CREDIT MARKETS, WEALTH AND ENDOWMENTS IN RURAL SOUTH INDIA Hans P. Binswanger and Mark R. Rosenzweig Paper prepared for the 8th International Economic Association World Congress New Delhi, India, * December 1-5, 1986 I -- a - - .s 1orld Bank and University of Minnesota, respectively@ The World Bank oes not accept responsibility Eor the views expresses herein, vhich are chose of the authors and should not be attributed co the Vorld Bank of its affiliared organizations. The authors a r e s t a f f mernber(s) and consultant(s) of the World Bank. However, the World Bank does not accept r e s p o n s i b i l i t y f o r the views expressed herein which a r e those of the authors and should not be a t t r i b u t e d t o the World Bank o r t o its a f f i l i a t e d organizations. The findings, i n t e r p r e t a t i o n s , and conclusions a r e t h e r e s u l t s of research supported i n p a r t by t h e Bank; they do not necessarily represent o f f i - c i a l policy of the Bank. The designations employed and the presenta- t i o n of material i n t h i s document a r e s o l e l y f o r the convenience of the reader and do not imply the expression of any opinion whatsoever on t h e p a r t of t h e Uorld Bank o r its a f f i l i a t e s concerning the l e g- a l s t a t u s of any, country, t e r r i t o r y , a r e a o r of its a u t h o r i t i e s , o r con- cerning the d e l i m i t a t i o n of its boundaries, o r n a t i o n a l a f f i l i a t i o n . CREDIT HAEUCETS, WEALTH AND ENDOWNTS IX RURAL SOUTH INDIA* Kans P. Sinsvanger and Mark R. Sosenzweig INTBODUCTION The seasonality and variability of agricultural production render the demand for and supply of credit of particular importance in agricultural settings. In this paper, ve discuss how incentives and information problems combined with the material features of agriculture affect the existence and nature of rural credii markets and how credit market problems are manifested in other factar markets. By focusing on the interrelations among debt, wealth, borrowing and lending behavior, ve derive implications for efficiency and intergenerational mobi1i:y. We then use longitudinal survey data from three villages in the semi-arid tropical region of India to estimate econometrically the interre- lationships between a household's current asset position and the probabilities of the household's receiving n loan from formal, informal, public and private credit sources. Our econometric procedure controls for the possibility that households are heterogeneous in attributes which influence their ability to obtain credit 'and thus enable them to accumulate wealth. We also explore econometrically the deteminants of life-cycle debt and wealth accumulation. Our empirical results indicate that the amount and the form of a household's assets are isportant determinants of the probability of receiving * credit, that heterogeneity can lead to misleading conclusions about the .role of * Taper prepared for che 8th International Economic Association World Congress, New Delhi, India, December 1-5, 1986. h i s i n c e n t i v e t o d e f a u l t , and t h e lender would be unwilling t o accept t h e c o n t r a c t . provide i n c e n t i v e s f o r d e f a u l t , t h e l i m i t e d supply w i l l also, and perhaps primarily, be r e f l e c t e d i n s m a l l e r r a t i o n s , s h a r p e r s e l e c t i c n of borrowers by lenders, s h o r t e r repayment periods and/or more c o l l a t e r a l . - D. Absent Crop Insurance and Its Conseauences f o r ~ h Credi: e :-farket A s is w e l l known, u n c e r t a i n t y i n production would not a f f e c t investmt..t and borrowing behavior i f production r i s k s could be insured, But i n agricui:ure, t h e key insurance market is u s u a l l y n i s s i n g a s g e n e r a l crop insurance is not s u s t a i n