrition and labor producvivity in agriculture estimates for rural south india using panel data for rural south india a fixed effects individual wage equation and farm production function are estimated that have calorie intake and nutritional status weight for height of workers as their arguments neither market wages nor farm output are observed to be responsive to changes in the daily energy intake of workers however both are highly elastic with respect to weight for height these results suggest that while the human body can adapt to inadequate nutrition in the short run it cannot adapt as readily to chronic malnutrition that eventually results in loss of weight for height copyright 1988 by mit press

a real option based model for promoting sustainable energy projects under the clean development mechanism abstract the clean development mechanism cdm provides a way of assisting sustainable development in developing countries for developed countries to reduce greenhouse gas ghg emissions despite its intended benefits the primary cdm market decreased from us 5 8 billion in 2006 to us 1 5 billion in 2010 one of the primary reasons for the reduction of market size is that developed countries as investors have a high level of risks caused by the volatility of the market price for certified emission reductions cers another issue to be resolved is that developing countries as host countries cannot claim any right to the cers produced on their own land this paper presents a real option based model for both parties developed and developing countries to have their fair share of profits and risks by controlling the uncertainty associated with the future value of cers a case study illustrated that the proposed model can effectively attract investors to cdm projects leading to mitigation of climate change

incentives and moral hazard plot level productivity of factory operated and outgrower operated sugarcane production in ethiopia we investigate the unique contractual arrangement between a large ethiopian sugar factory and its adjacent outgrower associations the only significant difference between the sugarcane production on the factory operated sugarcane plantation and on the outgrower operated plots is the remuneration system and thus the incentives to the workers we compare the productivity of the factory operated plantation with the outgrower operated plots based on a new cross sectional plot level data set that includes all plots that are operated by the sugar factory and its adjacent outgrower associations as sugar cane production depends on various exogenous factors that are measured as categorical variables e g soil type cane variety etc we estimate the production function by a nonparametric kernel regression method that takes into account both continuous and categorical explanatory variables without assuming a functional form and without imposing restrictions on interactions between the explanatory variables in order to obtain meaningful productivity measures we impose monotonicity in input quantities using the constrained weighted bootstrapping cwb method our results show that outgrower operated plots have ceteris paribus a statistically and economically significantly higher productivity than factory operated plots which can be explained by outgrowers having stronger incentives to put more effort into their work than the employees of the sugar factory

subsidy or market reform rethinking china s farm consolidation strategy chinese food security policy is anchored increasingly on the conviction that domestic grain production should be greatly enhanced and the best way to do so is to expand farm production scale to that end an increasing stream of public investment has been directed to the grain sector in the form for example of farm expansion subsidies our purpose is to assess the potential impacts of china s farm scale expansion on both yields and per hectare economic returns analysis of a large sample of farm household production data finds with some exceptions that grain yields likely will decline as farm size grows compromising food self sufficiency targets more importantly in only isolated cases would per hectare economic returns decline with size thus an emphasis on reducing farmland transactions costs may stimulate cropland consolidation and achieve the desired long term structural transformation

what does she see in him the effect of sharing on the choice of spouse all husbands and wives share in the spoils of marriage sharing makes each partner a residual claimant and encourages spouses to provide marital inputs however because each spouse is only a partial residual claimant each may be inclined to provide a suboptimal level of marital inputs the choice of spouse influences the level of distortion and under some circumstances the eficient mating is between individuals of equal value people tend to end up choosing partners of approximately their own social worth romantic choices appear to be a delicate compromise between one s desire to capture an ideal partner and one s realization that he must eventually settle for what he deserves

the inverse relationship between size of land holdings and agricultural productivity the important relationship between the size of land holdings and agricultural productivity in developing countries has been debated intensely from early soviet debates to the extensive literature generated by the release of farm management survey fms data in india the question of returns to scale and input productivities primarily for land in traditional agriculture has been confused and clouded by strong positions and ideological predilections bhagawati and chakravarty saini 1969 and bharadwaj provide extensive bibliographies on the theoretical and empirical aspects of this problem in the indian context briefly sen 1964 1966 mazumdar 1963 1965 c h h rao 1966 1970 khusro saini 1971 bhattacharya and saini more or less endorse an inverse relationship between the land size and its productivity a p rao 1963 and rudra and bandhopadhyay do not believe in the existence of an inverse relationship and argue that no systematic relationship can be established between any two variables describing land size and productivity bharadwaj and others dismiss the statistical validity of an inverse relationship but generally accept it as a stylized fact the approach used in these statistical studies is to employ aggregate average or farm level data within a village or among different villages for all crops or a few specific ones various concepts of productivity and input variables are used the actual regressions use linear or log linear functional forms using the pooled fms data for several states in south india this paper makes an attempt to reexamine in a more general way the relationship between the size of land holdings and agricultural productivity this study employs the transcendental logarithmic translog function to formalize the relation between output and an arbitrary number of inputs the translog function is not locally constrained by assumptions of homogeneity or additivity estimates of output elasticity with respect to land size for various values of cooperating inputs will indicate whether the alleged inverse relationship holds in any or all circumstances

