Contracts, resource use and productivity in sharecropping

Abstract

Abstract This article identifies the contractual terms in sharecropping that result in efficient use of resources. Evidence is then presented from Pakistan to comment on the manner in which landlords ensure that sharecroppers fulfil the terms. It is shown that landlords in general specify contract terms that encourage sharecroppers to adopt new techniques of production. Productivity comparisons are also made for farms under different tenancy contracts to conclude that share‐cropping tenancies do not appear to result in output loss even when technology is changing. Notes Department of Economics, Quaid‐e‐Azam University, Islamabad, Pakistan. Funds for the study were provided by ESCAP, Bangkok, and the Overseas Development Administration, UK. I am grateful to Professors Nick Stern and David Newbery and an anonymous referee for comments.