a b l e without heavy governzent s u b s i d i e s , I n "Production Relations" we a t t - r i b u t e t h e absence of t h e rnarkct f o r crop y i e l d insurance:/ t o t h e very high c o s t of measuring t h e d i f f e r e n c e bezween nornal y i e l d and c u r r e n t y i e l d on v i d e l y dispersed p l o t s of hetetdgeneous q u a l i t y . This leads t o d i f f i c u l t moral hazard probleas, as explained i n g r e a t e r d e t a i i s i n " P r o d ~ c c i o n Relations". This informatio? and moral hazard prohlom csnnct be overcome by insurance provided by 2 weli-informed Local entrepreneur, such hs a wea1:hy farmer, because y i e l d r i s k s are highly c o r r e l a t e d w i t h i n small areas. This r e q u i r e s t h e l o c a l i n s u r o r t o hold very Large r e s e r v e s , making t h e insurance scheme unprofitable. Vncertainty i n production, combined with t h e absence of i n s u r a n c . , * . # w i l l have a f l r t h e r impact on borrowing, lenaing and production behavior. Where insurance marke;s a r e not w e l l developed, insurance considerations s p i l l over i n t o the c r e d i t market, as c r e d i t w i l l become one of s e v e r a l insurance - .r . * s u b s i t i t u t e s . I f i n d i v i d u a l s know t h e i r r a t i o n s , t h e i r o p t i r n n ~borrowing, f o r r s given r a t i l n s , w i l l be l e s s than t h e r a t i o n s because they mus: leave an open - 'Jhile g e n e r a l crop y i e l d insurance is no; s u s t a i ~ 3 b i evichout subsidy, markets t o i n s u r e s p e c i f i c r i s k s (such as h a i l ) whose impact can be e a s i l y ncasured e x i s t i n a v a r i e t y of s e t t i n g s . I c r e d i i Line a s insurance a g a i n s t adverse events. Careful borrowers would borrow up t o t h e i r borrowing constraLnt only a f t e r a sequence of u n f o r t u n a t e events. And they vould be f a r t h e r away from t h e i r borrowing c o n s t r a i n t t h e higher t h e i r r i s k aversion. Thus, a s t a t e a e n t from a borrower t h a t he could g e t more l o a n s d; t h e gilren i n t e r e s t r a t e , and t h e w i l l i n g n e s s of lenders t o provide such ltoans does nor inply t h a t i n v e s t n e n i , production and borrowing Sehavlor have not a l r e a d y been a f f e c t e d by c r e d i t r a t i o n s . I n a d d i t i o n , the absence of insurance would r e s u l t i n a r e l u c t a n c e of t h e borrowers t o provide c o l l a t e r a l , o r t o tie it a l l i n loan c o n t r a c t s . Only by keeping a portion of t h e i r a s s e t s a s unused c o l l a t e r a l can they borrow more a t favorable terms i f a d i s a s t e r s h o t ~ l d s t r i k e them, Ownership of a s s e t s with high s i g n a l and c o l l a t e r a l v a l u e should provide owners with an advantage t n t h e c r e d i t markets both i n t e r n s of t h e s i z e and t h e c o s t of loans. Other t h i n g s equal, an i n c r e a s e i n t h e s h a r e of wealth held i n a s s e t s w i t h high s i g n a l o r c o l l a t e r a l value w i i l enable l a r g e r borrowings. The r e t u r n t o owning a n a s s e t w i l l include both t h e value of out.put i: helps grodu-L as w e l l as the differentis! c r e d i t market advantage it provides. I n d i v i d u a l s w i l l respond t o these r a c e of r e t u r n d i f f e r e n t i a l s and . t w i l l d r i v e up the value of i n e l a s t i c a l l y supplied a s s e t s with c o l l a t e r a l and/or s i g n a l value r e l a t i v e t o those without. - -. l e n d e r s ~ i iuse c o n t r a c t terms a s screening devices. l Loans of small 1 amounts wiLJ be provided without c o l l a t e r a l but a t high l n t e r e s t r a t e s t o cciver P t h e Lendtr & t;ansactions and information c o s t s . Borrowers i:: gcod standing, o r v i