DISCUSSION PAPER SERIESIZA DP No. 14263

Out of Communal Land:
Clientelism through Delegationof Agricultural Tenancy Contracts
Takashi Kurosaki
Saumik Paul
Firman Witoelar

APRIL 2021

DISCUSSION PAPER SERIESIZA DP No. 14263

Out of Communal Land:
Clientelism through Delegationof Agricultural Tenancy Contracts
Takashi Kurosaki

Hitotsubashi University

Saumik Paul

Newcastle University and IZA

Firman Witoelar

Australian National University

APRIL 2021

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IZA DP No. 14263

APRIL 2021

ABSTRACT
Out of Communal Land:
Clientelism through Delegationof Agricultural Tenancy Contracts*
Do local institutions influence the nature of political clientelist exchange? We find a positive
answer in the context of a village institution prevalent in Java since the Dutch colonial
rule, where democratically elected village heads receive usufruct rights over a piece ofcommunal village land (bengkok land) as a compensation for their service in lieu of salary.
To formulate how limited-term private ownership of bengkok land promotes clientelism,
we model a timely delegation of agricultural tenancy contracts to villagers-cum-voters as
an incumbent re-election strategy. Based on a household survey fielded in 2018 across 130
villages in Java, Indonesia, we find that the chances of a bengkok plot being rented out
increase by 6 percentage points as the time of the next election becomes closer by one year,
and sharecropping is preferred to a fixed-rental contract as the election approaches. The
empirical results are statistically significant and remain largely unchanged against a seriesof robustness checks. We also find suggestive evidence of short-term efficiency loss fromclientelist politics over bengkok land.
JEL Classification:

D72, H77, H83, O17, O18

Keywords:

tanah bengkok, political budget cycle, clientelism, agricultural
tenancy, electoral competition, Indonesia

Corresponding author:
Saumik Paul
Newcastle University
Newcastle upon Tyne
NE1 7RU
United Kingdom
E-mail: paulsaumik@gmail.com* The authors are grateful to Rasyad Parinduri for many helpful discussions during the initial stage of the fieldsurvey, and Hiroyoshi Kano and Hitoshi Yonekura for insightful comments on an earlier draft. The authors would
also like to thank Yutaka Arimoto, Sujata Bisaria, Pierre van der Eng, Matthias Helble, Pushkar Maitra, Peter Morgan,
Naoyuki Yoshino, seminar participants at the Hitotsubashi Summer Institute in 2018, and seminar participants at the
ADBI for their useful comments and helpful discussions. The authors would also like to thank Reiko Doi, Hiroyuki
Kuribayashi, and Yoko Oishi for their timely research assistance and Akiko Ito, Michie Kano, Yuki Matsuzaki, Makiko
Miki, Sawako Ueda and Eriko Yoshida for their excellent administrative support during the fieldwork stage. The
authors also acknowledge the efficient and helpful support from the field survey team of SurveyMETER, Yogyakarta,
Indonesia. Funding from a JSPS Grant-in-Aid for Scientific Research-A (17H02520) for providing financial support toour primary survey is acknowledged. The usual disclaimer applies.

1. Introduction

Political clientelism is generally understood as a quid pro quo exchange of citizens’ votes forbenefits from politicians (Kitschelt and Wilkinson, 2007; Hicken, 2011; Bardhan and
Mukherjee, 2020).1 The nature and size of clientelism vary across countries as they adapt todifferent levels of democracies and autocracies. While a vast literature documents thatclientelism subverts the functionality of democracy through higher levels of rent-seeking
especially in low- and middle-income countries,2 the existing knowledge is limited on how
local institutions influence the nature of clientelist exchange and the channels through whichclientelism conditions economic development.
We study the origin of clientelism and its welfare consequences in the context of aunique village institution prevalent in Java, Indonesia, where democratically elected village
heads and other officials receive usufruct rights over a piece of communal village land
(known as tanah bengkok, hereinafter, bengkok land) as compensation for their service to thevillage in lieu of salary.3 Starting from the period of Dutch colonial rule, this institution has
been in place until now because the village governance in Java is largely viewed in economic
terms and the goal has always been to keep the central budget for village administration low(Mortimer, 1974).
The feudal nature of the village government in Java continued since the colonial
period as the elected village heads often pursued economic interests like landlords. Village
elections follow a six-year cycle and the incumbent village heads utilize bengkok land until
the end of their tenure. Re-election motives and fixed-term private ownership of bengkok
land command its utilisation for amassing political support. At the same time, stiffcompetition over access to bengkok land makes patronage through the landlord-tenant
relationship an integral part of clientelist exchange (Kammen, 2003).4
In this paper, we argue that the means of clientelist exchange is shaped by strategicdelegation of agricultural tenancy contracts over bengkok land. We define and measureclientelist exchange based on the nature and frequency of tenancy contracts over time akin to
1

The other key elements of clientelist exchange are hierarchy and iteration (Hicken, 2011).
See Bardhan and Mukherjee (2000), Wantchekon (2003), Keefer (2006) and Kitschelt and Wilkinson (2007).
3
The institution of tanah bengkok was legally codified under the Dutch colonial rule, but there are disputes overits origin. According to many scholars (Moertono, 1968; Soetrisno, 1993; Tjondronegoro, 2013), an old systemof appanage land from the precolonial Javanese kingdom predates the tanah bengkok institution (see Section 2).
4
In the context of Indonesian politics, many researchers view patronage through material benefits distributed bypoliticians as a subset of clientelism broadly defined as the power relationship (Aspinall and Sukmajati, 2016).
The 1979 reform transformed the role of a village head from a mere community leader to an agent of the state(Antlov, 1994; 2004; Maurer 1994), and a broker between the state and the rural community (Aspinall, 2014).
2

2

the notion of political budget cycles (Persson and Tabellini, 2003; Brender and Drazen,2007).5
To decipher the mechanisms of clientelist exchange, we build a theoretical model inthe spirit of political budget cycles over bengkok land. In a two-period framework, the village
head acts as the landlord and hires tenants on either a fixed rental or sharecropping basis ineach period, and the election takes place after the second period. Assuming the present
quality of the land is inversely related to the level of raw material used in the past, atequilibrium the amount of raw material used increases under a fixed rental contract.6 Ourmodel predicts that an incumbent village head, driven by a re-election motive, delegates moretenancy contracts as the next village election approaches. Moreover, sharecropping contracts
are preferred over fixed rental contracts to preserve the quality of land if the incumbent
foresees higher chances of re-election.7
Fielded in 2018 across 130 Javanese villages in Central and East Java, our novel
household survey data8 is applied to test if (1) the number of the total tenancy contracts on
bengkok plots increases and (2) sharecropping as a share of total land tenancy contracts overbengkok plots increases as the election approaches. We utilise the variation in the time to theelection across villages to examine the causal link between tenancy contracts and politicalbudget cycles. The village level characteristics are highly exogenous to the time to theelection, and as such do not confound this causal channel. After controlling for plot-level,
household-level and village-level characteristics, the OLS estimates suggest that the chanceof a bengkok plot being rented out (either fixed rental or sharecropping) increases by 6
percentage points as the time of the next election becomes closer by one year, andsharecropping as the share of bengkok land tenancy contracts exhibit a U-shaped relationshipas the election approaches. These empirical results are statistically significant and remain
largely unchanged against a series of robustness checks, while placebo tests confirm that theoutcomes with bengkok plots do not hold on private plots. In addition, sharecropped bengkok

5

Political budget cycles are prevalent in less-developed countries (Shi and Svensson, 2006).
Applying a similar model, Roy and Serfes (2001) show that a fixed rental contract is always offered in the second
period whereas a sharecropping (fixed rental) contract is offered in the first period if the landlord is less (more)
myopic than the tenant.
7
In Indonesian village politics, it is a common practice to buy votes through direct cash payments to prospective
voters in the days leading up to an election. The nature of this type of vote buying is typically a once-off and does
not necessarily take the form of clientelist exchange (Aspinall, 2014; Muhtadi, 2018), which we study in thispaper.
8
We collected data at the village, household, and agricultural plot levels covering more than 1,800 households
that were sampled either from landlord or tenant populations. See Kurosaki et al. (2020) for further details.
63

plots are less productive than fixed rental bengkok plots in terms of rice yield per hectare, 9
indicating that clientelist politics over bengkok land is less efficient in terms of agricultural
productivity, at least in the short run. Overall, the role of tenancy contracts in clientelist
exchange appears robust.
The key contribution of this study lies in the creation of new knowledge on the role ofinstitutions in political clientelist exchange in the context of bengkok land in Java, Indonesia.
The three main implications of the study are as follows. Firstly, the quid pro quo nature ofclientelist exchange in the absence of monitoring leads to an enforcement problem as bothparties may not follow through on their promises (Kitschelt and Wilkinson, 2007; Robinson
and Verdier, 2003). The outcomes of this study suggest that the clientelist enforcement
problem has been historically mitigated through delegation of tenancy contracts out ofcommunal village land. To this extent, tenancy contracts over bengkok land satisfy all threecomponents of clientelist exchange proposed by Hicken (2011), contingency or reciprocity,hierarchy or unequal power between the village head and the tenants, and an iteration where
the relationship is not expected to be one-off.
Secondly, in densely populated Java, the village heads have limited opportunities tointeract with each villager. Bengkok tenants thus serve as political brokers to garner support
from voters. As the incumbent village head mobilises bengkok tenants for the purpose of reelection, the tenants serve as political brokers playing the role of intermediaries between theincumbent village head and the villagers (Bardhan and Mukherjee, 2020).
Thirdly, the outcomes on agricultural productivity suggests that clientelist politics areless efficient in the short-term, although it could be possible that the prospects of the longterm welfare gain increase through preserving the quality of land. The net welfare gain
depends on the relative strength of the short-term and long-term effects.
Our study contributes to the broad strands of literature on elite capture10 anddemocratic consolidation. It is widely documented that democratic consolidation is achieved
through clientelism and elite capture. 11 The redistributive gains from bengkok land areassociated with democratic consolidation where the village heads remain an important

9

Rice cultivation is the primary source of income from bengkok land in our study area. In some other areas,
there exist other income-generating channels out of bengkok land (e.g., sugarcane production), which areoutside the scope of this study.
10
See Nunn (2012) for a comprehensive survey on this topic.
11
See Bardhan and Mukherjee (2020, 2012, 2000); Baland and Robinson (2008); Persson and Zhuravskaya(2011); Robinson and Verdier (2002); Dal Bo and Di Tella (2003); Wantchekon (2003); Acemoglu and Robinson(2006); Dal Bo (2007); Baland and Robinson (2008); among others.