human capital infrastructure and the productivity of indian rice farmers abstract along with investments in agricultural research extension and education limited investment in transportation and communication infrastructure is often identified as an important constraint on the diffusion and use of new agricultural technology yet there are few systematic studies of the relationship between agricultural infrastructure and agricultural productivity and there do not appear to be any studies which model and measure the productivity effect of infrastructure at the farm level the aim of this paper is to fill this theoretical and empirical hiatus by investigating how human capital and infrastructure constrain the choice of technology and hence productivity the effects of these capital constraints are translated into a variable coefficient production function to measure their productivity effects on indian rice farmers the findings indicate that productivity is a function of the farmer s schooling extension programs transportation and communication infrastructure irrigation availability the utilization of high yielding varieties and climatic factors these findings thus support the hypothesis that agricultural productivity is a function of transportation and communication infrastructure and suggest that infrastructure development is important to both growth and equity concerns in policy planning

trade and trade policy with imperfect competition the case of identical products and free entry abstract this paper analyses intra industry trade between economies containing an imperfectly competitive industry in which firms produce a homogeneous output production is subject to increasing returns to scale and there is free entry and exit of firms trade is shown to unambiguously increase welfare by reducing the degree of monopoly in each market and increasing firm size the effects of differences in technology and endowments on the pattern of trade and welfare are examined import tariffs are shown to raise welfare in the country employing the tariff and the welfare implications of various types of industry subsidy are examined

looking at pro poor growth from an agricultural perspective summary pro poor growth has been identified as one of the most promising pathways to accelerate poverty reduction in developing countries the diagnostic pro poor growth toolbox has so far focused on the income dimension as well as key non income achievements in education and health this article contributes to the literature by expanding the toolbox with several new measures that take into account the extraordinary importance of agricultural productivity for poverty reduction in developing countries we distinguish between land productivity and labor productivity and find that the poor identified by low incomes poor education outcomes low land productivity and low labor productivity overlap only to a small degree suggesting that analyses of pro poor growth from these different perspectives are complementary the toolbox is then applied to three comparable household surveys from rwanda eicv data for the years 1999 2001 2005 06 and 2010 11 a country that has experienced impressive economic growth since the genocide in the mid 1990s and that has undertaken considerable efforts to increase agricultural productivity and improve the population s access to social services over the first decade of the 2000s our application shows that the enormous progress made in the income education and health dimension of well being has been pro poor according to most definitions of the concept the new tools reveal that the land productivity poor experienced pro poor growth in the relative and absolute sense while the labor productivity poor increased their labor productivity relatively but not absolutely faster than the labor productivity rich even though the former dispose of considerably lower education levels

land reforms poverty reduction and economic growth evidence from india recognition of the importance of institutions that provide security of property rights and relatively equal access to economic resources to a broad cross section of society has renewed interest in the potential of asset redistribution including land reforms empirical analysis of the impact of such policies is however scant and often contradictory this paper uses panel household data from india together with state level variation in the implementation of land reform to address some of the deficiencies of earlier studies the results suggest that land reform had a significant and positive impact on income growth and accumulation of human and physical capital the paper draws policy implications especially from the fact that the observed impact of land reform seems to have declined over time

inadequacies of the strategic rationale of export subsidies a major attraction of strategic trade theory is that it appears to explain governments desire to subsidise exports we argue that this appearance is illusory

efficiency and equity impacts of rural land rental restrictions evidence from india recognition of the potentially deleterious implications of inequality in opportunity originating in a skewed asset distribution has spawned considerable interest in land reforms however little attention has been devoted to fact that in the longer term the measures used to implement land reforms could negatively affect productivity use of state level data on rental restrictions together with a nationally representative survey from india suggests that contrary to original intentions rental restrictions negatively affect productivity and equity the restrictions reduce the scope for efficiency enhancing rental transactions that benefit poor producers simulations suggest that by doubling the number of producers with access to land through rental from about 15 million currently liberalization of rental markets could have far reaching impacts