t h l a r g e amoun's of c o l l a t e r a l , w i l l be given Larger loans a t lower i n t e r e s t raLes. [This ha:; aiready been documented f o r t h e v i l l a g e s which we w i l l e u . n i n e helow Sinswanger rt a l . ] . Both ? ~ n o p o L i s t i cand competitive Lenders would b.zhave i n t h i s ray. I n a simple c r o s s - s e c t i o n a l comparison loan s i z e and i n t e r e s c ra:e . d i l l be negatively c o r r e l a t e d . o f t h e s e endowments is parents. Because one cannot borrow by using f u t u r e earnings a s c o l l a t e r a l , t h e p a r e n t a l a b i l i t y t o f i n a n c e education a l s o imparts an i n h e r i t e d c h a r a c t e r i s t i c t o education, e s p e c i a l l y when primary education enrollment is n o t u n i v e r s a l , a s i n t h e study v i l l a g e s . Problems of t h e c r e d i t market t h u s c o n s t r a i n i n t e r g e n e r a t i o n a l mobility t o t h e e x t e n t t h a t wealth endowments, independent of a b i l i t y , determine l i f e t i m e borrowing o p p o r t u n i t i e s . 11. THE STUDY VILLAGES AND THEIR CREDIT HARKETS The l o n g i t u d i n a l household d a t a u t i l i z e d i n t h i s study is based on t h e v i l l a g e surveys undertaken by t h e I n t e r n a t i o n a l Crops Research I n s t i t u t e f o r t h e Semi-Arid T r o i c s , i n Hyderabab over t h e period 1975/76 t o 1984/85. We used a s u b s e t of t h e i r d a t a from 104 households i n t h r e e v i l l a g e s covering nine consecutive a g r i c u l t u r a l years, 1975/76 t o 1983/84. The t h r e e v i l l a g e s a r e X u r e p a l l i i n t h e Yahboobnager d i s t r i c t of hndhra Pradesh, and Shirapur i n t h e Sholapur and Kanzara i n t h e Akolz d i s t r i c t s of Yaharasthra. The study v i l l a g e s have been described i n d e t a i l elsewhere (Jodha e t al., and Jodha). .U.though a l l t h r e e v i l l a g e s a r e c h a r a c t e r i z e d by high agroclfmatic r i s k s , t h e r i s k s a r e . I lowest i n Kanzara where an even d i s t r i b u t i o n of r a i n f a l l reduces production - - v a r i a b i l i t y . The =re@: inarkets i n t h e s e v i l l a g e s have been described i n g r e a t d e t a i l i n Bhende azd i n Rinswanger e t a l . 1985, and only a cursory description * is given here. TaBle 1 shows t h e average volume of new loans Laken by t~ausehold per year Erom Five d i f f e r e n t credi: sources For t h e years 1976177 t o 19831'84. It also shows :he to:al nunber of such new loans over t h e e n t i r e period. These d e t a i l s a r e presented bo:h by v i l l a g e and by wealth q u a r t i l e . Aurepalli is a v i l l a g e y i t h a well-developed t r a d i t i o n a l money lending system. The cooperative s e c t o r is only represented by the land development bank an-d o c r e d i t cooperative e x i s t s (Table 1). The f i v e moneylenders t h e r e , who a r e a l s o farmers, lend exclusively out of equity. They have two c l a s s e s of loans: To t h e i r wealthier c l i e n t s , with whom they have long-tzrs r e l a t i o n s h i p s , they grant f a i r l y l a r g e loans up t o R s 10,000 a t an i n t e r e s t ra:e of 18%p e r year. To small farmers they grant crop Loans, usually i n kind which have t o be repaid, usually i n kind, with 252 or 50% i n t e r e s t overthe crop cycle, i.e., annualized i n t e r e s t r a t e s of 75% t o 100%. Landless households of:en cannot borrow from noneylenders and u s e other sources. Such loans, c l z s s i f i e d under "other loans", include a l l t i e d c r e d i t t r a n s a c ~ i o n swi:h employers, landlords, tenants, shopkeepers and merchants. They a l s o include i n t e r e s t - f r e e advances from f r i e n d s and r e l a t i v e s . In Aurepalli most other loans a r e given with e x p l i c i t