cost sharing arrangements under sharecropping moral hazard incentive flexibility and risk this paper explains the rationale and describes the characteristics of cost sharing arrangements in rural developing economies focusing on the risk and incentive properties of alternative cost contracts and on their flexibility their ability to adapt to environmental changes it is shown that where labor inputs are difficult to monitor the rule that cost shares and output shares be equalized will not hold and is not constrained pareto efficient and that cost sharing contracts have a decided advantage over contracts which specify the level of inputs whenever there are asymmetries of information regarding production technology between the landlord and the tenant

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

co2 emission standards and investment in carbon capture abstract policy makers in a number of countries have proposed or are considering proposing co 2 emission standards for new fossil fuel fired power plants the proposed standards require coal fired power plants to have approximately the same carbon emissions as an uncontrolled natural gas fired power plant effectively mandating the adoption of carbon capture and sequestration ccs technologies for new coal plants however given the uncertainty in the capital and operating costs of a commercial scale coal plant with ccs the impact of such a standard is not apparent a priori we apply a stochastic generation expansion model to determine the impact of co 2 emission standards on generation investment decisions and in particular for coal plants with ccs moreover we demonstrate how the incentive to invest in coal ccs from emission standards depends on the natural gas price the co 2 price and the enhanced oil recovery price as well as on the level of the emission standard this analysis is the first to consider the entire power system and at the same time allow the capture percentage for ccs plants to be chosen from a continuous range to meet the given standard at minimum cost previous system level studies have assumed that ccs plants capture 90 of the carbon while studies of individual units have demonstrated the costs of carbon capture over a continuous range we show that 1 currently proposed levels of emission standards are more likely to shift fossil fuel generation from coal to natural gas rather than to incentivize investment in ccs 2 tighter standards that require some carbon reductions from natural gas fired power plants are more likely than proposed standards to incentivize investments in ccs especially on natural gas plants but also on coal plants at high gas prices and 3 imposing a less strict emission standard emission rates higher than natural gas but lower than coal e g 1500 lbs mwh is more likely than current proposals to incentivize investment in coal ccs technology but only at high gas prices and to a lesser extent than a stringent standard e g 300 lbs mwh

natural gas overview for world economy from primary supply to final demand via global supply chains abstract as the world is smoothing the transition towards a low carbon energy structure natural gas has occupied a critical position in global energy supply also globalization has catalyzed ever increasing indirect energy flows in international trade in order to present a comprehensive overview of natural gas use in globalized economy this paper applies the systems multi regional input output mrio analysis to track natural gas use from primary suppliers to final consumers via the links by producers in the world economy supported by typical statistics for the year of 2011 natural gas embodied in international trade is revealed amounting to 2722 1 bcm in magnitude up to 90 of total gas extraction for energy use indicating the intensive relocation of gas use by trade 83 of traded embodied natural gas is associated with intermediate trade mainly from leading primary suppliers including russia usa and western asia to dominant final consumers like usa eu27 and east asia significant differences are found between direct and embodied natural gas flows consumption based resource efficiency can break the illusion of efficiency improvements and trade imbalance in terms of gas use can be opposite to the trade imbalance in conventional monetary terms this paper has constructed a comprehensive analytical framework to trace natural gas flows in globalized economy for the first time aiming to provide new insights for policy making

weak instruments diagnosis and cures in empirical econometrics what is the weak instruments wi problem and what causes it universal agreement does not exist on these questions we define weak instruments by two features i two stage least squares 2sls analysis is badly biased toward the ordinary least squares ols estimate and alternative unbiased estimators such as limited information maximum likelihood liml may not solve the problem and ii the standard first order asymptotic distribution does not give an accurate framework for inference thus a researcher may estimate bad results and not be aware of the outcome the cause of wi is often stated to be a low r or f statistic of the reduced form equation in the most commonly occurring situation of one right handside endogenous variable we find the situation is more complex with an additional factor the correlation between the stochastic disturbances of the structural equation and the reduced form that needs to be taken into account we discuss in this paper a specification test hahn and hausman 2002a for wi a caution against using no moments estimators such as liml in the wi situation and suggestions for different estimators an approach to inference of frank kleibergen 2002 for wi we end with a caution of how small biases can become large biases in the wi situation we begin with the limited information structural model under the assumptions of hausman 1983