market failure and control of labour power towards an explanation of structure and change in indian agriculture part 1 1 although existing approaches do on occasion shed light on certain specific aspects of indian agriculture in general they run into problems of methodology or content or more frequently both in particular it is misleading to treat indian agri culture in peasant economy no markets or neoclassical perfect market terms and problematic to view it as semi feudal markets subordinate to extra economic factors 2 analysis of the relationships between farm size land productivity sharecropping and mechanisation suggest the need for an integrated model which emphasises both the unemployment and poverty of poor peasants and the problems of supervision and control of wage labour and tenants 3 proper appreciation of the interlinked role of these factors can help to explain the system s inability to combine the abundant labour of the poor with resources owned largely by the rich it can also go on to explain institutional responses like sharecropping as partial solutions to the problem of intensifying labour use and technological ones such as mechanisation as a means of delinking large farm growth from the need to intensify labour use 4 the tensions and choices between these responses underlie both the problem of stagnation and the phenomenon of switches from sharecropping to mechanisation 5 for associated reasons more rapid growth in indian agriculture is unlikely without major institutional changes to create much new employment and is likely to be more capital intensive than is usually assumed

access to capital and agrarian production organisation there are two problems both universal that entrepreneurs in any economy must contend with firstly an agent generally has access only to a limited amount of working capital secondly workers hired by an agent are subject to moral hazard and this necessitates their supervision this paper models for an agrarian economy the constraints imposed on entrepreneurs activities by these two problems and endogenously determines the various organisational forms of production as well as the allocation of resources that will obtain with a simple model we endeavour to explain a diverse set of empirical observations pertaining to the less developed countries in terms of the general processes that determine the distribution of income among the various agents and the hierarchical relationships that develop among them agricultural production typically involves a period of several months between the time the inputs are purchased and the time the output is marketed access to working capital and hence to the credit market thus plays an important role in a farmer s production decisions the distribution of access to credit in turn tends to be an important determinant of income distribution in poor agrarian economies credit is invariably rationed according to the ability to offer collateral the amount of working capital a farmer can mobilise therefore depends on the amount of land he owns which is often a good proxy for his overall wealth and thus his ability to offer collateral further since hired hands have a propensity to shirk they need to be supervised and therefore the

the impact of market friendly reforms on credit and land markets in honduras and nicaragua summary this article explores the impacts on credit access and agrarian structure of land market liberalization policies undertaken in honduras and nicaragua during the 1990s like liberalization efforts pursued in many latin american countries these market friendly reforms were designed to activate land transfers and enhance agricultural efficiency in large part by improving the access of the rural poor to both credit and land markets panel data sets gathered in honduras and nicaragua are used to compare title credit and land access patterns before and after the reforms descriptive nonparametric regression analyses show that despite major gains in titling across the land size spectrum and some increase in land market activity the other hoped for improvements in credit and land access did not occur and appear unlikely to occur without further policy attention to credit markets

does supervision matter some hypothesis tests using indian farm level data abstract a model is developed and estimated to test for heterogeneity of family and hired labor in agricultural production and to estimate the impact of employer supervision on the productivity of hired labor plot level data are used from a rice growing village in semi arid tropical india the hypothesis that family and hired labor are homogeneous inputs was rejected results indicate that family member supervision is required to increase hired labor productivity output loss attributable to operating at reduced supervision intensity was greater than 10 on over 40 of the plots

an efficient nonmarket institution under imperfect markets labor sharing for tropical forest clearing this article examines the substitutability efficiency and evolution of an important nonmarket institution in agrarian societies labor sharing from analyses of field level data on forest clearing through time among shifting cultivators in the peruvian amazon we find 1 no productivity difference and unitary elasticities of substitution among family hired and cooperative labor i e perfect substitutes 2 the combination of labor market and sharing makes total labor use unconstrained by household and network endowments i e efficient labor allocation and 3 as labor composition is constrained by network endowments and liquidity credit policies alter not only labor composition but also network formation