i n t e r e s t and come from erployers. Government agencies do v i r t u a l l y no lending i n t h i s v i l l a g e . In Shiapur and Kanzara t h e erergence of the cooperative system i n t h e 1950s and 1960s has Led t o the demise of the t r a d i t i o n a l moneylenders, who quickly l o s t t h e i r best c l i e n t s . I n t h e i r place have emerged minor moneylenders t L who lend smaller amounts f o r s h o r t e r periods a t higher i n t e r e s t r a t e s compared - t o Aurepalli. I n cerns of the number of loans,-the cooperative s e c t o r i s a p a r t i c u l a r l y important i n Ranzara, bu: t h e amoua of lending from t h e - cooperative s e c t o r per household is l e s s than w h t moneylenders advance i n * B - !B - Aurepalli. Governmen; agencies a r e a l s o p a r t i c u l a r l y active. Commercial banks give the l a r g e s t number of loans 521 Kanzara ( l a ) , b u t the nine loans given by commercial banks in Aurrpalli weri! for nuch Larger amounts. I n Shirapur "other loans" a r e t h e s i n g l e most important source. These loans a r e dominated by i n t e r e s t - f r e e advances between r e l a t i v e s and f r i e n d s . I n Kanzara o t h e r loans a r e somewhat l e s s important and a r e dominated by advances from merchants i n t h e nearby Taluka headquarters. I n a l l v i l l a g e s , Loans from employers, exchanged f o r long-term labor c o n t r a c t s , a r e the only way landless individuals can borrow amounts l a r g e r than required f o r a few days subsistence. Many poor people finance t h e i r marriage with such loans (Binswanger et al., 1984). Advance payments f o r short-term l a b o r commitments e x i s t only i n Shirapur and a r e r a r e even there. Lending from landlords t o tenants is very limited (Jodha). But tenants may pay t h e i r r e n t a l payment i n advance o r provide d i r e c t loans. Consistent with our discussion i n the theoreEica1 s e c t i o n , t h i s p r a c t i c e was e s p e c i a l l y prevalent i n Sb'iapur during t h e gears Eollowing t h e g r e a t Yaharasthra drought of the e a r l y 1970s. Chit funds, o r revolving c r e d i t s o c i e t i e s , e x i s t i n Aurepalli and Shirapur. In Aurepalli they involve f a i r l y l a r g e amounts but a r e used a l n o s t exclusively by merchants and people with fixed incomes, s i n c e a g r i c u l t u r a l i s t s cannot e a s i l y come up with s u b s t a n t i a l amounts of c r e d i t a t regular inEervals. In Shiraput, they a r e used mainly by women with l i t t l e o r no access t o c r e d i t L markets who use them Eo save money f o r l a r g e r purchases. The relevance of t h e - c h i t funds f o r financing a g r i c u l t u r e is negligible. - [Jhile t h e repayment performance f o r moneyLender and other privately- 2 1 granted loans seems t o be good i n a l l three v i l l a g e s , both Shiraput and Sanzara- 8 *.. v i l l a g e s have acquired a "culture" of non-repaymen: f o r government and ioopera- t i v e s e c t o r loans; d e f a u l t s from o f f i c i a l sources a r e public knowledge y e t no stigma is atcached co f a i l u r e t o repay. This is a widely-observed p.ienomenon i n subsidized r u r a l c r e d i t schemes (von Pischke e t a l . ) . Indeed, respondents vere q u i t e happy t o calk about :heir overdues f o r chose Loan sources. The poor repayment performance a r i s e s d e s p i t e the f a c t t h a t t h e o f f i c l a l c r e d i t agencies operate within a comprehensive l e g a l framework t h a t has ample power t o recover c r e d i t . Morenver, i n Akola region t h e agencies can, i n principle, recover c r e d i t v i a t h e monopoly procurement agency f o r cotton which can s u b t r a c t outstanding debt t o o f f i c i a l c r e d i t agencies from che amounts owned t o t h e s e l l e r s . Only a t i n y f r a c t i o n of loans has no Eormal c o l l a t e r a l requirement i n t h e form of land o r t h i r d party guarantees. Third party guarantees a r e e s p e c i a l l y prevalent i n Akola region but we know of no case i n which repayment has ever been received from a guarantor. Also, o f f i c i a l c r e d i t agencies v i r t u a l l y never use t h e i r power t o foreclose on land used as c o l l a t e r a l . Small tnformal lenders cannoc use land a s c o l l a t e r a l . They a r e not r e g i s t e r e d under the noneylending r e g i s t r a t i o n a c t , hence they cannot use . promissory notes secured by land. Indeed, the h o s z i l i t y of the ?faharaszhra government and t h e c o u r t s t o enforce land c o l l a t e r a l has seriously undernined irs use. 111. ECONOMETRICS ESTIMATES OF SOURCE-SPECIFIC LOAN PROBABILITIES XND ASSET LW DEBT ACCWLATION A. Variables and Estimation Issues I n t h i s s e c t i o n we presen: econometric estimates of how an agent's a b i l i r y t o borrow from d i f f e r e n t sources is a f f e c t e d by his_wealth p o s i t i o n , h i s l i a b i l i t i e s and h l s current a g r i c u l t u r a l p r o f i t s . In i n v e e i g a t i n g the wealth-credit nexus, one is confronted with serious econometric problem. The f i r s t , discussed i n the cheory s e c t i o n , is the fac: chat both su~;!Lrrs and demanders of c r e d i t must look ac t h e same opzimizacion problem i n deciding I n addition t o t h e exogenous v a r i a b l e s j u s t Listed, the f i r s t s t a g e regressions r the jointly endogencus variables include the following v a r i a b l e s t..- serve t o ident<-fy the s t r u c t u r a l e f f e c t of a s s e t position on I n h e r i t e d !?ealth: The t o t a l value of a l l - s a l t 5 inherired up t o t h e I beginning of the curren: a g r i c u l t u r a l year. Year of Lnherit2- The calendar year i n which the inheritance was I received. in her'^ Year: I n t e r a c t i o n between the ar2iount arkd the year of he Kharif S o i l Yoisture and Rabi S o i l Yoisture: S o i l moisture i n d i c e s f o r the v i l l a g e s which take i n t o account no: only totaL r a i n f a l l but a l s o s o i l c h a r a c t e r i s t i c s and ;he i i s t r i b u t i o n of r a i n f a l l w i t h i n t h e season. Current p r o f i t s w i l l be strongly a f f e c t e d . Lagged Weather: The valc 5 of the two weather variables j u s t I discussed f o r the previous a g r i c u l t u r a l year. They w i l l influence ASSETS and LTABILITIES a t t h e beginning of t h e year. L Lagged Wages: The wage v a r i a b l e s of the previous year f o r males, ternales and children. Yoreover, t h e cooperatives appear t o pay l i t t l e a t t e n t i o n t o a s s e t awnership. F u r t h e r , t h e government agencies favor people with l e s s assets but whose a s s e t s a r e h e a v i l y invested i n land. Since t h e repayment performance f o r loans from che cooperative s e c t o r and t h e governmen: agencies is very poor, t h e s e s e l e c t i o n c r i c e r i a do not appear t o be able t o i d e n t i f y r e l i a b l e borrowers. C. Wealth stcumulation and debt. The r e s u l t s i n Table 3 i n d i c a t e t h a t d i f f e r e n t l e n d e r s behave q u i t e d i f f e r e n t L y i n t h e c r e d i t market. Moreover, wealth matcers i n gaining Dccess t o p r e f e r r e d c r e d i t sources. People with very l i t t l e wealth have e i t h e r no access t o s u b s t a n t i a l amounts o f c r e d i t o r have t o r e s o r t t o poor sources of c r e d i t such a s higL. i n t e r e s t crop loans from m~ney-lenders o r t o t i e d t r a n s a c t i o n s . I n a d d i t i o n , t h e for= of a s s e t holding m a t t e r s , although i n ;.,or; complex uays Chan .;e envisioned i n "Produc:ion Relations" where we ignored t h e p o t e n t i a l insurance s u b s t i t u t e function of r e n t a l narkets. But what d e t e r n i n e s a household's c u r r e n t a s s e t p o s i t i o n ? I n Table 4, we show reduced Sorn equations thac focus e x c l u s i v e l y on t h e r e l a t i o n s h i p s between endownuient v a r i a b l e s , weaath and accumulated debt and omit c u r r e n t weather and sage v a r i a b l e s . It is quite remarkable that inheritances, schooling attainment and age a r e a b l e t o e x p l a i n almosc 50% of t h e v a r i a t i o n i n cG-rent wealEh. J - D i f f e r e n c e s i n t h e values inhericed and its timing a s w e l l a s schooling a l s o - 1 . accounz &or 402 of t h e v a r i a c i o n i n t h e value of l a n d h o l d i n g e a n d 25% of ihe I v a r i a t i o n i n ! - i a b i l i t i e s . This high explanatory pouer a r i s e s d e s p i t e ;he f a c t t h a t t h 2 i n f l u e n c e of c a s t e is Lef; o u t , an e f f e c t w e inc-nd ~o examine i n subsequent work. I n h e r i t e d u e a l t h has very powerful e f f e c t s with l a r x e c o e f f i c i e n t s and very h i g h t - r a t i o s f o r t o c a l a s s e t s ~ n dland ownership. The e f f e c t of t h e more d e s i r a b l e sources axd loan types. I n c o n t r a s t , we found l i t t l e evidence of screening v i a education o r age, once wealth is properly accounted- for. However education was shown t o have powerful impacts on t h e a b i l i t y t o accumulate wealth i t s e l f . These phenoioena a r i s e because - a s theory suggests -- repayment incentives a r e of c e n t r a l importance i n t h e markets for loans. A s the dismal r e p a g e n t experience of t h e cooperative s e c t o r s and of t h e governmeqt agencies a l s o suggests, repayment incentives can only be ignored a t a high cost. Norrover, i~ is extremely easy t o undermine repayment incentives, such a s the c o l l ~ t e r a lvalue or land, v i a s t a t e action. The feacures of these c r e d i t markets iaply :ha: inherited endowncnts a r e c e n t r a l t o t h e a b i l i t y i o acquire productive a s s e t s o u ~of equity and t o eqgage i n a d d i t i o n a l borrowing f o r investments and f o r working c a p i t a l . Therefore, i n h e r i ~ e dendowments, not j u s t a b f l i t i e s , determines the c a p i t a l stock an i n d i v i d u a l has t o work with. Unless a b i l i t y and inheritance a r e p e r f e c t l y c o r r e l a t e d , an i n e f f i c i e n c y ensues. It is of course trivial to show -- v i a a c o r r e l a t i o n-- :ha; more wealthy people have more debt; a f t e r a l l t ' e wealt'ly invest more. ' However, one point is t h a t it is because they have nore wealth t h a t t h e wealthy a r e b e t t e r able t o borrou, not because they necessarily r~rethe b e t t e r investors. d P Table 3: Probabil i t y of c u r r e n t -borrowing from d i f f e r e n t sources ( S t ~ c t u r a lP r o b i t Equations) Cooperative Commeicia 1 Banks System Government Other Lenders TS-Prohi t TS-Probi t TS-Probi t TS-Probi: - Shirapur Kanzara Education Age Assets Land Ovnsd Debt Prof its Current Inheritance .1499P,-04 .2677E-04 -.1468E-02 -.2237E-02 -.5557E-04 ,5835E-05 (2.07) (3.17) !-.03) (-0.08) (-.60) (1.32) Xale wage -1 -6814 -1.0382 3.1710 -.1889 2.8794 .7190 (-4.60) (-2.61) (2.23:1 (-Ah) (3.76) (2.12) Female wage 1.5926 -7338 -2.5361 -.I837 -1 3 9 0 6 -.I507 (5.56) (1.87) (i'.OO) (-.