the future of u s natural gas production use and trade two computable general equilibrium models one global and the other providing u s regional detail are applied to analysis of the future of u s natural gas the focus is on uncertainties including the scale and cost of gas resources the costs of competing technologies the pattern of greenhouse gas mitigation and the evolution of global natural gas markets results show that the outlook for gas over the next several decades is very favorable in electric generation given the unproven and relatively high cost of other low carbon generation alternatives gas is likely the preferred alternative to coal a broad ghg pricing policy would increase gas use in generation but reduce use in other sectors on balance increasing its role from present levels the shale gas resource is a major contributor to this optimistic view of the future of gas gas can be an effective bridge to a lower emissions future but investment in the development of still lower co2 technologies remains an important priority international gas resources may well prove to be less costly than those in the u s except for the lowest cost domestic shale resources and the emergence of an integrated global gas market could result in significant u s gas imports

the effectiveness of policies to transform a gas exporting country into a gas transit country the case of the netherlands the netherlands has been a major european natural gas producer and exporter for many decades but now faces the challenge to deal with diminishing resources in response the dutch government initiated a gas hub strategy which is the policy to transform the gas industry from an export oriented business into a transit oriented business this policy included a number of investments in the gas infrastructure as well as institutional reforms to enhance the liquidity of the gas market we study the effects of this gas hub policy using hourly data on the dutch gas balance over the period 2006 2013 we find that gas storage and trading have become more important but that the level of gas in transit in the netherlands remained fairly constant consequently the dutch gas industry is still mainly oriented on domestic production and export of gas while the dutch gas hub ttf has become a key virtual trading place the policy lesson from the dutch experience is that implementing a gas hub strategy requires significant investments in the gas infrastructure while their effects do not necessarily become visible in the short run

an electricity generation planning model incorporating demand response abstract energy policies that aim to reduce carbon emissions and change the mix of electricity generation sources such as carbon cap and trade systems and renewable electricity standards can affect not only the source of electricity generation but also the price of electricity and consequently demand we develop an optimization model to determine the lowest cost investment and operation plan for the generating capacity of an electric power system the model incorporates demand response to price change in a case study for a u s state we show the price demand and generation mix implications of a renewable electricity standard and of a carbon cap and trade policy with and without initial free allocation of carbon allowances this study shows that both the demand moderating effects and the generation mix changing effects of the policies can be the sources of carbon emissions reductions and also shows that the share of the sources could differ with different policy designs the case study provides different results when demand elasticity is excluded underscoring the importance of incorporating demand response in the evaluation of electricity generation policies

climate change policy in brazil and mexico results from the mit eppa model based on an in depth analysis of results from the mit economic projection and policy analysis eppa model of climate policies for brazil and mexico we demonstrate that commitments by mexico and brazil for 2020 made during the un climate meetings in copenhagen and cancun are reachable but they come at different costs for each country we find that brazil s commitments will be met through reduced deforestation and at no additional cost however mexico s pledges will cost 4 billion us dollars in terms of reduced gdp in 2020 we explore short and long term implications of several policy scenarios after 2020 considering current policy debates in both countries the comparative analysis of these two economies underscores the need for climate policy designed for the specific characteristics of each country accounting for variables such as natural resources and current economic structure our results also suggest that both brazil and mexico may face other environmental and economic impacts from stringent global climate policies affecting variables such as the value of energy resources in international trade