testing between competing models of sharecropping the marshallian approach assumes a prohibitively high cost of monitoring the sharecropper s activities while the monitoring approach argues that landlords stipulate and effectively monitor sharecroppers activities i present new evidence using detailed data collected from eight indian villages most tenants own some land of their own this provides a controlled environment in studying the impact of contractual arrangements the differences in input and output intensities on owned minus sharecropped land of the same household are found to be sizable and significant suggesting a rejection of the monitoring approach and supporting the notion of the marshallian productive inefficiency of sharecropping

applying real options analysis to assess cleaner energy development strategies abstract the energy industry accounts for the largest portion of co 2 emissions is facing the issue of compliance with the national clean energy policy the methodology for evaluating the energy mix policy is crucial because of the characteristics of lead time embedded with the power generation facilities investment and the uncertainty of future electricity demand in this paper a modified binomial model based on sequential compound options which may account for the lead time and uncertainty as a whole is established and a numerical example on evaluating the optional strategies and the strategic value of the cleaner energy policy is also presented it is found that the optimal decision at some nodes in the binomial tree is path dependent which is different from the standard sequential compound option model with lead time or time lag concept the proposed modified binomial sequential compound real options model can be generalized and extensively applied to solve the general decision problems that deal with the long lead time of many government policies as well as capital intensive investments

improving the attractiveness of cdm projects through allowing and incorporating options abstract the paper puts forward a proposal that within clean development mechanism cdm projects investors be allowed to benefit from options this will require a cdm rule change through the presence of options the downside risk resulting from low carbon prices and or low achieved emission reductions on projects can be limited while any upside resulting from high carbon prices and or high achieved emission reductions can be taken advantage of it is demonstrated that the presence of options improves the financial attractiveness of cdm projects and this is at no detriment to any stakeholder the flow on from the proposal is that more cdm projects should be realisable if options are available and this in turn will lead to reduced global emissions and improved sustainability the proposal is supported by the necessary theory and is demonstrated on two registered cdm projects one on hydropower and one on wind power

labor supervision and institutional conditions evidence from bicol rice farms this article analyzes labor supervision activities reported in a survey of rice farmers in the bicol region of the philippines we present a theoretical model that relates supervision intensity to institutional conditions we estimate a supervision intensity equation and control for the decision to hire labor the decision to supervise hired labor and the type of the labor contract the empirical estimates use different village level spatial and demographic indicators as proxies for institutional conditions the results are consistent with the prediction of the theoretical model that supervision increases with weaker institutional conditions

tenancy and family resources a model and some empirical analysis abstract in this paper we discuss with the help of a simple model the role of family resource endowments in determining the extent of land leased in or leased out by a household this becomes important when the market for some of these resources is either not functioning at all or is functioning imperfectly we focus on three such resources which have some relevance in indian agriculture these are 1 the family s managerial skill 2 its endowment of human labour and 3 its endowment of draft animal labour household level data from six villages of maharashtra and andhra pradesh are also utilized to test some of the hypotheses

agriculture in the process of development a micro perspective abstract this paper compares national level data from india with 40 years of household panel data from rural india to track sectoral changes in employment and income as well as examine the hypothesis of induced innovation in agricultural production in the national data india appears to be in the midst of a structural transformation the share of agriculture in gdp and employment has shrunk while agricultural output continues to grow this productivity growth appears to adhere to the induced innovation hypothesis as productivity per hectare has increased more rapidly than productivity per worker many of the same patterns exist in the household data tracking households across time i observe agricultural output has increased despite more households engaging in off farm labor household agricultural production is highly specialized and has increased its reliance on improved inputs however while agricultural income has grown industrial and service income has remained stagnant and the relative income of these households has declined in recent years

household composition labor markets and labor demand testing for separation in agricultural household models this paper tests the separation of farm labor supply and labor demand decisions using the observation that household composition is an important determinant of farm labor use with nonseparation after assessing the conditions under which the test has power against several alternatives an empirical model is developed to test the proposition that farm employment is independent of family composition the model is estimated on a data set from rural java the null hypothesis that farm labor allocation decisions are independent of household structure is not rejected the results are robust to different specifications of the labor demand function copyright 1992 by the econometric society

on price risk and the inverse farm size productivity relationship abstract the oft observed inverse relationship between farm size and productivity has elicited several explanations having important policy and theoretical implications using advances in the analysis of price risk effects on producer behavior and a simple two period model of an agricultural household that both produces and consumes under price uncertainty at the time labor allocation decisions are made this paper demonstrates analytically that a non degenerate land distribution and price risk can together produce an inverse relationship even absent any of the more common explanations empirical evidence from madagascar confirms the plausibility of this intuitive explanation for the phenomenon

