The Economics of Contract Choice

The book examines the nature of agrarian contracts which have long fascinated economists. Agricultural land tenancy and farm labour contracts are the basic institutions binding the life and work of billions of peasants in the Third World. Issues of efficiency and equity associated with a particular form of contract such as sharecropping are not merely of academic interest, but have critical bearing on the reform of land tenure, and credit and marketing institutions in poor agrararian economies. In the past, there have been major theoretical controversies surrounding the role of sharecropping and other land tenure forms in agriculture and rural development. Much confusion has stemmed from partial treatments of land and labour contracts separately. Through a comprehensive critical survey of the existing literature, this book indicates a way forward towards a general theory of agrarian contracts by integrating land and labour contracts as close substitutes along a single spectrum of contract choice. The theoretical developments are matched by a wealth of empirical data.
Insights gained from the scrutiny of agrarian contracts are also of relevant to industrial organization and management in modern urban economies.