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On the structure of tenancy contracts: theory and evidence from 19th century rural Sicily

Bandiera, Oriana (2000) On the structure of tenancy contracts: theory and evidence from 19th century rural Sicily. 19. Suntory and Toyota International Centres for Economics and Related Disciplines, London School of Economics and Political Science, London, UK.

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Identification Number: 19

Abstract

This paper analyses the empirical determinants of contract length, a key and yet neglected dimension of contractual structure. I use data on tenancy agreements signed between 1870 and 1880 in the district of Siracusa, Italy to estimate the choice over length and compensation schemes jointly. The findings indicate that the choice of contract length is driven by the need to provide incentives for non-observable investment, taking into account transaction costs and imperfections in the credit markets that make incentive provision costly. The results also illustrate that since both length and the compensation scheme are used to provide incentives within the same contract, joint analysis is important for a correct interpretation of the evidence.

Item Type: Monograph (Discussion Paper)
Official URL: http://sticerd.lse.ac.uk/
Additional Information: © 2000 Oriana Bandiera.
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD100 Land Use
H Social Sciences > HC Economic History and Conditions
Sets: Collections > Economists Online
Research centres and groups > Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD)
Departments > Economics
Date Deposited: 28 Feb 2008
Last Modified: 27 Apr 2012 09:03
URI: http://eprints.lse.ac.uk/id/eprint/3546

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