4component of the hierarchical structure of state bureaucracy (Maurer, 1994).12 The wealthiest
households in a village who have resources to contest for a village election, often become thevillage head and control their use rights over bengkok land (Booth, 2012; Mortimer, 1974).
The prize of victory in the village election is access to land (Maurer, 1994; Kammen, 2003;
Antlov, 2004), and through an iterative process of the renewal of tenancy contracts, theoutputs from cultivation of bengkok land is repeatedly shared between the tenant and thevillage head.13
Lastly, this study contributes to the field of research on the political economy ofIndonesia. Studies on the patronage and clientelism in Indonesia have largely focused onnational, provincial and district legislatures and executive elections (Aspinall and Sukmajati,
2016; Martinez-Bravo, 2014; Martinez-Bravo et al., 2017; Dell and Olken, 2020). At thesame time, attention has mostly been paid to vote-buying through non-clientelist exchange,
primarily in the form of retail vote-buying (Muhtadi, 2018). The current study provides
evidence on clientelism rooted in the use of communal land in village politics. Despite avoluminous literature on the political economy of Indonesia,14 only Lim (2019) provides asystematic empirical study of bengkok land. In two respects, our study differs from Lim(2019). Firstly, Lim (2019) examines the long-term impact of bengkok land institutions on
productivity and poverty reduction whereas we explore the relationship between land tenancy
contract choices and the political budget cycles over bengkok land. Secondly, our survey
covers 130 villages with bengkok land spread across 13 districts in Central and East Java,compared to the two districts studied by Lim (2019). The unavailability of systematic data on
bengkok land15 has bottlenecked in-depth research on this historic institution that takes thecentre stage in the political economy in Javanese villages. To the best of our knowledge, thisis the first large-scale empirical study performed on bengkok land.
Three caveats are in order, all of which are not addressed in this study due to the lackof detailed data. Firstly, clientelist politics in the present context benefits only voters-cum12

In Java, the rural areas of each province are successively divided into districts, sub-districts and villages.
Villages thus constitute the smallest unit of territorial administration in the rural area of Java.
13
The unique features of bengkok land dub the village as de jure landlord and the village head as de jure tenantof bengkok land. The village head on the other hand acts as the de facto landlord, who use her authority forpolitical manipulation and private economic gain.
14
See Fisman (2001); Olken (2009, 2006); Skoufias et al. (2014); Martinez-Bravo (2014); Martinez-Bravo et al.
(2017); Lim (2019); Alatas et al. (2019); Dell and Olken (2020), among others.
15
Scattered ethnographic studies, agricultural surveys (Antlov, 1994; Maurer, 1994; Hart, 1986; Kano, 1977;
White and Wiradi, 1979, among others) and intermittent census figures have so far been the only sources available
on bengkok land. The available resources from the Village Potential Statistics (PODES), conducted in line with
the implementations of the Population Census, Agriculture Census and Economic Census in Indonesia, do notprovide detailed information on the distribution of bengkok land among different administrators, either.

5tenants at the expenses of other voters. However, in the standard models of political budget
cycles, manipulation of fiscal aggregates (increases in deficits and expenditures or cuts intaxes) to buy votes benefits all citizens (Persson and Tabellini, 2003; Brender and Drazen,2007).16 Secondly, as we have limited data on electoral outcomes, we do not examine thedirect relationship between clientelist exchange and the electoral outcomes for tenants andlandlords involved in bengkok tenancy. Thirdly, while we explicitly model clientelist
exchange as the vote-buying strategy, a widespread practice in legislative and executive
elections at the national, provincial and district level in Indonesia is retail vote-buying
through direct cash payments to potential voters on the day of the election (Hadiz, 2010;
Aspinall and Sukmajati, 2016). Candidates sometimes also engage in pork-barrel politics,
offering publicly funded programs or small projects to targeted groups (Aspinall andRohman, 2017).
We organise the rest of the paper in the following manner. Section 2 provides a brief
history of bengkok land touching upon its origin and geographic spread and electoralcompetition for bengkok land. In section 3, we build a simple theoretical model on tenancy
contracts and political cycles in a village administrative system characterised by bengkok
land. Section 4 describes the data and discusses the empirical results, which is followed by aconcluding section.

2. The political economy of Bengkok land - A brief history

2.1. The origin and geography

While disputes remain about its origin (Moertono, 1968; Soetrisno, 1993), according to somescholars (Tjondronegoro, 2013), an old system of appanage land from the precolonial
Javanese kingdom predates the bengkok land institution, which was legally codified under
the Dutch colonial rule. In 1866, the Dutch colonial government decided to give the village
heads official land in lieu of salary, which proved to be an inexpensive and convenient meansof administration and cooperation with the local economy. In 1906, the provision for the16

The literature on political business cycles (Nordhaus, 1975; Rogoff and Sibert, 1988; Rogoff, 1990 and Persson
and Tabellini, 1990) precedes the literature on political budget cycles. Brender and Drazen (2007) argue that thelack of convincing evidence on political business cycles led researchers to shift their attention to political budget
cycles.

6

election of a village head was constituted by law, which also designated the revenue given to
the village heads and other village officials (Kano, 1994). At that time, the village heads andother village officials also enjoyed various labour services by the villagers. While labour
service practices were gradually abolished (Kano, 1994), the bengkok land system continued,
predominantly in the central and eastern parts of Java.
In the absence of systematic data, we resort to scattered ethnographic pieces ofevidence and census figures to describe the size and distribution of bengkok land in Java.
According to the 1883 colonial statistics, bengkok land occupied 13.9% of total farmland inJava excluding Batavia, Yogyakarta, Surakarta and Madura. The percentage was reduced to
5.9% in 1932 and the similar figure for the whole Java in 1932 was 6.0%.17 Looking at theabsolute size, however, the same data source shows that the farmland classified as bengkok
increased from 340,000 ha in 1882 to 360,000 ha in 1932 in Java excluding Batavia,
Yogyakarta, Surakarta and Madura. 18
Collecting information from an Indonesian Law book, Kammen (2003) reports thatbengkok land is found in the former Cirebon Residency of West Java, and in the entire regionof Central Java and East Java. Other independent research reports also support thisgeographic spread of Bengkok land, with more extensive spread of bengkok land in riverine
areas than in highland areas (Kano, 1977; Hefner, 1990; Booth and Sundrum, 1981). Kano
(1977, p.31) estimates the size of bengkok plots to be between 5 to 15% of the available
communal land in the village during the colonial era. The unequal distribution of bengkok
land was also partly due to the local customs at various places, which influenced the terms
and conditions of the reward that village heads and other village officials enjoyed against
their services (Kano, 1994).
Since independence, there have been several attempts to create a more equitable
distribution of bengkok land across Java, including reclassifying communal land as bengkok
land or even allocating funds available at the district level to purchase additional land forvillages (Soetrisno, 1993; Kurosaki, et al., 2020). Kano (1994), surveying 500 villages inJava in 1990, concludes that the percentage of bengkok land in the village land remain
virtually unchanged between 1903 and 1990. Data from PODES shows that in 2000 bengkok
land is concentrated in Central Java, Yogyakarta and East Java (Appendix 1A).

17

Data sources: Koloniaal Verslag van 1883 [Nederl. (Oost-) lndie.], Appendix P. for the 1882 value and IndischVerslag 1934 - II, Statistisch Jaaroverzicht van Nederlandsch-Indië, for the 1932 values. We appreciate the help
from Pierre van der Eng for obtaining these numbers.
18
We converted the acreage in “bouw” using 0.71 ha per bouw into the numbers in hectares.

72.2. Electoral competition over bengkok land

In both the colonial and post-colonial era, to keep the central budget for village
administration low, villages were mostly autonomous and village heads had authority to levy
various fees/taxes and could summon villagers to work on building or maintaining public
infrastructure (Antlov, 2004; Kammen, 2003). While village heads had always been electedfrom local people at least since the early 19th century (Hüsken, 1994), the position enabled
them to accumulate wealth. The main source of this wealth was bengkok land, often the mostfertile pieces of land in the village, which was of immense value in densely populated Java
(Maurer, 1994).
The access to resources allowed village heads to accumulate wealth that was passed
on to their children. At the same time, the position of power and access to bengkok land
allowed them to provide patronage to sharecroppers and farm labourers who could be
mobilised for various purposes, including winning the election. Standing for a village electionin Java is an expensive affair, and candidates must invest significant financial and politicalresources to be competitive. This may explain why, while village heads have always been
elected, electoral competition has often stayed between a small number of families with long
histories in village administration. This is true even after the introduction of the term limit in
1979. Maurer (1994), observing village elections in Java in 1990, found that many village
heads and candidates were from the fifth or sixth generation of village administrators.
Studying widespread protests during village elections in Java during the tumultuous
years of political transformations in 1997-1999, Kammen (2003) argues that the protests overvillage elections portrays the competition within the village to gain greater control overcommunity assets and collective resources. In 1998, more than 6250 village elections thatwere scheduled to be held in 1999 were postponed when Soeharto stepped down from power.
This had two immediate effects. On the one hand, a huge administration cost to meet theformal logistics including the formation of electoral committees, scheduling the election dateand selecting candidates became a sunk cost. On the other hand, selected candidates incurredconsiderable campaigning costs in the quest of becoming an elected village head.
As a predictable response, the suspension of village elections led to social andpolitical unrest, often escalating to outright violence in central Java. This is supported byappendix 1B, which shows more frequent incidents of electoral protests in regions with ahigher density of villages with substantial bengkok land. The high correlation between
8villages with bengkok land (appendix 1A) and protests over village elections (appendix 1B)
is not a mere coincidence; rather, it points to the fierce electoral competition in the village
where the prize of electoral victory was much-coveted access to bengkok land. The protests
over village elections became intensified as the proportion of bengkok plot to the size of thevillage land increased. This refers to a direct relationship between the size of bengkok landand election competition in a village. Villages with large and productive bengkok land
typically have a long list of potential candidates.19 Conversely, less fertile and smaller tracts
of bengkok land attract fewer candidates.20
During the 1980s and the 1990s there were sporadic attempts to replace the bengkok
land institution with a fixed salary for village heads. However, in most parts these were halfhearted efforts that failed to make any significant impact (Kammen, 2003). A stronger threatcame much later, in 2014, as part of the new Village Law. As part of the implementation of
the new law, the government started consolidating village funds (dana desa) to support thesalaries of village administrators (Lewis, 2015). Following the law, Government Regulation
43 was passed, which governs village assets so that village administrators will be paid fromvillage budget. The regulation made concrete suggestions to abolish the bengkok land
institution, and instead for village heads and other village officials to receive a stipulatedmonthly salary (penghasilan tetap), various allowances (tunjangan) and medical benefits(jaminan kesehatan) from the financial resources available at the subdistrict level (danaperimbangan) (Kano, 2017).
The new regulation received strong reactions from villages. Throughout the first few
months of 2015 there were a number of public demonstrations involving dozens andsometimes hundreds of village administrators from Central and East Java, who travelled tothe presidential palace in Jakarta, to retain bengkok as part of the salary of village
administrators.21 Under pressure from the villages, in June 2015, Government Regulation 47
was enacted to retain the status of bengkok land as an additional means of support for village

19

Large bengkok land is often also seen as a potential source of conflict during election. In preparation for the2019 election in 116 of villages in the Kudus district, Central Java, the police chief used the size of bengkok land
to map villages most vulnerable to conflicts (Tribun Jateng, 2019).
20
In 2019, for example there were shortages of candidates running for village head elections in a few villages
where bengkok land was considered too small. In 28 out of 216 villages in Temanggung District, Central Java, tocircumvent the rule requiring at least two candidates for the election, the main candidates enlisted their spouses
to run against them. The small size of bengkok land was cited as the reason why there was a low interest in theposition (Kedaulatan Rakyat Yogyakara, 2019; Kompas, 2019).
21
See for example, Radar Yogya (2015), Merdeka (2020) and CNN (2015).

