Agriculture Reference
In-Depth Information
In part I (chapters 3-5) we examine contracting for land and focus on the classic question of
what determines the optimal contract choice for the farmer and landowner. In chapter 3 we
examine the form of these contracts and address the issue of why they are so simple. In doing
so we put these contracts into their common law context and analyze the role reputation
and specific assets play in policing behavior that is ultimately revealed. In chapter 4 we first
develop the basic model that appears throughout the topic. This model includes the trade-
off between the incentive to overuse rented land and underreport the crop. In chapter 5 we
extend this analysis to the case where many inputs other than land and labor are used and
potentially shared. All three of these chapters provide evidence that support our transaction
cost framework.
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