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

productivity effects of land rental market operation in ethiopia evidence from a matched tenant landlord sample as countries increasingly strive to transform their economies from agriculture based into a diversified one land rental will become of greater importance it will thus be critical to complement research on the efficiency of specific land rental arrangements such as sharecropping with an inquiry into the broader productivity impacts of the land rental market plot level data for a matched landlord tenant sample in an environment where sharecropping dominates allow us to explore both issues the author fined that pure output sharing leads to significantly lower levels of efficiency that can be attenuated by monitoring while the inefficiency disappears if inputs are shared as well rentals transfer land to more productive producers but realization of this productivity advantage is prevented by the inefficiency of contractual arrangements suggesting changes that would prompt adoption of different contractual arrangements could have significant benefits

justifying the first order approach to principal agent problems it is of interest to know when the incentive compatibility conditio n in principal agent problems can be replaced by the condition that the agent s expected utility be stationary in effort the mirrlees rogerson conditions do not work if the principal can observe more than one observable statistic also the mirrlees rogerson assumption that the distribution function of output is convex in the agent s action is unsatisfactory even in the context of the basi c model it is too restrictive the paper presents a suite of conditio ns that are applicable to the multistatistic case and replaces the objectionable convex distribution function assumption copyright 1988 by the econometric society

impacts of tenancy arrangements on investment and efficiency evidence from pakistan in this article we use farm level data from the punjab province in pakistan to analyze the impact of three tenancy contracts on investment in soil improving and productivity enhancing measures and farm productivity a multivariate tobit model that accounts for potential substitutability and complementarity of investment options as well as endogeneity of tenure arrangements was employed in the empirical analysis our empirical results indicate that land tenure arrangements influence farmers decisions to invest in soil improving and productivity enhancing measures in particular owner cultivators with secured tenancy arrangements were found to be more likely to invest in soil improving and productivity enhancing measures compared to those on leased contracts we also find that output per hectare was highest on land cultivated by owners and lowest on land under sharecropping tenancy lending support to the marshallian inefficiency hypothesis

on moral hazard and cost sharing under sharecropping in this article we show that when the tenant s input use is not observable by the landlord there will be cost sharing at the margin instead of a lump sum transfer if the standard model is extended to include cases of imperfection and interlinkage of transactions in rural markets thus making the opportunity cost of inputs different for the landlord and the tenant

on the validity of econometric techniques with weak instruments inference on returns to education using compulsory school attendance laws we evaluate angrist and krueger 1991 and bound jaeger and baker 1995 by constructing reliable confidence regions around the 2sls and liml estimators for returns to schooling regardless of the quality of the instruments the results indicate that the returns to schooling were between 8 and 25 percent in 1970 and between 4 and 14 percent in 1980 although the estimates are less accurate than previously thought most specifications by angrist and krueger 1991 are informative for returns to schooling in particular concern about the reliability of the model with 178 instruments is unfounded despite the low first stage f statistic finally we briefly discuss bias adjustment of estimators and pretesting procedures as solutions to the weak instrument problem

moral hazard experimental evidence from tenancy contracts agricultural productivity is particularly low in developing countries output sharing rules that make farmers less than full residual claimants are seen as a potentially important driver of low agr

synergy between pollution and carbon emissions control comparing china and the united states abstract we estimate the potential synergy between pollution and climate control in the u s and china summarizing the results as emissions cross elasticities of control in both countries ancillary carbon reductions resulting from so 2 and no x control tend to rise with the increased stringency of control targets reflecting the eventual need for wholesale change toward non fossil technologies when large reductions are required under stringent pollution targets the non target effects tend to be higher in china than in the u s due to china s heavy reliance on coal this result suggests that china may have greater incentives to reduce so 2 and no x with locally apparent pollution benefits but related efforts would at the same time reduce co 2 emissions significantly we also find strong non target effects of co 2 abatement in both countries but the cross effects in this direction depend less on the stringency of control and are stronger in the u s than in china