9

administrators, over and above their paid salary.22 This clearly marked a victory for thevillages. Districts in Central and East Java issued legislation to formalise this. However,around this time, some districts decided to get rid of bengkok land.23
Village heads had sources other than bengkok land to generate income. As the chief
administrator of the village, village heads were often involved in most development projects
and welfare programs. Village heads served as state clients (Antlov, 2004) and had close
connections with the bureaucracy and officials at higher levels. These close connections
enabled some village heads to channel part of these funds for private use. In addition, fromland transactions, rental agreements, issuing building permits, registration of marriages,
divorces, birth and deaths – these routine village affairs all needed the approval and signatureof the village head against a fee. The fee for such activities varied and was often left at thediscretion of the village head, which also provided heads with an opportunity for rent
seeking. Furthermore, village heads often served outside interests by coercing villagers to sellor rent land to outsiders, often followed by the illegal sale of village property and private landof the villagers (Fauzi, 1995; Aspinall and Rohman, 2017; Ito, 2011). Under the Village Lawof 2014, which prevailed at the time of our survey, and with the large increase in the village
budget, it is not surprising that the position of village heads continues to be attractive andheavily contested.

3. Theory

We work with a village level framework combining agricultural tenancy choices andprobabilistic voting. Our model differs from the standard models of electoral competition inseveral ways. The public good in our model enters indirectly in the form of community
protection that villagers receive from the village head.24 For this reason, we do not consider
the role of tax and government budget to finance public goods and instead assume that they
are provided by the village head through resources from bengkok land. The direct benefit
22

In a number of public speeches, President Joko Widodo ensured that village heads and officials can continue tomanage bengkok land (Tempo, 2015).
23
At the time of our survey in 2018, three out of thirteen districts that were initially identified as core regions of
the bengkok land institution had just implemented district laws to abolish bengkok land (Kurosaki et al., 2020).
24This is supported by an ethnographic study that documents the emergence of another form of social cleavages
where voters equally cared for the protection of village assets when they saw an outsider, with vested interest in
the village land, was trying to take control of the village resources (Kammen, 2003). The outsiders could beanybody from private developers to a state official of a higher rank. Thus, the mobilisation of resources (accessto land in particular) created tensions within the village, as well as between the village and the outsiders.

10

from bengkok land comes in the form of private income that only a contract holder or tenant
receives. It is noteworthy to mention that our model of the political budget cycle only
concerns villages where bengkok land is available. The electoral process of selecting a village
head also exists in Javanese villages that do not possess bengkok land, and in such cases thevillage heads receive a salary instead of gaining access to bengkok land.25
Appendix 2 provides a detailed description of the theoretical model. Sections A2.1
and A2.2 provide the preliminaries. In section A2.1, we describe the model assumptions andtiming of the events. In our framework, the village head acts as a landlord who employs
tenants for two periods by offering them a contract in each period, and the election takes
place after the second period. Section A2.2 presents a modified version of the tenancy choicemodel of Roy and Serfes (2001). In a similar two-period set-up, with no uncertainty andasymmetric information of any kind, Roy and Serfes (2001) derive a tenancy contract
mechanism. Based on the assumptions that the present quality of the land is inversely related
to the level of raw material used in the past and the amount of raw material used increases as
the type of tenancy contract changes from sharecropping to fixed rental, Roy and Serfes(2001) show that a fixed rental contract is always offered in the second period whereas asharecropping (fixed rental) contract is offered in the first period if the landlord is less (more)
myopic than the tenant.26
Section A2.3 presents a simple model of electoral competition between the incumbent
and the challenger without a political cycle motive. The two parties announce their electoral
platforms before the realisation of political parameters. It characterises the decisive voter anddeterminants of the incumbent’s winning probability. Finally, in section A2.4 we introduce
the case of an incumbent village head having a strong motivation for re-election so that she
utilises any strategy of vote buying, which is central to this paper. We extend the Roy and
Serfes model to incorporate hiring of additional tenants on bengkok plots in the second
period, and the provision of village elections after the second period using a standard
probabilistic voting model. In the case of electoral competition without a vote-buying
strategy, we reach equilibrium tenancy contracts, as in Roy and Serfes (2001).

25

For example, Martinez-Bravo (2014) compared the elected and the appointed village heads to study if different
systems of selecting the village heads affect the level of incentives for district-level officials to influence thevoters.
26
Conventional wisdom on Marshallian efficiency suggests that landlords prefer fixed rental to sharecropping asa tenancy choice.

11

The role of clientelism in the village-level political budget cycle is best understood in
the case of the electoral competition with a vote-buying strategy with the help of thefollowing propositions.
Proposition 1. An increase in the number of the total tenancy contracts improves the
chances of incumbent re-election.
Proof: See section A2.4.2 (Appendix 2).
Proposition 2. New tenancy contracts as the time to an election becomes shorterare more likely to be sharecropping.
Proof: See section A2.4.2 (Appendix 2).
An opportunist incumbent village head, as derived from our theory, increases thenumber of the total tenancy contracts on bengkok land in pursuit of garnering a larger votebank for re-election. Moreover, new tenancy contracts are more likely to be sharecropping, as
opposed to the case of electoral competition with no vote-buying strategy, when the election
approaches. The second theoretical proposition is based on the premise that an opportunist
village head gives more weight to preserving the quality of land foreseeing a higher
probability of winning the election again, which makes the equilibrium contract choice to besharecropping as opposed to fixed rental as the election time becomes nearer.
Based on the above two propositions, we empirically test the following hypotheses:(H1) the number of total tenancy contracts on bengkok plots increases as the time to anelection becomes shorter, and (H2) the share of bengkok land tenancy contracts undersharecropping first decreases and then increases as the election time approaches, i.e., a Ushaped relationship between the share of sharecropping tenancy contracts and the time to theelection.
The second hypothesis integrates two mechanisms. The theory discussed in A2.2
predicts that across all bengkok plots that are rented out in period 1, the percentage ofsharecropping contracts declines in period 2, while the theory discussed in section A2.4
predicts that bengkok plots that are newly rented out in period 2 are more likely to be undersharecropping. As our empirical setting has a six year political cycle, as explained in the next
section, we expect the first mechanism to dominate when the time of the election is far away
while the second mechanism to dominate when the election approaches.

4. Empirical findings

124.1. Empirical strategy

As our dataset is cross-sectional, we cannot test these hypotheses directly. Instead, we
examine whether two measures of Y (the dummy variable for a bengkok plot under tenancy
for H1 and the dummy variable for a leased bengkok plot under sharecropping for H2) arecorrelated with X (the time till the election) as predicted by the theory. Note that the second
hypothesis is tested conditional on a bengkok plot being rented out, which is examined in thefirst hypothesis.
It is possible that village level variables that affect the tenancy choice through othermechanisms (not modelled in our theoretical model) are correlated with X but omitted fromour empirical model. In the standard tenancy theories in agricultural development economics,
type and quality of the farmland, tenants’ liquidity constraint and risk aversion, landlords’
risk aversion, relative positions of landlord-tenant wealth status and comparative advantages,
market access for output and input among others are pointed out as important correlates oftenancy choice (Otsuka, 2007). We therefore run regressions using X (and its
transformations) as the main explanatory variables, but with control variables such as
characteristics of plots and landlord or tenant households. Village-level controls will be
added in the robustness check.
Despite our finding of strong empirical support to H1 and H2 in the baseline model, it
is possible that X can capture something else due to its correlation with some unobservablevillage-level characteristics that affect tenancy choices in general. To check this possibility,
we run placebo tests using private land plots owned by private landlords, some (or all) of
which is rented out to tenants either on a fixed rental or sharecropping contract.27 For theseplots, we can calculate two dummy variables of Y’ (the dummy variable for a private plot
under tenancy and the dummy variable for a leased private plot under sharecropping). As
these plots are not directly affected by the political budget cycle, we expect no correlation
between Y’ and X, as far as X correctly captures the political factor.
Finally, we conduct several robustness checks. In addition to standard robustness
checks with respect to the specification of empirical variables and functional forms, we use
three sources of information on bengkok plots allocated to village heads. In our main27

In our dataset, some of bengkok landlords also own private farmland (Kurosaki et al., 2020). How the tenancy
management of these private plots responds to the political cycle factor is highly complicated, beyond the scopeof this paper. We thus do not use information on these private plots.

13

analysis, we use plot-level information collected from sample landlord households. As
robustness checks, we also use village-level information collected from village administratorsand plot-level information collected from sample tenant households.

4.2. Data

For the empirical analysis, we use survey data, administered in February-April 2018 in two
provinces of Central Java and East Java, where the bengkok institution is more prevalent, andboth provinces were under the same Dutch colonial rule. From government statistics, we first
selected a total of 13 rural districts (kabupaten)28 where the bengkok land institution isprevalent and the main crop is paddy, ten districts from the eastern part of Central Java andthree districts from the western part of East Java. From each district, two sub-districts(kecamatan) were selected. The selection of sub-districts was based on the farmland
characteristics. Within each district, using the most recent agricultural statistics, we excluded
sub-districts where the area of the dry farmland is larger than that of the wet farmland. From
the remaining sub-districts, we randomly selected two sub-districts. A total of 26 sub-districts
spread across 13 districts are shown in Appendix 3. A comparison with Appendix 1A
suggests that our study villages were chosen from Javanese regions with a higher frequencyof villages with substantial bengkok land.
The purpose of the survey was to collect detailed information on bengkok land at
three levels: village, household, and agricultural plot. The survey covered 130 villages andmore than 1,800 households that were sampled from both landlord and tenant populations inthe study villages. See Kurosaki et al. (2020) for details of the survey design and distributionof key variables regarding the management of bengkok land.
The main explanatory variable is X (the time to the next election). We had to exclude
three villages where the incumbent village heads were ineligible for further elections due tothe term limit. The distribution of X is shown in Figure 1. Its mean (S.D.) is 1.6 years (1.3
years) ranging from the minimum of 0.25 year (i.e., 3 months) to the maximum of 5.75 years(5 years and 9 months). Its median is 1.25 years (i.e., 1 year and 3 months).

28 In Indonesia, districts are classified into two types: kabupaten districts, which mostly prevail in rural areas andthe majority of its villages are known as desa where village heads are directly elected, and kota districts, whichmostly prevail in urban areas and the majority of its villages are known as kelurahan where village heads areappointed by the district mayor. Martinez-Bravo (2014) utilises the difference between desa and kelurahan to
identify the impact of elections in Indonesian local politics. Our survey covered desa villages in kabupaten
districts.

14

To calculate the dependent variables, we mainly use the plot-level information in thelandlord household data. This dataset contains information on 2,500 plots owned by 930
sample landlords. The sample landlords fall under one of the three exclusive categories: purebengkok landlords without any private farmland, landowning bengkok landlords and pure
private landlords (Kurosaki et al., 2020). For the main analysis, from the first two groups ofbengkok landlords in eligible villages, we exclude bengkok landlords who are not village
heads themselves. This is to identify the subset of bengkok plots that are under the direct
influence of the political cycle. We have 273 plots available for the main analysis. Twodummy variables are compiled: Y1, the dummy variable for the bengkok plot under lease(either on a fixed rental or sharecropping basis), and Y2, the dummy variable for the leased
bengkok plot under sharecropping. The mean of Y1 is 0.857 (n=273) and the mean of Y2
conditional on Y1=1 is 0.440 (n=234).
For the placebo test we employ private plots owned by pure private landlords, who
reside in villages administered by eligible village heads. We have 735 plots falling in thiscategory. The mean of Y’1 is 0.839 (n=735) and the mean of Y’2 conditional on Y’1=1 is 0.588(n=617).
As control variables, we employ plot characteristics (dummy variables for unirrigatedlowland plot, upland plot and size larger than 1ha), landlords’ characteristics (age, years ofeducation and asset index score29), tenants’ characteristics (age, years of education and asset
index score) and village characteristics (total area of the village, population to farmland ratio,
number of factories and distance to the district capital city).