$O) (-2.07) (-2.13) Child wage 1.073 -9727 -1.545 ,3411 -1.3941 .US LRE-02 (L.i9) (3.31) (-1.87) (1.22) (3.64) ( .04) -- Loy Likeiihood -000.:9 -3-5.96 -54.57 -263.32 -121.86 -0ih.52 Chi-square 256.a5 299.3 1 33.19 114.69 106.35 117.79 Table 4: Wealth, Owned Land and L i a b i l i t i e s a s Functions of Endowment Variables (Reduced form OLS equations) Value of Total Accumulated Assets Owed Land Debt Constant -22646 -11751 -738.4 (-1.79) (-1.13) (-0.43) Sh irapur 4826.57 5489.87 641.20 (2.27) (3.15) (2.23) Kanzara Education 9555.75 7211.99 566.99 (12.28) (1 1.30) (5.38) Age Square Inherited 4.988 3.824 0.546 Wealth (11.38) (10.64) (9.21) Inheritance -1.23E-07 -1.12E-07 -2.49E-07 Square (0.44) (0.50) (-6.64) Year of . -0.062 -0.048 -0 -006 I Inheritance (-10.12) (-9.64) (-7.77) Inheritance Y -83.59 -74.20 -9.045 Years Inherited (-2.60) (-2.81) (-2.08) -. t - s t a t i s t i c s i n parenthesis REFERENCES Bell, Clive. "Alternative Theories of Share Cropping: Some Tests Using Evidence from Northeast India." Journal of Development Studies, Vo1.13, 1977, pp, 317-346, Bhende, Y.J. "Credit Yarkets i n the &mi-Arid Tropics of Rural South India." Incsrnational Crops Xesearch I n s t i t u t e f o r the Semi-Arid Tropics, Bcor~onicsProgram Progress B e ~ o r tNo, 56, November 1983. 3i!1s-*rsnger, Ha9s P. "Risk Aversion C o l l a t e r a l Requirements and the ;Ciarkets f o r Credit and Insurance i n Rural Areas," i n P. Hazell, C, Pomerada and A, Valdes (eds,), Crop Insurance f o r Agricultural Development Issues and Experience. Baltimore: John Hopkins University Press, 1985. Binswanger, Hans ?. and NOR, Rosenzweig. "Contractual Arrangements, Employment and Wages i n Rural Labor ?farkets: h C r i t i c a l Review," i n H.Binswanger and Y. Rosenzueig (eds.), Contractual Arrangements, Employment and Wages i n Rural Labor Yarkets i n Asia. New Haven: Yale University Press, 1984. Binswanger, Xans P. and X.R. Rosenzweig. "8ehavioral and N a t e r i a l Determinants of Producrion Relations i n Agriculture." Journal of Development Studies, Vol. 22, No.3, April 1986, pp. 503-539. Binswanger, Hans P., Victor S. Doherty, T. Balaramaiah, M.J. Bhende, K.G. Kshirsagar, V.B, !2ao and P.S.S. Raju. "Common Features and Conirasts i n Labor Relations i n t h e Semi-Arid Tropics of India," i n H, Binswanger and - ?f. Rosenzweig (eds.), Contractual Arrangements, Employment and Wages i n Rural Labor Markets i n Asia. New Haven: Yale University Press, 1984a. - Binswanger, Hans P., T. Balaramaiah, V.B. Rao, M.J. Bhende and K.G. Kshirsagar. Credit Xarkets ic Rural South India: Theoretical I s s u e s and Empirical Analysis. Uashington, D.C., World Bank, Agriculture and Rural Developmerlt Department, Report No. ARU-45, J u l y 1985. Breman, Jan C. "Seasonal Xigration and Cooperative Capitalism: The Crushing of r Cane and Labor by the Sugar Factorces of Bardoli, South Gujarat." i n H. Binswanger and Y, Rosenzweig (eds.), Contractual Arrangements, Employmenti - and Vases i n Rural Labor Markets i n Asia. Neu Haven: Yale University Press, 1985. Z Geertz, Clifford. "The ~ o t a t i n gCredit Association: A Xiddle Rung i n Development" Economic Depeloprnent and Cultural Chanqe , 10, ( ~ ~1 r i 1962):243. b m Hazell, P e t e r , Carlos Pomareda and Xlberto Valdes (eds.), Crop Insurance f o r Agricultural Develovment Issues and Experience. Baltimore: John Hopkins University Press, 1985. - 33 - DISCUSSION PAPERS AGRllksearch Unit Report No.: ARU 1 A g r i c u l t u r a l Mechanization: A Comparative H i s t o r i c a l P e r s p e c t i v e by Hans P. Binsuanger, October 30, 1382. Report No. : .UU 2 The A c q u i s i t i o n of I z f o r n a t i o n a ~ t dt h e Adoption of Xew Technology by Gershon F e d t r and Xoyer Slade, September 1982. Report No.: ARU 3 S e l e c t i n g Contact F a r a e r s f o r A g r i c u l t u r a l Extension: The Training and V i s i t System i n ilaryana, I n d t a By Gershon Feder and Roger Slade, August 1982. Report No.: ARU 4 The Impact of A t t f t u d e s Toward Xisk on A g r i c u l t u r a l Decisions i n Rural I n d i a by Hans P. Binsuanger, Dayanatha J h a , T. Balaramaiah and Donald 4. ~ i l l e r s ,?fay 1982. Report 80.: .4RU 5 Sehavior and H a t e r i a l