Efficiency and Equity Impacts of Rural Land Rental Restrictions: Evidence from India

By K. Deininger, Songqing Jin, H. Nagarajan. 2007

145 citations recorded by the source corpus.

Recognition of the potentially deleterious implications of inequality in opportunity originating in a skewed asset distribution has spawned considerable interest in land reforms. However, little attention has been devoted to fact that, in the longer term, the measures used to implement land reforms could negatively affect productivity. Use of state level data on rental restrictions, together with a nationally representative survey from India, suggests that, contrary to original intentions, rental restrictions negatively affect productivity and equity. The restrictions reduce the scope for efficiency-enhancing rental transactions that benefit poor producers. Simulations suggest that, by doubling the number of producers with access to land through rental, from about 15 million currently, liberalization of rental markets could have far-reaching impacts.

Subfields: General Agricultural and Biological Sciences, Soil Science, Urban Studies

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In General Agricultural and Biological Sciences

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Citations in the corpus

The common agricultural policy and the determinants of changes in EU farm size (2013, background): “In their explanation of transaction costs, the authors have mainly considered farm characteristics connected with social capital or education as key elements explaining different behaviours (Allen and Lueck, 2002; Deininger et al., 2008).”
The Role of Smallholder Farms in a Changing World (2020, background): “The same can be seen in India and China, where reduced restrictions on land rental markets improved agricultural productivity by transferring land tomore efficient (but often still poor) producers (Deininger and Jin 2005; Deininger et al. 2008).”
Rental markets for cultivated land and agricultural investments in China (2012, background): “, India—12%), the rate is below 20% (Deininger and Jin, 2008; Deininger et al., 2008; Vranken and Swinnen, 2006).”
How not to think of land-grabbing: three critiques of large-scale investments in farmland (2011, background): “The emergence of rental markets can improve access to land particularly for land-scarce and labor-abundant households with little education (for the example of India, see Deininger et al. 2006b).”
The puzzle of East and Southeast Asia's persistent smallholder (2016, background): “From a production e rather than from an equitye point of view, such policies are seen to limit the efficiency-enhancing accumulation of land into larger units of production (Fan et al., 2013: 3; Deininger et al., 2008).”