4.3. Time until the next election and village characteristics
Bivariate correlation coefficients between X and ten village-level variables are shown in
Table 1. None of the ten coefficients is statistically significant at the 1% level and only one isstatistically significant at the 5% level (number of factories in the village).
Table 1 also shows the regression results with X as the dependent variable and the ten
village-level variables as explanatory variables. No variable has a statistically significant
coefficient. Furthermore, the F-test for no slopes shows the overall insignificance of the

29"Asset index score" is the predicted value of the first principal component, aggregating 13 dummy variables forthe household ownership of TV, satellite disc, refrigerator, LPG tube, air conditioner, mobile phone, computer,tablet, pump, generator, vehicle, boat and motorcycle (the loading coefficients, all positive, were estimated fromthe pooled sample of both tenant and landlord households).

15

regression model and R2 is very low. As several of the ten explanatory variables are highly
correlated, we also estimated a parsimonious version excluding mutually correlated variables(last column of Table 1), which confirms the previous result. Therefore, village-level
observables do not have explanatory power for X.
We thus conclude that our measure of X (years until the next election of the villagehead) is highly exogenous to village-level characteristics. This justifies our main specification
with plot and household characteristics and the specification with village-level controls as arobustness check.

4.4. Effect of the political cycle on tenancy choice

4.4.1 Main results

The actual values of Y are plotted on X in appendix 4A, which suggests that the probability ofa bengkok plot being rented out increases as the time of election draws nearer. As shown incolumn (1) of Table 2, the OLS regression coefficient on the linear term of X is -0.064 andstatistically significant at the 10% level even with controls at the plot and household level. As
shown in column (2) of Table 2, the coefficient on the quadratic term is insignificant. By
imposing the restriction that the quadratic coefficient is zero, the model (2) turns into themodel (1). Different combinations of control variables show that the coefficient is estimatedrobustly at around -0.06, implying that the probability increases by 6 percentage points whenthe election becomes closer by one year. Thus, H1 is supported.
As shown in appendix 4B, the probability of a leased bengkok plot undersharecropping first decreases and then increases as the time of election draws nearer (Ushaped relation). As shown in column (4) of Table 2, the quadratic model is supported against
the linear model with coefficient of -0.35 on the linear term and 0.07 on the quadratic term,
where both are statistically significant at the 5% level. Different combinations of control
variables show that the coefficients are estimated robustly at approximately -0.3 on the linear
term and 0.07 on the quadratic term. Thus, H2 is supported. Based on specification (4), theU-shape has the minimum at approximately X = 2.5 (i.e., 2 years and 6 months until the next
election). From Table 2, we notice that control variables have much larger explanatory poweron Y2 (sharecropping vs. fixed rental) than on Y1 (renting out vs. own cultivation). Thisimplies that the choice between sharecropping and fixed rental is affected not only by the16political cycle but also by standard sets of variables discussed in the land tenancy literature(Otsuka, 2007), the details of which are reported in appendix 5.
Instead of using linear and quadratic terms of X, we can characterise the time effects
using a set of dummy variables in the spirit of time fixed effects. Appendix 6 shows the fitted
effects of the time dummies on the lease probability. Similarly, appendix 7 shows the fitted
effects of the time dummies on the sharecropping probability given that the plot is leased.
Regardless of the way in which we define the time fixed effects, both H1 and H2 aresupported from these figures as well.

4.4.2. Placebo tests

If our interpretation that X (the time until the next election) represents the political factor thatis related to clientelism and specifically to bengkok plots, we do not expect to find similar
relations when we examine private plots owned by pure private landlords (those who are notallocated any bengkok land). As shown in appendix 8A, the probability of a bengkok plot
being rented out is almost flat regardless of the time until the next election. As shown incolumn (1) of Table 3, the OLS regression coefficient on the linear term of X is statisticallyinsignificant. We thus conclude that the pattern similar to H1 does not exist on private plots(placebo test has been passed).
As shown in appendix 8B, the probability of a leased bengkok plot being undersharecropping has a slightly positive slope but is not showing a U-shaped relationship. As
shown in column (3) of Table 3, the linear model has an insignificant coefficient on X. In
sharp contrast to Table 2, the quadratic model has insignificant coefficients on both linear andquadratic terms in Table 3. This is robustly supported when the list of controls is permuted.
We thus conclude that the pattern like H2 does not exist on private plots.

4.4.3. Robustness checks

We start with village level data for testing H2 (for H1, we have very little variation as theaverage of the dependent variable is very close to 1). Out of 130 villages, 11 villages were
dropped because either the village head was ineligible for re-election, or the village head had
not yet received the bengkok plots at the time of our survey, or the village head self17

cultivated all of the bengkok plots. The information is not at the plot level, so we cannot
control for plot-level characteristics. The dependent variable is a dummy variable for thevillage head to rent out some or all of bengkok plots to sharecropping, which has a mean of
0.395 (n=119).
As shown in appendix 9A, village-level data also show the U-shaped relationship.
Column (2) of Table 4 shows that the quadratic model is supported against the linear modelwith a coefficient of -0.38 on the linear term and 0.07 on the quadratic term, both of which
are statistically significant at the 1% level. Thus, H2 is supported from this alternative data
source.
We can use plot-level data collected from the tenant household survey. However,
because of the sampling design, we cannot test H1 (H1 is on plots owned by landlords, which
were, by construction, collected in the landlord household survey). On the other hand, we canstill test H2 for bengkok plots using data on rented-in plots by sample tenant households. In
the tenant household survey, we collected information on 2,652 plots managed by 913 tenanthouseholds. Out of these 2,652 plots, 724 plots were bengkok plots rented-in from village
administrators. Out of these 724 plots, we exclude those in ineligible villages and those
allocated to village officials other than the village head. As a result, we have 132 bengkok
plots, for which the average of sharecropping dummy is 0.333.
As shown in appendix 9B, tenant household data also show the U-shaped relationship,
although some irregularity occurs when the election is very close. Column (4) of Table 4shows that the quadratic model is supported against the linear model with a coefficient of 0.30 on the linear term and 0.05 on the quadratic term, both of which are statisticallysignificant at the 5% level. The coefficient estimates for these two parameters remain highly
stable when we churn the list of controls. Thus, H2 is supported from the data reported bysample tenants as well. It should be noted that about one half of these tenants’ plots overlap
with the plot-level data collected in the landlord household survey (matched tenant-landlorddata). Therefore, the analysis in columns (3) and (4) of Table 4 is not wholly independent of
the analysis in columns (3) and (4) of Table 2. Due to the small number of observations, we
do not attempt an analysis using the matched data.
Regarding different specifications, we already discussed the robustness when we
employed a different parametrisation of X using time fixed effects (appendix 6 and 7). The
results were similar when the monthly thresholds defining the year dummies were changed(i.e., whether the equality is put on the upper or lower threshold, or the treatment of large
values of X for which the number of observations is small). The results based on probit
18

specifications are highly similar to those of the OLS results (appendix 10A). The addition ofvillage-level controls did not change the results, either (appendix 10B). The robustness
against the inclusion of village-level variables is especially important as our main variable ofinterest is defined at the village level. Overall, both H1 and H2 are supported robustly.

4.5. Tenancy choice and agricultural productivity

As the last subsection on empirics, we provide some evidence on the welfare effects ofclientelist politics over bengkok land. In the literature, patterns of resource allocationconsistent with clientelism are examined to understand their implications for welfare(Bardhan et al., 2020). For instance, public expenditure on infrastructure across Indian states
is low despite a large demand for infrastructure services, which as Khemani (2015) argues,
could be because infrastructure projects are not well-suited for clientelism.
In our theoretical model of land tenancy contracts, an opportunist village head offers
sharecropping as an equilibrium contract choice in the second period as she gives moreweight to preserving the quality of land, foreseeing a higher probability of winning theelection again (the second hypothesis in the theoretical model). We test the validity of thistheoretical argument by comparing the rice yield (ton per hectare) between sharecropped andfixed rental bengkok plots. After controlling for plot-level, household-level and village-level
characteristics, we find robust and statistically significant empirical evidence thatsharecropped bengkok plots are less productive than fixed rental bengkok plots (appendix
11). This supports our theoretical construct that clientelist politics over bengkok land is lessefficient in terms of agricultural productivity.
On the other hand, clientelist politics could enhance the prospects of future welfare
gain by preserving the quality of land as our theory predicts. Tenants newly hired in the lastperiod before the election gain incomes irrespective of the type of tenancy contracts incomparison to the state without tenancy on bengkok plots. Despite an income loss in thecurrent period in comparison to the fixed rental case, sharecroppers on bengkok land canforesee an income gain in the future as the quality of land in the current period is restored.
We consider it a positive externality in the long run. However, it is beyond the scope of thisstudy to provide empirical support on how future-income prospects generate welfare gains forthe villagers. The net welfare gain depends on the relative strength of the positive andnegative externalities arising from clientelist politics associated with bengkok land.
19

To conclude, the redistributive gains from bengkok land are closely associated withclientelism and democratic consolidation at the village level. The prize of victory in thevillage election is access to land (Maurer, 1994; Kammen, 2003; Antlov, 2004; Aspinall andRohman, 2017), and the elected village heads pursue similar economic interests as landlords.
While the village head mobilises bengkok tenants for private gains, the tenants could also
serve as political brokers, and as such, play an important role in overcoming monitoring andenforcement problems (Bardhan and Mukherjee, 2020). This reciprocal relationship helps
mitigate the clientelist enforcement problem in this unique political institution.

5. Conclusion

In this study, we provide an empirical case that suggests the strategic delegation ofagricultural tenancy contracts borne out of communal village land as the means of clientelist
exchange. We achieve this in the context of the historic bengkok land institution in Java,
Indonesia, which grants usufruct rights to village heads over a parcel of village land in lieu ofsalary. A theoretical model provides the justification for linking tenancy arrangements withthe political budget cycle associated with the election of village heads. Empirical support
comes from a novel household level survey administered in 2018 across 130 Javanesevillages in Central and East Java.
This study brings out novel insights on the role of institutions in shaping the nature ofclientelist exchange. It shows how the iterative process of clientelist exchange throughagricultural tenancy contracts is linked to democratic consolidation and welfare gains for the
citizens in the short- and long-term. To this extent, a recent study by Lim (2020) finds thatsalaried village heads can generate more public goods compared to bengkok villages. One
possible explanation to this outcome could be a higher level of rent seeking in bengkok
villages.
The welfare implications of this study have direct bearings on the recent state
attempts to replace the bengkok land institution with a system of fixed salary for the village
heads. In 2014, after the new Village Law was passed, the government started consolidating
village funds to support the salaries of village administrators (Lewis, 2015). However, the
new 2014 regulation received strong opposition from the village officials, which forced
the government in June 2015 to eventually retain the status of bengkok land as a means ofsupporting them, over and above their paid salary.
20

A fruitful way to extend the current study is to understand the mechanisms of thelong-term welfare effects of clientelist exchange. From such a study, the role of clientelism ineconomic development over time can be compared across different types of politicalinstitutions.

