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on Contract Theory and Applications |
| By: | Onofri, Laura; Trestini, Samuele; Mamine, Fateh; Loughrey, Jason |
| Abstract: | Formal written land leasing contracts offer an alternative to land purchase for those farmers wishing to expand their land area and provide greater security relative to informal short-term rental agreements and are particularly important for beginning farmers with resources insufficient to purchase land. Formal land leasing contracts vary in terms of their duration but there is limited understanding about the determinants of contract duration in developed countries. In this research, we use econometric techniques and transaction level data to explore the determinants of duration for agricultural land lease contracts for two regions in Ireland. Under the Transaction Cost Economics approach, the research explores the role of legal status, price and non-price conditions in influencing the contract duration. Results indicate that the legal status of the tenant is a significant factor in influencing the duration. Provisions such as break clauses appear positively related to duration and confirm the theoretical expectation that long-term contracts create a demand for processes that enable adaptation over the course of long-term exchange. |
| Keywords: | Farm Management, Land Economics/Use |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc22:321211&r= |
| By: | Xiaoming Cai; Pieter Gautier; Ronald Wolthoff |
| Abstract: | In this paper, we construct a framework to investigate how the way in which market participants meet each other affects outcomes like equilibrium trading mechanisms and allocations. We do so in an environment in which identical sellers post mechanisms to compete for buyers with ex-ante heterogeneous private valuations. We show that the market may segment into multiple submarkets, each consisting of all sellers posting a particular mechanism and all buyers deciding to visit those sellers. Under mild conditions, high-valuation buyers are all located in the same submarket. Then, we establish under what conditions, low valuation buyers are in: (i) the same submarket, (ii) a different submarket and (iii) a mixture of (i) and (ii). The decentralized equilibrium is always efficient when sellers can post auctions with reserve prices or entry fees. |
| Keywords: | search frictions; directed search; matching function; meeting technology; competing mechanisms; competing auctions |
| JEL: | C78 D44 D83 |
| Date: | 2022–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-727&r= |
| By: | Pugatch, Todd (Oregon State University); Schroeder, Elizabeth (Oregon State University); Wilson, Nicholas (Robinhood) |
| Abstract: | We design a commitment contract for college students, "Study More Tomorrow," and conduct a randomized control trial testing a model of its demand. The contract commits students to attend peer tutoring if their midterm grade falls below a prespecified threshold. The contract carries a financial penalty for noncompliance, in contrast to other commitment devices for studying tested in the literature. We find demand for the contract, with take-up of 10% among students randomly assigned a contract offer. Contract demand is not higher among students randomly assigned to a lower contract price, plausibly because a lower contract price also means a lower commitment benefit of the contract. Students with the highest perceived utility for peer tutoring have greater demand for commitment, consistent with our model. Contrary to the model's predictions, we fail to find evidence of increased demand among present-biased students or among those with higher self-reported tendency to procrastinate. Our results show that college students are willing to pay for study commitment devices. The sources of this demand do not align fully with behavioral theories, however. |
| Keywords: | economics of education, higher education, commitment contracts, randomized control trials |
| JEL: | D91 I21 I23 |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15367&r= |