lng is linking regional natural gas markets evidence from the gravity model abstract evidence exists that global natural gas markets have become more integrated over time one possible explanation for this increased level of integration is that increased liquefied natural gas trade has increased the opportunity for price arbitrage by decreasing transport costs if this explanation is true then the natural gas market should become relatively more integrated because countries separated by large distances would be more willing to trade with each other we employ a gravity model to test whether trade in liquefied natural gas has helped to de regionalize the total natural gas market using trade in the compressed natural gas market as a comparison benchmark the results indicate that liquefied natural gas is indeed a global commodity whereas the compressed natural gas markets are more regional importantly we find that trade in liquefied natural gas has de regionalized the total natural gas market

moral hazard and marshallian inefficiency evidence from tunisia abstract we formalize the link between optimal cost sharing contracts and the production technology in the presence of moral hazard by appealing to several well known results from duality theory building on intuitions from the interlinkage literature we show that optimal contractual structure is determined by the i substitution possibilities that exist between different observable factor inputs as well as ii between these inputs and unobservable effort we endogenize contractual choice using landlord characteristics as instruments exploiting the fact that in our dataset landlords interact with several tenants and vice versa the approach is applied to an unbalanced plot level panel of cost sharing contracts in a tunisian village using a translog representation of the restricted profit function contractual terms are found to be a significant determinant of input use and therefore lead to marshallian inefficiency while the optimality of the underlying contractual structure is rejected

introduction north american natural gas markets in transition abstract over many decades energy markets have seen a variety of new technologies with the potential of replacing existing practices for providing conventional fossil fuels unlike synthetic fuels during the 1970s or hydrogen during the 2000s however hydraulic fracturing for producing natural gas shale resources has had a dramatic impact because it has been cost effective this article describes a model comparison effort organized by stanford s energy modeling forum and provides a brief overview of the principal findings by individual modeling teams that participated in the study

moral hazard land fertility and sharecropping in a rural area of the philippines abstract introducing concerns about land fertility for landlords in a principal agent model of sharecropping with moral hazard we show that the optimal contract under limited commitment reflects a trade off between production and land quality maintenance using data from the philippines a model where the leasing out and contract choices are simultaneous is estimated and avoids the selectivity bias of observed contracts landlords prefer to use more incentive contracts for more fertile plots and less incentive ones when crop choices induce land overuse empirical tests reject the model of pure risk sharing in production and show the interest of taking land quality maintenance into account

the demand for primary schooling in madagascar price quality and the choice between public and private providers abstract we estimate a discrete choice model of primary schooling and simulate policy alternatives for rural madagascar among school quality factors the results highlight the negative impacts on schooling demand of poor facility quality and the use of multigrade teaching several grades being taught simultaneously by one teacher in public schools simulations indicate the feasibility of reducing multigrade in public schools by adding teachers and classrooms a policy that would lead to modest improvements in overall enrollments and would disproportionately benefit poor children given much higher price elasticities for poorer households raising school fees to cover some of the additional costs would strongly counteract these favorable distributional outcomes an alternative policy of consolidation of primary schools combined with multigrade reduction or other quality improvements is likely to be ineffective because of the strongly negative impact of distance to school

exploring the driving factors of global lng trade flows using gravity modelling abstract taking into account the attributes of the liquefied natural gas lng trade and the space time characteristics of trade flows this paper identifies the multiple dimensional factors that influenced the global lng trade between 2004 and 2015 following an analysis of the data via the application of gravity models the empirical results of this study indicate that these influencing factors possess both general and regional characteristics in contrast to general trade the lng trade is mainly affected by the economic magnitude of the demand side regionally pipeline natural gas has a significant substitute effect on the lng trade within the global model though not within the asian model additionally the lng trade in asia is more sensitive to the influence of import prices and research and development investment than in the global model our subsample analyses show that the results are robustness across different periods finally this paper discusses pertinent policy implications for the lng trade especially as related to asia