21

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contracts’, Journal of Development Economics, 64 (2), pp.417-436.
Shi, Min and Svensson, Jakob (2006). ‘Political budget cycles: Do they differ acrosscountries and why?’ Journal of Public Economics, 90 (8-9), pp.1367–89.
Skoufias, Emmanuel, Narayan, Ambar, Dasgupta, Basab and Kaiser, Kai (2014). ‘Electoral
accountability and local government spending in Indonesia: Dataset’, Policy ResearchWorking Paper No. 6782, World Bank.
Soetrisno, Loekman (1993). The Transformation of the Function and Role of the Lurah in
Java: A Historical Perspective: 1950-1967, Yogyakarta: Penerbit Aditya Media.
Tempo (2015). ‘Jokowi: Tanah Bengkok Jadi Hak Kepala Desa’, December 28,
https://koran.tempo.co/read/berita-utama-jateng/390149/jokowi-tanah-bengkok-jadihak-kepala-desa?
Tjondronegoro, Sediono M.P. (2013). ‘An agricultural development legacy unrealized by fivepresidents 1966-2014’, Masyarakat Indonesia, 39 (2).
Tribun Jateng (2019). ‘Kapolres Kudus Sebut Desa Rawan Bisa Dilihat Dari Luasan Lahan
Bengkok - Pemetaan Jelang Pilkades’,https://jateng.tribunnews.com/2019/09/26/kapolres-kudus-sebut-desa-rawan-bisa-dilihatdari-luasan-lahan-bengkok-pemetaan-jelang-pilkades
Wantchekon, Leonard (2003). ‘Clientelism and voting behavior’, World Politics, 55, pp.399422.
White, Benjamin and Wiradi, Gunawan (1979). ‘Pola-polapenguasan Tanah di DAD cimanuk
Dulu dan Sekarang: Beberapa Catalan Sementara’, Prisma 9, September 1979, pp.47-48.

25

.4
.2
0

Density.6.8

Figure 1. Distribution of the time until the next election of the village head

0

24Time until the next election (years)

6

Note: n=127.

26

Table 1. Time until the next election and village characteristics

Summary
statistics

Village characteristics
Total land (1000 ha)
Total farmland (1000 ha)
Population (1000 persons)Population/farmland
Number of factories
Distance to bus terminal (km)Distance to post office (km)Distance to district capital city (km)Total bengkok land (ha)Bengkok/farmland
Intercept
F-stat for zero slope
p-value (Prob > F)
R-squared

Mean

Std.Dev.

0.33
0.23
4.15
21.32
1.48
6.64
3.62
20.54
28.17
0.15

0.21
0.17
2.54
12.50
1.19
7.24
2.61
12.13
28.24
0.16

Bivariate
correlation w/
X (months until
next election)
pCoeff.
value
0.086 0.338
0.120 0.179
0.021 0.813-0.067 0.456-0.178 0.046
0.053 0.556-0.002 0.987-0.001 0.988
0.126 0.158
0.117 0.189

Multiple regression (OLS) w/ X as the dependent variable
Full list of explanatory
variables

Parsimonious specification

Coeff.

Std.Error

Coeff.

-0.4421.929
0.015-0.002-0.1640.004-0.0090.001-0.008
2.373
1.335
0.86
0.571
0.069

1.361
1.987
0.095
0.018
0.104
0.018
0.047
0.010
0.010
1.812
0.535

**

Std.Error

0.353

0.572

0.0003-0.1820.005-0.007-0.0003
0.005

0.010
0.102
0.017
0.047
0.010
0.004

1.597
0.90
0.510
0.050

***

0.502

Notes: The number of observations is 127 (3 villages whose head is ineligible for re-election are excluded). Mean (Std.Dev.) of X is 1.6 years (1.3 years). Significance levelsof ** (5%) and *** (1%) appear for the regression results. In the parsimonious specification, explanatory variables that are highly correlated with another explanatory
variable (using 0.2 or -0.2 of correlation coefficient as the cut-off) are excluded.

27

Table 2. Probability of renting-out/sharecropping and the time until the next election (bengkok plots of village heads in eligible villages)

OLS regression with the dependent variable:
Dummy for the bengkok plot tobe rented-out

X (years until the next election)(1)-0.064 *(0.036)

X2
Number of observations
Mean of the dependent variable
F-stat for zero slope
p-value (Prob > F)
R-squared

273
0.857
1.03
0.414
0.065

(2)
-0.021(0.082)-0.008(0.018)
273
0.857
0.96
0.471
0.066

Dummy for the rented-out
bengkok plot to be undersharecropping
(3)
0.032
(0.054)

234
0.440
4.06
0.001
0.207

(4)
-0.350 **(0.158)0.071 **
(0.028)
234
0.440
7.53
0.000
0.278

Notes: The observations in columns (1) and (2) are bengkok plots of village heads who are eligible to run for the next elections. The observations in columns (3) and(4) are bengkok plots of eligible village heads that are rented out. Linear probability model is estimated by OLS. Village-clustered standard errors are in parenthesis,
with significance levels of * (10%), ** (5%), and *** (1%). In addition to X and X2, plot characteristics (dummy variables for unirrigated lowland plot, upland plot,
and the size larger than 1ha) and landlords’ characteristics (age, years of education, and asset index score) are also included as explanatory variables. See Appendix 5
for the full regressions results for specification (1) and (4). Full regression results for other specifications are available from the authors on request.

28

Table 3. Probability of renting-out/sharecropping and the time until the next election(placebo: private plots of private landlords in eligible villages)

OLS regression with the dependent variable:
Dummy for the plot to be rentedout

X2(2)-0.006(0.058)0.002

Number of observations
Mean of the dependent variable
F-stat for zero slope
p-value (Prob > F)
R-squared(0.010)
735
0.839
0.76
0.636
0.012

X (years until the next election)

(1)
0.008
(0.015)

735
0.839
0.85
0.547
0.012

Dummy for the rented-out plot to
be under sharecropping
(3)
0.025
(0.023)

617
0.588
10.95
0.000
0.121

(4)
0.028
(0.109)-0.001(0.018)
617
0.588
9.60
0.000
0.121

Notes: The observations in columns (1) and (2) are private plots of private landlords in the eligible villages. The observations in columns (3) and (4) are private plotsthat are rented out. Linear probability model is estimated by OLS. Village-clustered standard errors are in parenthesis, with no coefficients significant at 10% or less.
Plot characteristics (dummy variables for unirrigated lowland plot, upland plot, and the size larger than 1ha) and landlords’ characteristics (age, years of education,
and asset index score) are also included as explanatory variables. Full regression results are available from the authors on request.

29

Table 4. Probability of sharecropping and the time until the next election using different datasets

OLS regression with the dummy for the rented-out bengkok plot to beunder sharecropping as the dependent variable
Village data

X (years until the next election)

(1)

(2)

(3)

(4)

0.023
(0.042)-0.382 ***(0.134)-0.015(0.037)-0.302 **(0.144)

119
0.395
1.26
0.292
0.031

0.071 ***
(0.028)
119
0.395
4.25
0.003
0.099

132
0.333
5.89
0.000
0.131

0.053 **
(0.025)
132
0.333
7.13
0.000
0.168

X2
Number of observations
Mean of the dependent variable
F-stat for zero slope
p-value (Prob > F)
R-squared

Tenants' plot data

Notes: The observations in columns (1) and (2) are village level data excluding villages where the village heads are not eligible for the next elections, the village
heads self-cultivate the bengkok land, or the village heads have not been allocated bengkok plots at the time of the survey. The observations in column (3) and (4) arebengkok plots that are rented in by the sample tenants. Linear probability model is estimated by OLS. Robust standard errors ((1) and (2)) or village-clustered
standard errors ((3) and (4)) are in parenthesis, with significance levels of * (10%), ** (5%), and *** (1%). For (1) and (2), landlords’ characteristics (age and yearsof education) are included; for (3) and (4), plot characteristics (dummy variables for unirrigated lowland plot, upland plot, and the size larger than 1ha) and tenants’characteristics (age, years of education, and asset index score) are also included as explanatory variables. Full regression results are available from the authors onrequest.

30

Appendix 1. Locations of villages with bengkok land and village electoral protests
A. Location of villages with bengkok land

B. Locations of political unrest / electoral protests

Note: This map shows the percentage of bengkok land in the total area of each village,
averaged at the sub-district level.
Source: Drawn from the information in PODES 2000; Kammen (2003)31

Appendix 2. Theoretical modelA2.1. Model assumptions and timing of the events
The players: (1) incumbent village head, (2) the challenger in the village head election, and(3) voters including potential pool of tenants. Contract choices on bengkok land aredetermined between the tenants and the incumbent village head, who acts as the de facto
landlord of bengkok land.30
The village election takes place every other period. We denote the first period (the period
after the previous election) as 𝑡 = 1, and the second period (the period right before the next
election) as 𝑡 = 2.
The size of bengkok land is denoted as 𝐵, which is the number of plots with the sameacreage and subject to the same production technology. 𝐵 is fixed in a village. At the
beginning of 𝑡 = 1, the incumbent is allocated 𝐵 plots of bengkok land from the village.
She rents out 𝐵𝑅 plots to tenants and keeps 𝐵 − 𝐵𝑅 plots for herself to cultivate.31
The production technology of each plot is characterised by 𝑌𝑡 = 𝑞𝑡 𝑓(𝑥𝑡 ), where 𝑌𝑡 is thegross value of the output, 𝑞𝑡 is the quality of land, 𝑓(𝑥𝑡 ) is a per plot production functionthat satisfies 𝑓(0) = 0, 𝑓′(. ) > 0 and 𝑓′′(. ) < 0, and 𝑥𝑡 is the amount of production
inputs (fertilisers, pesticides, casual labour, etc.) whose price is exogenously given by 𝑤
̅.
The quality of land in period 𝑡 = 1, 𝑞1 , is exogenously given. In contrast, the quality ofland in period 𝑡 = 2, 𝑞2 , depends on the level of input used in period 𝑡 = 1, i.e., 𝑞2 =𝑞2 (𝑥1). The quality of land deteriorates with the amount of raw materials used, but at anincreasing rate so that 𝑞′(. ) < 0 and 𝑞′′(. ) < 0 . We assume no role of asymmetric
information of any kind. As a result, the tenant’s effort level does not play any role in ourmodel.
Each tenancy contract decision is taken either over two periods, or over one period. The
subjective intertemporal discount factor for the tenant and the incumbent village head(bengkok landlord) are denoted as 𝛿𝑇 and 𝛿𝐼 , respectively, which are fixed for each agent
but may vary across different agents (0 < 𝛿𝑇 , 𝛿𝐼 < 1). When 𝛿𝑇 > 𝛿𝐼 holds, it implies thatthe tenant voter cares about the future more than the incumbent village head, but the
opposite may hold as well.

30

Bengkok land is owned by the village. Therefore, the village is the de jure landlord and the incumbent village
head is the de jure tenant. However, as it is legal and common for village administrators to rent out bengkok
land to others, which is subletting in the strict sense, we call this arrangement as the land rental arrangement andcall the incumbent the de facto landlord of the bengkok land.
31
As is similar for private land transactions, when the new village head obtains several bengkok plots, it isnatural for her to keep a portion of them for self-cultivation to assess the quality of new land. As simplificationof this, we assume that she allocates an exogenously fixed portion of bengkok plots for this purpose in period 1.
Endogenising BR is left for future research.

