Land Reform in the Presence of Monitoring Costs and International Trade

REVIEW OF INTERNATIONAL ECONOMICS, October 17, 1996

Posted: 22 Nov 1996

See all articles by Nancy H. Chau

Nancy H. Chau

Cornell University - School of Applied Economics and Management; IZA Institute of Labor Economics

Abstract

This paper elucidates the implications of transaction costs in agrarian labor hiring activities in a two-sector model of international trade and identifies a link between the size distribution of land and intersectoral allocation of productive inputs. Ceteris paribus, a more unequal distribution of land increases the amount of out-migration from agriculture, a shrinkage of the production possibilityset and a decrease (increase) in the volume of trade if and only if agriculture is the exportable (importable) sector. In addition, non-intervention in factor and commodity markets is constrained optimal only when land redistribution is not a feasible policy option.

JEL Classification: F11, J23, J41, J43, O15, Q15

Suggested Citation

Chau, Nancy H., Land Reform in the Presence of Monitoring Costs and International Trade. REVIEW OF INTERNATIONAL ECONOMICS, October 17, 1996. Available at SSRN: https://ssrn.com/abstract=3676

Nancy H. Chau (Contact Author)

Cornell University - School of Applied Economics and Management ( email )

Ithaca, NY 14853
United States
607-255-4463 (Phone)
607-255-9984 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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