comparative advantage and the pursuit of strategic trade policy in the brander and spencer model j int econ 18 1985 83 100 it is shown that the absolute value of the export subsidy tax given by the country with low cost firm is larger than that given by the country with the high cost firm

tenure systems in traditional china i a general equilibrium model of tenure preference classical marginalists at least after john clark provide an unequivocal solution for the conventional factor market where people sell the productive services of their resources to producers the productexhaustion theorem says that if factors are priced according to their marginal products incomes of all resource owners will exactly exhaust the value of total products in the long run competitive equilibrium this holds true regardless of which factor is variable and which is fixed and regardless of which group of resource owners perform as producers who buy productive services of other resources in the market and claim residuals for themselves in an agrarian economy with land and labor as the inputs a land owner may cultivate his land and purchase the labor input from outside paying a wage rate in accordance with labor s marginal product the land owner is then the residual claimant alternatively he may lease out his land and receive a fixed rental rate per unit of area equal to the marginal product of land in this case the tenant is the producer and claims the residual income distribution between the two parties remains the same under each land arrangement wage and rent are therefore identical conceptually the classical marginal analysis has not presented a satisfactory theory of share tenancy which instead of being a seller buyer transaction in a conventional factor market is essentially a partnership arrangement between two persons who own complementary factors hence the term land renting will hereafter denote the fixed rent system exclusively in fact the direct application of marginal analysis to share tenancy has created considerable confusion in early economic literature only recently some general equilibrium models of land tenure systems have been developed for better understanding of the

contract choice in modern agriculture cash rent versus cropshare e conomists have expended enormous effort examining the rationale for various contractual arrangements in agriculture particularly sharecropping while economists have made considerable theoretical efforts to understand agricultural contracts few empirical studies have been undertaken the dearth of empirical analyses of agricultural contracts is particularly striking for modern western agriculture this is an important omission not only because the existing empirical work tends to focus on the question of efficiency but also because the theoretical models tend to examine contracts that bear little resemblance to those found in the united states today

credit layering in informal financial markets abstract informal lenders with access to markets or capital often find it attractive to delegate loan provision to downstream lenders who have an information or enforcement advantage in dealing with particular borrowers in this paper we examine the conditions under which such an arrangement is preferred by two informal lenders a landlord and a merchant who compete in loan provision to tenant farmers differentiated by wealth we show that credit layering is preferred only when tenants are sufficiently poor in this case the trader lends to tenant farmers via a contract with their landlord otherwise only the trader lends as a consequence a pattern of borrowing emerges in which relatively wealthy tenants borrow from merchants while poor tenants borrow mainly from their landlords interlinkage between land and credit thus arises only for a subset of tenants and purely as a consequence of credit layering this pattern is shown to be supported empirically

real options analysis for renewable energy investment decisions in developing countries abstract renewable energy projects in developing countries should provide clean energy supply as well as support sustainable economic development to this end risks arising from uncertainties such as rapidly changing technologies and host government conditions should be carefully addressed however traditional methods for economic assessment are not adequate to support decision making regarding investments in renewable energy this paper proposes a real options analysis framework as a tool to assess renewable energy investment in developing countries a case study involving a hydropower project in indonesia was conducted to validate and verify the proposed framework this framework is expected to help host countries and investors assess renewable energy projects with high volatility and risk

from policy aims and small farm characteristics to farm science needs this paper examines the agricultural science needs of small farms the green revolution successfully negotiated two tightropes agricultural productivity increases were larger than the fall in prices that resulted from producing more food and output per hectare rose faster than output per worker thus increasing the demand for labor the current challenge is to generate technology that helps poor farmers in low potential areas since research capacity is increasingly private incentives to produce the needed technology are needed perhaps through contracts to produce varieties with specific characteristics development of seeds needs complementary work on water for which economists plant scientists and engineers need to pool their skills

the long reach of cotton in the us south tenant farming mechanization and low skill manufacturing abstract this paper examines the long run impact of cotton agriculture on local development in the us south focusing on a novel aspect of structural change exploiting climate based variation in cotton production i show that cotton specialization in the late 19th century had a negative impact on local development that lasts through 2010 this negative relationship however only became evident in the second half of the 20th century i argue that the change was caused by the mechanization of cotton production which began in the 1950s after the mechanization local manufacturing absorbed displaced cotton tenants with low human capital in response to the inflow of cotton tenants labor productivity in manufacturing began to decline and the effects persisted in the long run the persistent decline in manufacturing productivity is explained by directed technical change that reduced demand for skills in manufacturing these results indicate that depending on the agricultural background structural change can negatively affect the evolution of technology and productivity in the industrial sector