32

The electoral platform consists of indirect benefits outside bengkok transactions andtenancy contract offers on bengkok plots. Let us denote the fraction of total output
attributable to the tenant as 𝑠𝑡 , and the lumpsum amount of rent payment to the bengkok
landlord as 𝑟𝑡 . Due to institutional constraints, st cannot be larger than 1 and cannot be
negative. 𝑠𝑡 = 1 implies a fixed rental contract, and 0 < 𝑠𝑡 < 1 implies a sharecropping
contract. Each contract is renewed annually but for the incumbent, she can announce at the
beginning of 𝑡 = 1, her electoral platform, which includes a set of all possible tenancy
contracts for both periods (𝑠1 , 𝑟1 , 𝑠2 , 𝑟2) and hires tenants.
At the beginning of period 𝑡 = 2, the incumbent updates her suitability as the village head
and the probability of re-election. Based on this, she decides whether to contest in theelection or not. If she decides not to contest in the election, then she maintains her electoral
platform as announced at the beginning of period 𝑡 = 1 without any change. If she decides
to contest the election, then she amends her electoral platform by renting out some or all
her own-cultivated bengkok plots, 𝐵 − 𝐵𝑅 , as a vote-buying strategy.
At the beginning of period 𝑡 = 2, the incumbent and the challenger simultaneously andnon-cooperatively announce their electoral platforms (in case of the incumbent, thebengkok tenancy portion has already been announced so that she additionally announces
indirect benefits outside bengkok transactions). At this moment, the candidates know the
distributions of political support parameters, but not their realised values. At the end of
period 𝑡 = 2, the actual values of political parameters are realised. The village election
takes place and the winner is decided.

A2.2. Tenancy choice and discount factors
The structure of the equilibrium tenancy choice conditions closely follows the model of Roy
and Serfes (2001). For simplicity, we start with the case in which the discount factor ishomogeneous among the potential tenants so that the landlord offers a single set of contracts
to the homogenous tenants. Heterogeneity in the discount factor is introduced at the end of thissubsection.
A2.2.1. Intertemporal preference of the tenant
At the beginning of period 𝑡 = 2, the optimisation problem for a representative tenant voter
becomes:𝑚𝑎𝑥
𝐵̅𝑥2 − 𝑟2,𝑥2 𝜋2 = 𝑠2 𝑞2 (𝑥1 )𝑓(𝑥2 ) − 𝑤(A1)

where 𝑤
̅ are the constant unit prices of the raw materials. Let 𝑥2 ∗ be the solution to equation
A1. Given this outcome, the tenant voter maximises the optimisation problem over two periods,
which at the beginning of period 1 looks as:
33

𝑚𝑎𝑥
𝐵
̅𝑥1 − 𝑟1 ] + 𝛿𝑇 [𝑠2 𝑞2(𝑥1 )𝑓(𝑥2∗ ) − 𝑤
̅𝑥2 − 𝑟2 ]𝑥1 𝜋1 = [𝑠1 𝑞1 𝑓(𝑥1) − 𝑤(A2)

Consider 𝑥1 ∗ be the solution to equation A2.

A2.2.2. Intertemporal preference of the landlord (incumbent village head)
Given the full information about potential tenants, the incumbent village head solves thefollowing problem for the optimal contract offer for one candidate of the tenants:
𝑚𝑎𝑥
∗
∗
∗
(𝑠1 , 𝑟1 , 𝑠2 , 𝑟2 ) 𝜋 = (1 − 𝑠1 )𝑞1 𝑓(𝑥1 ) + 𝑟1 + 𝛿𝐼 [(1 − 𝑠2 )𝑞2 (𝑥1 )𝑓(𝑥2 ) + 𝑟2 ](A3)̅
subject to (i) 𝑠1 𝑞1 𝑓(𝑥1 ∗ ) − 𝑤
̅𝑥1 ∗ − 𝑟1 ≥ 𝑈∗∗)∗
̅and (ii) 𝑠2 𝑞2 (𝑥1 )𝑓(𝑥2 − 𝑤
̅𝑥2 − 𝑟2 ≥ 𝑈
The participatory constraints are separately defined for both periods as there is a possibility ofcontract renewal or the tenant running away at the beginning of period 2.
The incumbent village head cares about the quality of land so that the payoff from bengkok
land is maximised over two periods. The re-election concerns take the central stage after period̅ represents the reservation utility of the tenant𝑡 = 1, which we discuss later. In equation A3, 𝑈
if he does not work on bengkok land.
As shown by Roy and Serfes (2001) who use a similar mathematical model of 2-period tenancy
choice, our model also predicts that
A. Sharecropping contract is offered in period 1 if 𝛿𝑇 < 𝛿𝐼 .
B. Fixed rental contract is offered in period 1 if 𝛿𝑇 ≥ 𝛿𝐼 .
C. Fixed rental contract is always offered in period 2.
Unlike the setting adopted by Roy and Serfes (2001), whose model is for a single pair oflandlord-tenant, our setting has a pool of potential tenants from which the incumbent employs
her tenant(s). In period 1, the incumbent employs BR tenants and in period 2, she additionallyemploys tenants up to B-BR. We now discuss how matching is realised with equilibrium
contract parameters.
Regardless of the type of the tenant, the first-order conditions (FOCs) for his optimal
production decision are given by𝑠2 𝑞2 (𝑥1 )𝑓′(𝑥2) = 𝑤
̅

(A4)

and
34

𝑠1 𝑞1 𝑓(𝑥1) = 𝑤
̅ − 𝛿𝑇 𝑠2 𝑞2′(𝑥1)𝑓(𝑥2 )(A5)As these FOCs do not depend on fixed rent parameters, r1 and r2, the incumbent chooses theirlevels to satisfy the participation constraint as equality, leaving the tenant at his reservation
utility level. Therefore, in equilibrium, we will have̅
𝑠1 𝑞1 𝑓(𝑥1) − 𝑤
̅𝑥1 − 𝑟1 = 𝑈(A6)

̅𝑠2 𝑞2 (𝑥1 )𝑓(𝑥2) − 𝑤
̅𝑥2 − 𝑟2 = 𝑈

(A7)

and

We now assume that the potential tenant-cum-voters belong to one of the two types withdifferent levels of discount factor, 𝛿𝑇 𝐿 < 𝛿𝐼 < 𝛿𝑇 𝐻 (superscript L corresponds to a lowdiscount-factor tenant and superscript H corresponds to a high-discount-factor tenant). We
assume that the per-period reservation utility is the same for the two types. Given theseassumptions, we characterise the FOCs separately for the two types.
Case 1. 𝜹𝑻 𝑳 < 𝜹𝑰 (tenants are more myopic than the incumbent village head)In this case, the optimal contract is sharecropping in period 1 (0 < 𝑠1 ∗𝐿 <1) and fixed rental inperiod 2 (𝑠2 ∗𝐿 = 1). Adding these to tenants’ FOCs appended with the landlord’s FOC for the
optimal 𝑠1 , the resulting equilibrium is characterised by:𝑠1 ∗𝐿 =

̅ − 𝛿𝑇 𝐿 𝑞2 ′(𝑥1 ∗𝐿 )𝑓(𝑥2 ∗𝐿 )𝑤

̅ − 𝛿𝐼𝐿 𝑞2 ′(𝑥1 ∗𝐿 )𝑓(𝑥2 ∗𝐿 )𝑤
∗𝐿̅
𝑟1 = 𝑠1 ∗𝐿 𝑞1 𝑓(𝑥1 ∗𝐿 ) − 𝑤
̅𝑥1 ∗𝐿 − 𝑈
∗𝐿
∗𝐿
∗𝐿 )
∗𝐿
̅
𝑟2 = 𝑞2 (𝑥1 )𝑓(𝑥2 − 𝑤
̅𝑥2 − 𝑈𝑞2 (𝑥1∗𝐿 ) 𝑓′(𝑥2 ∗𝐿 ) = 𝑤
̅∗𝐿∗𝐿
𝑠1 𝑞1 𝑓′(𝑥1 ) = 𝑤
̅ − 𝛿𝑇 𝐿 𝑞2 ′(𝑥1 ∗𝐿 )𝑓(𝑥2 ∗𝐿 )

(A8)
(A6’)
(A7’)
(A4’)
(A5’)

Solving these five equations for five unknowns of 𝑠1 ∗𝐿 , 𝑥1 ∗𝐿 , 𝑥2∗𝐿 , 𝑟1 ∗𝐿 , and 𝑟2 ∗𝐿 , wecompletely characterise the contract and the resulting production on this bengkok plot (𝑠2 ∗𝐿 =1).

Case 2. 𝜹𝑰 < 𝜹𝑻 𝑯 (tenants are less myopic than the incumbent village head)In this case, the optimal contract is fixed rental in both periods (𝑠1 ∗𝐻 = 𝑠2 ∗𝐻 = 1). Adding
these to tenants’ FOCs, the resulting equilibrium is characterised by:̅𝑟1 ∗𝐻 = 𝑞1 𝑓(𝑥1∗𝐻 ) − 𝑤
̅𝑥1 ∗𝐻 − 𝑈̅𝑟2 ∗𝐻 = 𝑞2 (𝑥1 ∗𝐻 )𝑓(𝑥2 ∗𝐻 ) − 𝑤
̅𝑥2 ∗𝐻 − 𝑈
𝑞2 (𝑥1∗𝐻 ) 𝑓′(𝑥2 ∗𝐻 ) = 𝑤̅𝐻∗𝐻
𝑞1 𝑓′(𝑥1 ) = 𝑤
̅ − 𝛿𝑇 𝑞2′(𝑥1∗𝐻 )𝑓(𝑥2∗𝐻 )(A6’’)(A7’’)(A4’’)(A5’’)
35

Solving these four equations for four unknowns of 𝑥1 ∗𝐻 , 𝑥2∗𝐻 , 𝑟1 ∗𝐻 , and 𝑟2 ∗𝐻 , we completely
characterise the contract and the resulting production on this bengkok plot (𝑠1 ∗𝐻 = 𝑠2 ∗𝐻 = 1).

Benchmark case of first-best resource allocation
As the benchmark case to compare the two cases above, it is informative to analyse the casefor 𝛿𝑇 𝐿 = 𝛿𝐼 = 𝛿𝑇 𝐻 . We can think of this as the case when the incumbent’s time preference isthe same as the tenant’s or the case where the incumbent self-cultivates the bengkok plot withthe same production technology (which we assume away in our setting). The optimisation
problem is simplified as𝑚𝑎𝑥
𝑥1 , 𝑥2

𝑞1 𝑓(𝑥1 ) − 𝑤
̅𝑥1 + 𝛿𝐼 (𝑞2 (𝑥1)𝑓(𝑥2 ) − 𝑤
̅𝑥2 )

(A9)

whose FOCs are:̅
𝑟1 ∗∗ = 𝑞1 𝑓(𝑥1∗∗ ) − 𝑤
̅𝑥1 ∗∗ − 𝑈
∗∗
∗∗
∗∗ )
̅
𝑟2 = 𝑞2 (𝑥1 )𝑓(𝑥2 − 𝑤
̅𝑥2 ∗∗ − 𝑈∗∗∗∗ )𝑞2 (𝑥1 ) 𝑓′(𝑥2 = 𝑤̅∗∗
𝑞1 𝑓′(𝑥1 ) = 𝑤
̅ − 𝛿𝐼 𝑞2 ′(𝑥1 ∗∗ )𝑓(𝑥2 ∗∗ )(A6’’’)(A7’’’)(A4’’’)(A5’’’)

