Marshallian Puzzle of Sharecropping - about land tenure and their inefficiencies

Essay from the year 2008 in the subject Politics - Topic: Development Politics, grade: merit, University of Manchester (Institute for Development Policy and Management), course: Agriculture in Economic Development, language: English, abstract: Sharecropping or sharetenancy is a land tenure system in agricultural production which involves a landowner leasing land in return for a percentage of the output yield to a tenant. Sharecropping "e;has proved to be one of the most resilient economic institutions"e; (Taslim 1992), with a remarkable geographic diffusion in many developing nations in Asia and Africa as well as in highly developed countries like the USA. However, in his analysis of land tenure systems, Marshall (1890) argues that sharecropping is inefficient. While arguments for the inefficiency of sharecropping can be traced back to Adam Smith, Alfred Marshall provided the first clear argument in his 'Principles of Economics' which will be discussed in this paper. It will examine Marshall's inefficiency argument (part 2) and contradicting analysis (part 3). I will discuss a) Cheung's landowner model, b) the inclusion of incentive problems and c) uncertainty. As these analyses do not provide convincing arguments for the persistence of sharecropping, the paper will also examine the influence of imperfect markets and information in developing countries. In the following critical assessment (part 4) this paper will identify some flaws of the whole scientific debate.