"Access to Markets and Farm Efficiency: A Study of Rice Farms in the Bicol Region, Philippines"

This paper presents an empirical investigation of the relationship between the spread, spatially and temporally, of market institutions and improvements in the productivity and efficiency of farmers. The data used in this study were collected over two decades in a sample of rice farms in the Bicol Region of the Philippines. Our estimates reveal a significant inverse relationship between distance from the market and farm productivity and efficiency in 1983. While there are substantial improvements in yields, unit costs, and efficiency in the two decades that followed, the gains are larger in the more remote and sparsely populated villages. This finding suggests that the relationship between remoteness and farm outcomes has weakened over time. We also find that the development of markets in the peripheral villages and the improved connectivity between the peripheral villages and market centers are facilitated by population growth, infrastructural investments (specifically, irrigation and roads), and the availability of agricultural extension programs.Farm Efficiency; Agricultural Markets; Institutional Conditions; Philippines

"Housing Inequality in the United States: A Decomposition Analysis of Racial and Ethnic Disparities in Homeownership"

In recent years, as the homeownership rate in the United States reached its highest level in history, homeownership itself remained unevenly distributed, particularly along racial and ethnic lines. By using data from the 2000 Integrated Public Use Microdata Series (IPUMS) and 2006 American Community Survey (ACS) to study the trajectory into homeownership of black, Asian, white, and Latino households, this paper explores the various socioeconomic and demographic characteristics, as well as the distinct immigration experiences and spatial patterns that shape racial and ethnic inequality in homeownership. The unique (merged) dataset enables the authors to distinguish assimilation (length of residence) from immigration cohort effects, and to control for various spatial characteristics at the PUMA (Public Use Microdata Area) level. The paper employs a decomposition technique that delineates the distinct effects that composition differentials have on the visible white-minority disparity in homeownership. The findings reveal substantial differences along racial-ethnic lines, highlight the importance of immigration and spatial context in determining Asian and Mexican homeownership rates, and emphasize the unique role that family structure and unobserved factors (e.g. prejudice and discrimination) continue to play in shaping the black-white homeownership gap.

Skills, Partnerships and Tenancy in Sri Lankan Rice Farms

This paper examines whether sharecroppers and fixed-rent tenants in the rice farms of South Asia are distinguished by their farming skills. The idea that fixed-rent contracts are typically given to relatively skilled tenants dates back to the agricultural (tenancy) ladder hypothesis of Spillman [1919]. The screening models [e.g. Hallagan 1978] that have attempted to formalize this idea assume that landlords do not observe the tenants' skill levels. This assumption is restrictive, and has found little support in empirical studies. The principal-agent model proposed in this paper focuses on the differences between time-intensive and skill- intensive labor tasks. I show that tenancy contracts are designed to match the provision of these tasks with the owners of time and skill inputs. Sharecropping, in this model, provides an incentive scheme that allows for the specialization between a time-abundant tenant and a skill-abundant landlord. The second part of the paper empirically explores this result with household-level data from Sri Lanka. A two-stage model that distinguishes the choice of contract from the extent of land leased is used. The results clearly show that relatively skilled farmers are more likely to become fixed-rent tenants. I also find that, conditional on contract choice, farming skills do not affect the extent of land leased. A substantial part of the empirical analysis is devoted to the measurement of farming skills. I interpret farming skills as the contribution of observed farmer characteristics to the technical efficiency of the farm. This measure recognizes that many dimensions of skills are observed, and the use of weights computed from a production function to construct the skill index is theoretically more appealing than the ad hoc selection of proxy variables.Land Tenancy, Farming Skills, Agricultural Labor, Sri Lanka

"Racial Preferences in a Small Urban Housing Market: A Spatial Econometric Analysis of Microneighborhoods in Kingston, New York"

This paper use spatial econometric models to test for racial preferences in a small urban housing market. Identifying racial preferences is difficult when unobserved neighborhood amenities vary systematically with racial composition. We adopt three strategies to redress this problem: (1) we focus on housing price differences across microneighborhoods in the small and relatively homogenous city of Kingston, New York; (2) we introduce GIS-based spatial amenity variables as controls in the hedonic regressions; and (3) we use spatial error and lag models to explicitly account for the spatial dependence of unobserved neighborhood amenities. Our simple OLS estimates agree with the consensus in the literature that black neighborhoods have lower housing prices. However, racial price discounts are no longer significant when we account for the spatial dependence of errors. Our results suggest that price discounts in black neighborhoods are caused not by racial preferences but by the demand for amenities that are typically not found in black neighborhoods.Housing; Race; Neighborhood Amenities; Spatial Econometrics Commonwealth of Independent States