By solving these four equations for four unknowns of 𝑥1 ∗∗, 𝑥2∗∗ , 𝑟1 ∗∗ , and 𝑟2 ∗∗ , this completely
characterises the contract and the resulting production if the bengkok plot is managed in themost efficient manner from the viewpoint of the incumbent.
As this is the first best and the tenant always received his reservation utility U, any deviationfrom (A4’’’) and (A5’’’) involves efficiency loss to the incumbent in the form of reduced
income in r1 and r2. Intuitively, when the tenant is more myopic than the incumbent, theefficiency loss occurs due to the necessity of adopting sharecropping (which reduces
production incentive) for the purpose of land quality conservation; when the tenant is lessmyopic than the incumbent, the efficiency loss occurs due to the institutional constraint thatthe share parameter cannot exceed 1 (see Roy and Serfes, 2001).
𝑑𝑥

𝑑𝑥

1

2

The above results hold when 𝑑𝑠 1 > 0 and 𝑑𝑠2 > 0, i.e., the amount of raw material use increases
as the type of tenancy contract changes from sharecropping to fixed rental (Roy and Serfes,2001). Thus, the solution set for the village head’s problem consists of one of the following
equilibrium possibilities. Denoting the optimal contract by (s1*, r1*, s2*, r2*), we obtain (s1*, r1*,
1, r2*) if 𝛿𝑇 𝐿 < 𝛿𝐼 . This is because the tenant cares less for the future compared to the landlord
and is likely to use more raw materials to make a higher profit in period 𝑡 = 1. To avoid afaster deterioration of the land quality, the landlord offers a sharecropping contract in period 1,
which provides the tenant with less incentive for more raw material use. If 𝛿𝑇 = 𝛿𝐼 , the tenant
and the landlord equally care for the future so that there is no conflict of interest. By offering
36

the full production incentive to the tenant by offering a fixed rental contract (1, r1*, 1, r2*),
production efficiency is achieved. Finally, if 𝛿𝐼 < 𝛿𝑇 𝐻 , production efficiency would require s
greater than 1, which is assumed away in our model, as in the standard literature on landtenancy (Otsuka, 2007). Due to this institutional constraint, the tenant is offered a fixed rental
contract (s=1) in both periods (1, r1*, 1, r2*). The point is that the landlord provides a fixedrental contract by giving the tenant additional incentive to use more raw materials and produce
more.
When the pool of potential tenants is heterogeneous in terms of the discount factor, and theincumbent has perfect information on it, it is possible that the incumbent employs both typesof tenants at the beginning of period 1. Myopic (𝛿𝑇 < 𝛿𝐼 ) tenants are offered a sharecropping
contract for period 1 followed by a fixed rental contract in period 2, while patient (𝛿𝑇 > 𝛿𝐼 )tenants are offered a fixed rental contract in both periods. See section A2.4.1 below for the full
discussion. With the uncertainty about re-election, to maximise income from bengkok plots,
the village head-cum-landlord offers a fixed-rental contract in period 2 to ensure maximum
gain in the last period.

A2.3. Electoral competition without a vote-buying strategy
In the spirit of Downsian electoral competition, we consider two candidates to contest in theelection: the incumbent village head (𝐼) and a challenger (𝐶). In this section, we assume thatthe incumbent village head does not have a very strong motivation for re-election so that she
does not go for the vote-buying strategy, which prompts her not to offer any adjustment totenancy contracts with those tenants who were employed in period 1 and not to search for
additional tenants on bengkok land she self-cultivates in period 1. We denote electoral
platforms for the incumbent and challenger as 𝑃𝐼 and 𝑃𝐶 , respectively. For the incumbent
village head, the electoral platform consists of an equilibrium level of tenancy contracts andadditional announcement of other transfers out of non-bengkok transactions. The challenger
promises competitive tenancy contracts and other transfers that are equivalent to the proposed
platform of the village head. The electoral platforms become a vector of tenancy contract
choices. Both the incumbent village head and the challenger also offer indirect benefits to thevillagers, which could be thought as public goods (e.g., law and order, or security in the village)that benefit non-tenant voters.

A2.3.1. Preferences of the voters
Now let us assume that there are two groups of voters, who are distinguished by different
discount factors. The first group of voters has a lower discount factor than that of theincumbent, and the second group of voters has a higher discount factor than that of theincumbent. Each group consists of potential and actual tenants, who are employed at the37

beginning of period 1. Based on the results of equilibrium tenant contracts as discussed in
section A2.2, tenancy contracts for voters in the first group are likely to be (s1*L, r1*L, 1, r2*L),with 0<s1*L<1, whereas those for the second group of voters are (1, r1*H, 1, r2*H), where
superscript L corresponds to a low-discount-factor tenant and superscript H corresponds to ahigh-discount-factor tenant.
The voter 𝑖 in the group 𝑘 draws utility from electoral platforms announced by both candidates,and she votes for the incumbent village head if
𝑈𝑖𝑘 (𝑃𝐼 ) > 𝑈𝑖𝑘 (𝑃𝐶 ) + 𝛷𝑖𝑘 + 𝛾,

(A10)where 𝛷𝑖𝑘 measures voter 𝑖’s ideological bias towards the challenger. If 𝛷𝑖𝑘 > 0, then the voter
prefers to elect the challenger. Following the standard treatment of the probabilistic voting
model, we further assume that 𝛷𝑖𝑘 follows a uniform distribution on [

1
−2𝛽𝑘

,

1
2𝛽𝑘

], with density

𝛽𝑘 in the kth group of voters. On the other hand, 𝛾 measures the relative popularity of the1

1challenger, which also follows a uniform distribution on [−2𝜃 , 2𝜃 ], with density 𝜃. The valueof 𝛾 increases as the popularity of the challenger increases relative to that of the incumbent.

A2.3.2. Equilibrium
As the final step, we show the voting equilibrium based on a standard probabilistic voting
model. Let 𝛼1 be the share of voters in group 1. We define the swing voters in group 𝑘 (= 1, 2)
based on equation A10. Swing voters are indifferent between the two candidates after electoral
platforms are announced, i.e.,𝛷𝑘 = 𝑈𝑖𝑘 (𝑃𝐼 ) − 𝑈𝑖𝑘 (𝑃𝐶 ) − 𝛾(A11)Equation A11 suggests that all voters 𝑖 in group k vote for the incumbent candidate if 𝛷𝑖𝑘 ≤𝛷𝑘 . Then the vote share for the incumbent becomes∆𝐼 = 𝑝𝑟𝑜𝑏 (𝛷𝑖𝑘 ≤ 𝛷𝑘 )(A12)

Using the distribution of 𝛷𝑖𝑘 , we derive the vote share as
1∆𝐼 = + 𝛼1 𝛽1 𝛷1 + (1 − 𝛼1 )𝛽2 𝛷2
2

(A13)

In equation A13, the vote share for the incumbent village head is a random variable because
𝛷𝑘 depends on the realised value of 𝛾.
From equation A13, the probability of incumbent win can be calculated. We write1

𝑃𝐼 = 𝑃𝑟𝑜𝑏 (∆𝐼 ≥ 2)
= 𝑃𝑟𝑜𝑏(𝛼1 𝛽1 𝛷1 + (1 − 𝛼1 )𝛽2 𝛷2 ≥ 0)38

= 𝑃𝑟𝑜𝑏 [𝛼1𝛽1 {𝑈1 (𝑃𝐼 ) − 𝑈1 (𝑃𝐶 )} + (1 − 𝛼1 )𝛽2 {𝑈 2 (𝑃𝐼 ) − 𝑈 2 (𝑃𝐶 )} ≥ 𝛾{𝛼1 𝛽1 +(1 − 𝛼1 )𝛽2 }](A14)Using the distribution of 𝛾, we can write1𝜃

𝜋𝐼 = 2 + 𝛼 𝛽1 +(1−𝛼 )𝛽2 [𝛼1 𝛽1 {𝑈1(𝑃𝐼 ) − 𝑈1 (𝑃𝐶 )} + (1 − 𝛼1 )𝛽2 {𝑈 2(𝑃𝐼 ) − 𝑈 2 (𝑃𝐶 )}].
1

1

(A15)
To conclude, if the incumbent village head does not pursue a strong re-election motive, thenher electoral platform follows the equilibrium tenancy contract choices as discussed in section
A2.2.

A2.4. Electoral competition with a vote-buying strategy by the incumbent
We now assume that the incumbent village head has a strong motivation for re-election so that
she utilises any strategy to buy votes. In a land-scarce economy of Java (see Section 2),
providing access to farmland through bengkok land tenancy can function as one of suchstrategies. Therefore, at the beginning of period 2, she amends her electoral platform by renting
out some or all her own-cultivated bengkok plots, 𝐵 − 𝐵𝑅 , over a two-period contract as a votebuying strategy. The new tenants could be from either group of voters. The new two-period
contracts in the form of either sharecropping or fixed rental give an immediate access tobengkok land in period 2 (which is already under the control of the incumbent) and a promised
access to bengkok land in the period after the re-election. The electoral platforms are updated
accordingly, where (s2*new, r2*new) enters in the vector of tenancy contract choices in period 2
as a component of the incumbent’s electoral platform.
We further assume that 𝛾, which measures the relative popularity of the challenger, now
1𝑑𝛾

becomes a function of the total number of tenants, 𝑇, such as 𝛾 = 𝑇, where 𝑑𝑇 < 0. This implies
an increase in the number of tenants hired on bengkok plots lowers the relative popularity of
the challenger. The role of bengkok tenants as the brokers/intermediaries is reflected in thisassumption. We rewrite equation (A10) as
𝑈𝑖𝑘 (𝑃𝐼 ) > 𝑈𝑖𝑘 (𝑃𝐶 ) + 𝛷𝑖𝑘 + 𝛾(𝑇),(A10’)

where 𝛾 is replaced by 𝛾(𝑇). The rest of the calculation to find the probability of an incumbent
win remains the same, and we rewrite equation A15 after replacing 𝜃 with 𝑓(𝛾), both represent
11

the density of the uniform distribution 𝛾 on [−2𝜃 , 2𝜃 ].
1

𝑓(𝛾)

2

𝛼1 𝛽1 +(1−𝛼1 )𝛽2𝜋𝐼 = +[𝛼1 𝛽1 {𝑈1(𝑃𝐼 ) − 𝑈1 (𝑃𝐶 )} + (1 − 𝛼1 )𝛽2 {𝑈 2(𝑃𝐼 ) − 𝑈 2 (𝑃𝐶 )}].
(A15’)

39

A2.4.1. A note on the selection of tenants in period 1
In period 1, the incumbent hires BR tenants out of a pool of potential tenant-cum-voters, which
consists of two groups with (1) a high discount factor (𝛿𝐼 < 𝛿𝑇 𝐻 ) and (2) a low discount factor(𝛿𝑇 𝐿 < 𝛿𝐼 ), and the incumbent village head has perfect knowledge about it. Both groups ofvoters include ideologically biased (to the landlord) voters and the size of their share is not acommon knowledge to the landlord. For this reason, driven by the re-election motive, theincumbent village head randomly hires tenants from both groups. This conclusion can also bereached if we assume that the relative size of deviation of 𝛿𝑇 𝐿 (𝛿𝑇 𝐻 ) from 𝛿𝐼 is such that theefficiency loss is approximately comparable so that the incumbent is indifferent between
myopic and patient tenants from the viewpoint of maximising rent income. In this case as well,
she randomly employs myopic and patient types, resulting in the replication of population
shares of these two types among those who are employed as tenants.

