State-contingent rent reduction and tenancy contract choice

• 成果类型: Article
• 署名作者: Arimoto, Y
• 署名单位: University of Tokyo
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2003.12.017
• 发表日期: 2005
• 页码: 355-375
• 关键词: tenancy contract; rent reduction; principal-agent model

摘要

This study introduces a fixed-rent contract with a state-contingent rent reduction widely adopted in Japan in the early 20th century, which a fixed-rent was temporary reduced in case of poor harvest. The economic implications of this contract are analyzed with a principal-agent model. It is shown that if the tenant is not too risk averse and/or the variability of the yield is not too high, then this contract is preferable for the landlord to a fixed-rent contract or a share tenancy. Preliminary tests on the risk-sharing implication of a share contract are also provided using the historical data for Japan and Korea. (C) 2004 Published by Elsevier B.V.