Supervision and Transaction Costs: Evidence from Rice Farms in Bicol, the Philippines

Labor markets in all economies are subject to transaction costs associated with recruiting, monitoring and supervising workers. Rural labor markets in developing economies, where institutions such as labor and contract law and formal employment assistance mechanisms are not in place, are regarded to be particularly sensitive to transaction cost conditions. The inherent difficult of measuring transaction costs has limited studies on this topic. In this paper, we analyze supervision activities reported in a cross-section survey of rice farmers in the Bicol region of the Philippines. This survey is unique because it provides supervision data at the farm task level. We present a simple optimization model in which supervision intensity increases the productivity of hired workers, which is assumed to be lower than that of family members due to the transaction costs. The model predicts that supervision intensity will increase with transaction costs. We use different institutional conditions to proxy for transaction costs, and estimate the demand for supervision time for four different classes of rice production tasks. The estimation strategy controls for selectivity in both hiring and supervising. The results show a positive effect of transaction costs on supervision intensity. We then extend the analysis to a farm efficiency specification to test the proposition that supervision activities improve farm efficiency. This framework allows us to relate institutional conditions to farm efficiency directly and indirectly through their effect on supervision activities. We find that transaction costs have a negative direct effect on farm efficiency, but this is partially offset by the positive efficiency effects of increased supervision intensity. The results enable us to associate institutional conditions with transaction costs and to draw policy inferences regarding the value of improved institutional conditions.Transaction Costs, Supervision, Labor Markets, Philippines

SUPERVISION AND TRANSACTION COSTS: EVIDENCE FROM RICE FARMS IN BICOL, THE PHILIPPINES

Labor markets in all economies are subject to transaction costs associated with recruiting, monitoring and supervising workers. The level of transaction costs affects labor and land contract choices and family labor advantages. Rural labor markets in developing economies, where institutions such as labor and contract law and formal employment assistance mechanisms are not in place, are regarded to be particularly sensitive to transaction cost conditions. A number of studies of contract choice support this contention. The inherent difficulty of measuring transaction costs, however, has limited studies on this topic. In this paper, we analyze supervision activities reported in a cross-section survey of rice farmers in the Bicol region of the Philippines. This survey is unique because it provides supervision data at the farm task level in addition to information on production activities and household characteristics over a range of institutional conditions. It also provides barangay (village) level variables that help us to quantify institutional conditions. The data show that family workers either work or supervise, but do not do both at the same time. This is consistent with a simple optimization model in which supervision intensity increases the productivity of hired workers, which is assumed to be lower than that of family members due to the transaction costs. The model predicts that supervision intensity will increase with transaction costs. We use different institutional conditions to proxy for transaction costs, and estimate the demand for supervision time for four different classes of rice production tasks. The estimation strategy controls for selectivity due to two sources: not all farms use hired labor, and not all farms that use hired labor actually supervise. The results indeed show a positive effect of transaction costs on supervision intensity. We then extend the analysis to a farm efficiency specification to test the proposition that supervision activities improve farm efficiency. This framework allows us to relate institutional conditions to farm efficiency directly and indirectly through their effect on supervision activities. We find that transaction costs have a negative direct effect on farm efficiency, but this is partially offset by increased supervision intensity which enhances efficiency. The results enable us to associate institutional conditions with transaction costs and to draw policy inferences regarding the value of improved institutional conditions.Crop Production/Industries,

Supervision and Transaction Costs: Evidence from Rice Farms in Bicol, the Philippines

Labor markets in all economies are subject to transaction costs associated with recruiting, monitoring and supervising workers. Rural labor markets in developing economies, where institutions such as labor and contract law and formal employment assistance mechanisms are not in place, are regarded to be particularly sensitive to transaction cost conditions. The inherent difficulty of measuring transaction costs has limited studies on this topic. In this paper, we analyze supervision activities reported in a cross-section survey of rice farmers in the Bicol region of the Philippines. This survey is unique because it provides supervision data at the farm task level. We present a simple optimization model in which supervision intensity increases the productivity of hired workers, which is assumed to be lower than that of family members due to the transaction costs. The model predicts that supervision intensity will increase with transaction costs. We use different institutional conditions ..