A2.4.2. Tenancy contracts, incumbent-re-election and sharecropping
Proposition 1. An increase in the number of the total tenancy contracts improves the
chances of incumbent re-election.
1

Proof. Since 𝛾 = 𝑇 , applying the rule of transformation of variables following uniform
𝑑𝛾

𝑓(𝛾)

distribution, we can write 𝑓(𝑇) = 𝑓(𝛾(𝑇)) |𝑑𝑇|, or 𝑓(𝑇) = 𝑇2 . Replacing the expression of𝑑𝜋𝑓(𝛾) as 𝑓(𝑇) 𝑇 2 in equation A15’, it can be easily shown that 𝑑𝑇𝐼 > 0.

Proposition 2. New tenancy contracts as the time to an election becomes shorter are more
likely to be sharecropping.
Proof: In period 2, the incumbent employs additional tenants as many as B-BR out of the poolof potential tenant-cum-voters who are not employed in period 1. Given our assumption of thepositive impact of hiring a tenant on the incumbent’s popularity, she employs fully, i.e., asmany as B-BR tenants are employed at the beginning of period 2. The incumbent offers a similar
2-period contract, with the second period (period 3) comes after the election. As the incumbent
has a strong re-election motive, her effective discount factor between period 2 and period 3 isclose to the value as before ( 𝛿𝐼 ). However, from the viewpoint of potential tenants, thesubjective probability of re-election is likely to be less than 1 (0 < k < 1). Therefore, when theincumbent village head offers a 2-period contract at the beginning of period 2, she needs to use
the tenant’s effective discount factor between period 2 and period 3 calculated as 𝑘𝛿𝑇 . In aclosely-knit society of Javanese villages, we can assume that the incumbent can obtain somegood estimate for k when she contacts a potential tenant and finalises the contract. If the newly
employed tenant’s effective discount factor satisfies 𝑘𝛿𝑇 < 𝛿𝐼 , he will be offered a40

sharecropping contract for the first period (period 2). Therefore, with this adjustment for k, thepercentage of sharecropping on total bengkok plots including that are rented out from period 2
is likely to be higher than the percentage of sharecropping on total bengkok plots that are rented
out from period 1.
The adjustment parameter k may differ from tenant to tenant. Even if the newly employedtenant’s innate discount factor is larger than that of the landlord, she will be offered asharecropping contract if her k is sufficiently small. When two potential tenants of type L andH compete for a bengkok plot, the incumbent will find the H type more attractive in terms ofrent income receipt if k is the same, but she will find the L type more attractive if k for the H
type is much smaller than k for the L type. Therefore, newly employed tenants in period 2 caninclude both L and H types, like the case in period 1.
The intuition is that the subjective probability of re-election from the viewpoint of theadditional tenants is surely less than 1. The potential tenant, when offered a 2-period contract
at the beginning of period 2, discounts the payoff in period 3 by the factor of his own discountfactor further discounted by the re-election probability. As an extreme case, the new contract
may be regarded essentially as lasting for one year from the viewpoint of the new tenant.
Logically, the tenants attempt to maximise their profit from bengkok plots by extensive use of
raw materials. Due to tenant’s myopic behaviour and an extremely low discount factor, thevillage head will only offer sharecropping contracts independent of the initial discount factor
that the tenants were characterised by.
It is interesting to note that in our model, patient tenant-cum-voters are offered a fixed rental
contract if they are hired in period 1 but the same type of tenants could receive a sharecropping
contract in the first cropping season if they are hired in the beginning of period 2. The differencein the outcome is driven purely by the incumbent village head’s re-election motive, whichfurther discounts the tenant’s payoff in period 3 (after re-election) as they consider the
subjective probability of re-election of the incumbent to be less than unity.
Last but not the least, as the election approaches, our theory predicts that the percentage ofsharecroppers increases but it does not preclude the possibility of having new fixed rental
contracts at the beginning of period 2. Such cases may arise when potential tenants of type H
with a high adjustment parameter k compete for the access to bengkok plots.

41

Appendix 3. Districts and sub-districts of the study areas

Note: The light brown segments show our sample sub-districts and the light green segments
surrounding them show the districts to which our sample sub-districts belong.
Source: SurveyMETER.

42

Appendix 4. Probability of renting-out/sharecropping and the time until the next
election (bengkok plots of village heads in eligible villages)

A. Renting out of the bengkok plot (n=273).

B. Sharecropping, given renting-out (n=234)
Notes: Plots show raw observations. The red curve shows fitted values from a locally weighted regression(LOWESS).

43

Appendix 5. Full regression results with plot and landlord household characteristics

Multiple regression (OLS) with the dependent variable:
Dummy for the bengkok
plot to be rented-out

Dummy for the rented-out
bengkok plot to be undersharecropping

Coeff.
Std.Error
Coeff.
Explanatory variables
Key variables of political cycle
X (years until the next election)-0.064 *0.036-0.3502
X
0.071
Plot characteristics (reference category = irrigated lowland plot whose size is 1haor less)
Dummy for unirrigated lowland plot
-0.0570.053-0.139Dummy for upland plot
-0.0130.094-0.052
Dummy for the size larger than 1ha-0.0290.052-0.210Landlord household characteristics (standardised variables)
Age of the household head
-0.0220.026
0.124
Years of education of the hh head
0.012
0.030
0.087
Asset index score-0.0420.031-0.087
Intercept
0.991 ***
0.059
0.833
Number of observations
273
234
Mean of the dependent variable
0.480
0.440
F-stat for zero slope
1.03
7.53
p-value (Prob > F)
0.414
0.000
R-squared
0.065
0.278

Std.Error
**
**

0.158
0.028

**

0.137
0.192
0.104

**
**
***

0.057
0.062
0.040
0.133

Notes: The observations in columns (1) and (2) are bengkok plots of village heads who are eligible to run for the
next elections. The observations in columns (3) and (4) are bengkok plots of eligible village heads that arerented out. Linear probability models are estimated by OLS. Significance levels of * (10%), ** (5%), and ***(1%), based on the village-clustered standard errors.

44

Appendix 6. Fitted effects of the time until the next election on rental probability(bengkok plots of village heads in eligible villages)

0.3
0.2
0.1
0
-0.1

time_rem1 time_rem2 time_rem3 time_rem4 time_rem5

-0.2
-0.3
-0.4
-0.5

(Annual fixed effects)
0.3
0.2
0.1
0
-0.1

time_Q1

time_Q2

time_Q3

time_Q4

time_Q5

-0.2

-0.3
-0.4
-0.5

(Quintile fixed effects)
Notes: n=273. The 95% confidence intervals are shown by whiskers. “Annual fixed effects” werecreated as: time_rem1 for X < 1, time_rem2 for 1  X < 2, time_rem3 for 2  X < 3, time_rem4 for 3 
X < 4, and time_rem5 for 4  X, while time_rem represents time remaining (in years) before the next
election. “Quintile fixed effects” were created from quintile dummy variables constructed fromtime_rem variable, which is a continuous variable. In the regression analysis, we used the mid-category
as the reference and the same plot-level and household-level controls were included, which are listed in
the footnote to Table 2.

45

Appendix 7. Fitted effects of the time until the next election on sharecropping
probability (rented-out bengkok plots of village heads in eligible villages)

1
0.8
0.6
0.4
0.2
0

time_rem1 time_rem2 time_rem3 time_rem4 time_rem5
-0.2

-0.4

(Annual fixed effects)
1
0.8

0.6
0.4

0.2
0

-0.2

time_Q1

time_Q2

time_Q3

time_Q4

time_Q5-0.4(Quintile fixed effects)
Notes: n=234. See notes to Appendix 6 for other details.

46

Appendix 8. Probability of renting-out/sharecropping and the time until the next
election (placebo: private plots of pure private landlords in eligible villages)

A. Renting out of the private plot (n=735).

B. Sharecropping, given renting-out (n=617)
Notes: Plots show raw observations. The red curve shows fitted values from a locally weighted regression(LOWESS).

47

Appendix 9. Probability of sharecropping out and the time until the next election(different datasets)

A. Sharecropping, given renting-out, village-level administrators’ data (n=119).

B. Sharecropping, given renting-out, tenants’ plot data (n=132)
Notes: Plots show raw observations. The red curve shows fitted values from a locally weighted regression(LOWESS).

48

Appendix 10. Robustness checks of the main result(bengkok plots of village heads in eligible villages)

Dependent variable:
Dummy for the bengkok plot
to be rented-out(1)
A. Probit regression
X (years until the next election)-0.253 **(0.113)

Dummy for the rented-out
bengkok plot to be undersharecropping

(2)

(3)

(4)

-0.140(0.332)0.085(0.148)-1.170 **(0.490)

18.42
0.010
0.170

0.229 **
(0.090)
27.82
0.001
0.236

X2

-0.019(0.063)LR chi2 stat for zero slope
8.34
8.96
p-value (Prob > chi2)
0.304
0.346
Pseudo R-squared
0.074
0.074
B. OLS regression with village-level characteristics controlled
X (years until the next election)-0.067 *-0.032(0.037)(0.087)2
X-0.006(0.018)
F-stat for zero slope
2.85
3.07
p-value (Prob > F)
0.004
0.001
R-squared
0.073
0.074
Number of observations
273
273
Mean of the dependent variable
0.480
0.480

0.036
(0.053)

7.25
0.000
0.254
234
0.440

-0.299 *(0.153)0.061 **
(0.028)
8.98
0.000
0.303
234
0.440

Notes: The observations in columns (1) and (2) are bengkok plots of village heads who are eligible to run for the
next elections. The observations in columns (3) and (4) are bengkok plots of eligible village heads that arerented out. Village-clustered standard errors are in parenthesis, with significance levels of * (10%), ** (5%), and*** (1%). Plot characteristics (dummy variables for unirrigated lowland plot, upland plot, and the size larger
than 1ha) and landlords’ characteristics (age, years of education, and asset index score) are included in both
Panel A and Panel B. Village characteristics (total area of the village, population to farmland ratio, number offactories, and distance to the district capital city) are also included in Panel B. Full regression results areavailable from the authors on request.

Appendix 11 Agricultural productivity, tenancy contracts and bengkok land

Paddy yield (tons/ha), all seasons in the past year

Sharecropping

(1)

(2)

(3)

(4)

-0.66***-0.63***-0.63***-0.13-0.63***-0.20(0.158)(0.157)(0.156)(0.129)(0.180)(0.150)

-0.11

-0.12

(0.145)(0.144)-0.85***-0.12(0.254)(0.247)

Bengkok land

Share cropping * bengkok

(5)

(6)

Control variables
Seasons

Yes

Yes

Yes

Yes

Yes

Yes

Plot characteristics

Yes

Yes

Yes

Yes

Yes

Yes

Village characteristics

Yes

Yes

Yes

Tenant characteristics

Yes

Village fixed effects

Yes
Yes

Yes

Yes

Yes
Yes

Observations

2,435

2,435

2,435

2,435

2,435

2,435

R-squared

0.199

0.204

0.211

0.445

0.212

0.446

Number of villages

130

130

Notes: Observations are plots that are either sharecropped or rented out in the last 12 months.
Village-clustered standard errors are in parenthesis, with significance levels of * (10%), ** (5%), and*** (1%). Two season dummy variables are included to indicate two seasons of paddy planting
within the last 12 months before the most recent one. Plot characteristics include dummy variables
for lowland plot, lowland unirrigated plot, and the size larger than 1 ha. Tenant characteristics
include age, years of education, and asset index score. Village characteristics (total area of thevillage, population to farmland ratio, number of factories, and distance to the district capital city) arealso included in columns (3) and (5).

50