modeling farm households price responses in the presence of transaction costs and heterogeneity in labor markets we develop a farm household model to analyze price responses of farm households this model incorporates various types of transaction costs as well as labor heterogeneity nonproportional variable transaction costs or labor heterogeneity imply that production and consumption decisions become nonseparable even when the household buys or sells labor an empirical model is estimated using data from midwest poland the results show that nonproportional variable transaction costs and labor heterogeneity significantly influence household behavior not all price elasticities however change significantly if these are neglected

land distribution and international agricultural productivity the unequal distribution of agricultural land is often cited as a source of inefficiency in agriculture previous cross country studies of agricultural productivity differences though have not considered land inequality this article addresses this issue by using cross country data on inequality in operational holdings of agricultural land from deininger and squire 1998 in an estimation of an agricultural production function the gini coefficient for land holdings is found to have a significant negative relationship with productivity this is consistent with the existence of heterogeneity in productivity by farm size within countries a one standard deviation drop in the gini coefficient implies an increase in productivity of 8 5

transaction costs institutional rigidities and the size of the clean development mechanism transaction costs and institutional rigidities will reduce the attractiveness of the kyoto protocol flexibility mechanisms compared to domestic greenhouse gas abatement options the clean development mechanism cdm in particular is likely to entail considerable costs of baseline development project registration verification and certification the activities implemented jointly pilot phase and the prototype carbon fund programme give indications about these costs there is evidence that projects with high implementation costs have high transaction costs as well moreover cdm projects have to be approved by host country institutions and so far only a small share of host countries has been able to set up these institutions several of the larger host countries intend to only approve projects if the market price is above a certain threshold some governments will also levy fees to finance costs of approval bodies we assess these issues using a quantitative model of the kyoto protocol permit market we conclude that while changes in demand from annex b countries remain the crucial factor the size of the cdm will depend to a significant degree on transaction costs and institutional barriers in host countries

is there a farm size productivity relationship in african agriculture evidence from rwanda whether the negative relationship between farm size and productivity that is confirmed in a large global literature holds in africa is of considerable policy relevance this paper revisits this issue and examines potential causes of the inverse productivity relationship in rwanda where policy makers consider land fragmentation and small farm sizes to be key bottlenecks for the growth of the agricultural sector nationwide plot level data from rwanda point toward a constant returns to scale crop production function and a strong negative relationship between farm size and output per hectare as well as intensity of labor use that is robust across specifications the inverse relationship continues to hold if profits with family labor valued at shadow wages are used but disappears if family labor is rather valued at village level market wage rates these findings imply that in rwanda labor market imperfections rather than other unobserved factors seem to be a key reason for the inverse farm size productivity relationship

behavioural and material determinants of production relations in agriculture in this essay we develop a framework for analysing the major institutions governing the production and exchange of output and the primary factors of production in rural areas the analysis incorporates general considerations of risk and information constraints jointly with the principal material attributes of agriculture and of agricultural production factors the framework is used to analyse barriers to the existence of the major intertemporal and factor markets it is applied specifically to land scarce environments for which it provides an internally consistent explanation for many of the well documented institutional features of such settings in addition the analysis provides new implications for among other phenomena the inter relationships among ownership holdings operational scale family size and factor productivity for the scarcity of animal rental markets and use of animals as collateral for the renting out of land by small landowners and for the existence of plantations for certain crops

factor markets and resource allocation in colonial punjab it is often argued that agricultural factor markets in colonial india were underdeveloped leading to inefficient resource use and slow agricultural development however there is little econometric evidence on these issues this article outlines a model which incorporates the factor market imperfections discussed in the literature and tests the model against data from the punjab there is in the statistical sense evidence of resource misallocation however these effects are too small to be of much economic significance

the complex dynamics of smallholder technology adoption the case of sri in madagascar this article explores the dynamics of smallholder technology adoption with particular reference to a high yielding low external input rice production method in madagascar we present a simple model of technology adoption by farm households in an environment of incomplete financial and land markets we then use a probit model and symmetrically censored least squares estimation of a dynamic tobit model to analyze the decisions to adopt expand and disadopt the method we find that seasonal liquidity constraints discourage adoption by poorer farmers learning effects both from extension agents and from other farmers exert significant influence over adoption decisions