sharecropping and the interlinking of agrarian markets one of the often noted features of less developed agrarian economies is the existence of interlinkages among the land labor credit and product markets the landlord is often the supplier of credit he frequently purchases and markets the output of the tenant farmers and often sells raw materials and even consumption goods to his tenant farmers how can this phenomenon be explained what are the welfare consequences of attempts to restrict these practices which often seem to constitute restraints on free trade these are the questions to which this paper is addressed a general set of arguments applicable to both competitive and noncompetitive environments are presented to situations where all the terms of the contract are determined in an optimal way as well as to situations where many of the terms are specified institutionally section i examines interlinked credit and tenancy contracts section ii examines interlinked marketing and tenancy contracts section iii points out the possible interlinking between labor contracts and consumption goods markets and section iv presents the different equilibrium frameworks discussed in the paper such as monopoly monopsony competition and equilibria with surplus labor

credit and land contracting a test of the theory of sharecropping author s das n de janvry a sadoulet e abstract 2019 the author s 2019 published by oxford university press on behalf of the agricultural and applied economics association all rights reserved for permissions please email journals permissions oup com choice of a share vs fixed rent land rental contract has figured prominently in the theory of industrial organization this theory tells us that while a share contract is inefficient in a first best world it may be the preferred option under second best conditions it has thus predicted the existence of sharecropping as the potentially preferred contract under conditions of liquidity constraint rigorous empirical evidence is however still lacking on this basic contribution of theory we use a randomized experiment in a credit program for landless workers and marginal farmers organized by brac in bangladesh to show that increased access to credit has a large positive effect on the choice of fixed rent over share rent contracts both in terms of number of contracts and area contracted as predicted by theory the magnitude of this shift away from sharecropping is enhanced when the tenant is less exposed to risk development programs that facilitate access to credit to potential tenants can thus help them take more efficient land rental contracts

sensitivity of natural gas deployment in the us power sector to future carbon policy expectations abstract one option for reducing carbon emissions in the power sector is replacement of coal fired generation with less carbon intensive natural gas combined cycle ngcc generation in the united states where there is abundant low cost natural gas supply increased ngcc deployment could be a cost effective emissions abatement opportunity at relatively modest carbon prices however under scenarios in which carbon prices rise and deeper emissions reductions are achieved other technologies may be more cost effective than ngcc in the future in this analysis using a us energy system model with foresight a version of the national energy modeling system or nems model we find that varying expectations about carbon prices after 2030 does not materially affect ngcc deployment prior to 2030 all else equal an important implication of this result is that under the set of natural gas and carbon price trajectories explored here myopic behavior or other imperfect expectations about potential future carbon policy do not change the natural gas deployment path or lead to stranded natural gas generation infrastructure we explain these results in terms of the underlying economic competition between available generation technologies and discuss the broader relevance to us climate change mitigation policy

natural gas uncertainty and climate policy in the us electric power sector abstract this paper investigates how uncertainties related to natural gas prices and potential climate policies may influence capacity investments utilization and emissions in us electricity markets using a two stage stochastic programming approach model results suggest that climate policies are stronger drivers of greenhouse gas emission trajectories than new natural gas supplies the dynamics of learning and irreversibility may give rise to an investment climate where strategic delay is optimal hedging strategies are shown to be sensitive to the specification of probability distributions for climate policy and natural gas prices highlighting the important role of uncertainty quantification in future research the paper also illustrates how this stochastic modeling framework could be used to quantify the value of limiting methane emissions from natural gas production

insecure land rights and share tenancy evidence from madagascar most studies of tenurial insecurity focus on its effects on investment this paper studies the hitherto unexplored relationship between tenurial insecurity and land tenancy contracts based on distinct features of formal law and customary rights in madagascar this paper augments the canonical model of sharecropping by making the strength of the landlord s property right increasing in the amount of risk she bears within the contract using data on landlords subjective perceptions in rural madagascar empirical tests support the hypothesis that insecure property rights drive contract choice but offer little support in favor of the canonical risk sharing hypothesis