international r d rivalry and industrial strategy this paper presents a theory of government intervention which provides an explanation for industrial strategy policies such as r d or export subsidies in imperfectly competitive international markets domestic net welfare is improved by the capture of a greater share of the output of rent earning industries although the subsidy ridden noncooperative international equilibrium is jointly suboptimal behaviour of governments and firms is modelled as a three stage subgame perfect nash equilibrium the assumption that the government is the first player in this game allows it to influence equilibrium outcomes by altering the set of credible actions open to firms

bertrand edgeworth oligopoly in large markets the relation between perfectly competitive and monopolistically competitive equilibria is analysed for a bertrand edgeworth model of a single market in which capacity constrained firms choose prices as strategies the market always has a nash equilibrium in pure or mixed strategies as the number of firms increases the corresponding equilibria converge in distribution to a perfectly competitive price this result provides a justification for perfect competition that is based on an explicit account of price formation however monopoly prices persist with a positive but vanishing probability regularity or well defined inverse demand functions are not required

how to make the clean development mechanism sustainable the potential of rent extraction the clean development mechanism cdm should foster sustainable development and greenhouse gas emission reductions the design of the cdm and first experience suggest that it may not achieve these goals developing countries hosting cdm projects may lose cheap emission reduction possibilities for their own future use and sustainable development and technology transfer may not take place on the other hand the cdm has the potential to generate considerable rents if permit prices are high or costs low to account for equity and distributional issues a deliberate decision on how to distribute these rents could be taken and the potential failure of the cdm in meeting its goals calls for some further regulation i suggest to combine these two issues and to extract the rents by a profit tax ideally the tax revenues could contribute to national sustainable development strategies to offset external costs imposed by cdm projects and to extract part of the resource rent they may generate the international character of the cdm could offer a frame for internationally coordinated tax design this would hedge against a potential race to the bottom

collective agricultural production a solution for transition economies abstract the paper examines theoretical reasons and provides examples for productivity differences between agricultural service cooperatives and collectives service cooperatives can utilize economies of scale enhance competitiveness and provide technical information advantages that often outweighed problems of free riding low investment and excessive political intervention agricultural collectives while not adding substantial advantages are in addition associated with problems of supervision and effort supply tendencies to substitute casual workers or mechanization for regular members and low investment incentives while collective forms of organization in transition economies respond to high risk and market imperfections they do so inefficiently policies that create conditions for service cooperatives to compete may lead to large productivity gains

off farm work and capital accumulation decisions of farmers over the life cycle the role of heterogeneity and state dependence abstract this paper analyzes two principal simultaneous decisions of farm operators off farm labor supply and farm capital investment we first develop a theoretical model analyzing the effects of exogenous shocks on farmers decisions then we estimate jointly a multinomial probit model of farmers off farm labor supply and a switching regression model of farm capital using a two period panel data set from israel this method enables to account for both unobserved heterogeneity and structural state dependence the results demonstrate that farm capital investments during the 1970s which were enhanced by heavily subsidized credit prevented farmers from seeking off farm employment opportunities

off farm work technical efficiency and rice production risk in taiwan this article investigates the differences in yield production production efficiency and yield risk for farmers both with and without off farm work using a nationwide survey of rice farmers in taiwan we estimate two stochastic production frontier models that accommodate technical inefficiency and production risk simultaneously for farmers both with and without off farm work the stochastic dominance criterion is then applied to compare the differences in the distributions of the estimated technical efficiency and yield risk between groups the empirical results indicate that these two groups of farmers use resources in different ways and off farm work is not necessarily associated with lower technical efficiency for farmers in the lower percentiles of the efficiency distribution those with off farm work are more efficient than their counterparts without off farm work in addition farmers with off farm work face higher production risk and this result is robust for the entire distribution

the relation between farm size and farm productivity the role of family labor supervision and credit constraints abstract the paper shows that if the performance of hired farmhands is affected by supervision from family members and if the availability of credit is dependent on the amount of land owned then a systematic positive or negative relationship between per acre yields and farm size will prevail a model with no supervision effects on labor productivity would predict that yields are unaffected by farm size the paper also investigates the relation between land utilization and owned holding size when land rental possibilities are limited results are shown to be compatible with various observed patterns in ldcs