Determinants of Production Relations i n A g r i c u l t u r e by Hans P. Binsvanger and Yark R. Rosenzweig, June 1982 (Revised J u l y 22, 1985). Report No.: ARU 6 The Demand f o r Food and Foodgrain Q u a l i t y i n I n d i a by Hans P. Binsvanger, Jaime 9. Quizon and Gurushri Swamy, November 1982. Report No.: ARU 7 P o l i c y I m p l i c a t i o n s of Research on Energy I n t a k e and A c t i v i t y Levels w i t h Reference t o t h e Debate of t h e Energy Adequacy of E x i s t i n g Diets i n Developing C o u n t r i e s by Shlomo R e u t l i c g e r , ?fay 1983. L Report So.: M U 8 ?lore E f f e c t i v e Aid t o t h e Vorld's Poor and Xungry: X Fresh Look at United S t a t e s ?=blic Law 180, T i t l e I1 Food Aid by Shlomo R e u t l i n g e r , June 1983. - Report Yo.: ARU 9 F a c t o r Gains and Losses i n t h e IndiaaSeni- rid Tropics: A D i d a c t i c , Approach t o Xodeling t h e ~ ~ r i c u l t u > aSector l by Jaime B. Quiton and Hans P. ainswanger, September 1983 (Xevised Hay 198h). Report No.: ARU 10 The D i s t r i b u t i o n OF Income i n I n d i a ' s Northern tiheat Region Py Jaime B. Quizon, Hans P. Sinswanger and Devendra Gupta, August 1983 (Revised June 198G). Discussion Papers (continued) Report No.: ARU 11 Population Density, Farming I n t e n s i t y , P a t t e r n s of Labor-Use and Xechanization by Prabhu L. P i n g a l i and Haris P. Binswanger, September 1983. Report No.: AP.U 12 m e N u t r i t i o n a l Impact of Food Aid: C r i t r i a f o r tf.e Selection of Cost- E f f e c t i v e Foods by Shlomo Reutlizger acd Judith Katona-Xpts, Septzaber 1983. S e ~ o r tSo. : .LPU 13 a- P r o j e c ~ :Food Aid and Equitable Growth: Income-Transfer Efficiency F i r s t ! by Shlomo Xeutlinger, August 1983. Report No.: ARU 14 X u t r i t i o n a l I m p T t of A g r i c u l t u r a l Projects: A Conceptual Framework f o r Yodifying the Design and Iinplernentation of P r o j e c t s by Shlomo Reutlinger, August 2 , 1983. Seport No.: .UU 15 P a t t e r n s cf Agricultural Projection by Hans P. Binsvanglr and Pasquale L. Scandizze, November 15, 1983. Report No.: ARU 16 Factor Costs, Incone and Supply Sharas i n Indian Agriculture by Ranjan P a l and 3aime Quizon, 3ecember 1983. Report No.: ARU 17 Behavioral and X a t e r i a l Determinants of Production Relations i n Land Abundant Tropical Agriculture by Hans P. Binsvanger and John XcIntire, January 1984. Seport No.: ARU 18 The Relation Between 7arn Size and F a n Productivity: The Roie of Family by Gsrshon Feder, December 1483. Report Xo.: XRU 19 .A Comparative Analysis of Some Aspects of the Training and V i s i t System - of A g r i c u l t u r a l Exrension i n India - by Gershon Feder ~ n dRoger Slade, February 198a. - s e p o r c - NO.: .ARU 20 D i s t r i b u t i o n a l Consequences of Alternative Food P o l i c i e s i n India * - b y X a n s P . Binswanjsr and Jaime '3. Quizon, August 31, 1984. - Report No.: ARU 21 Income D i s t r i b u t i o n i n India: The Impact of P o l i c i e s and Growth i n the A g r i c u l t u r a l Sector by Jaime 3. Quizon and Hans P. Binswanger, November 1984 (Revised October 1985). EvolucLcn c f Technologies i n T r o p i c a l A g r i c u l t u r e by Prabhu L. P i n g a l i and Hans P. Binswanger, October 17, 1984. Sb3-Saharan A f r i c a by Hans P. Binswanger and Prabhu L. P i n g a l i , October 1385. Report No. : .4RU 24 Population Density and Farming Systems - The Changing Locus of I Innovations and Technical Change by Prahbu L. PingalL and Hans ?. Pinswanger, October 1984. E f f e c t s by G. Feder, R. H. Slade and A. K. Sundaram, November 1984. by Gershon Feder and Xoger Slade, October 1984. I on Western A f r i c a by H a i m S h a l i t and Hans P. Binswanger, Sovember 198; (Revised Yovember 1985). on Production R e l a t i o n s i n Agrarian Economiss by Mark R. Rosenzveig, Hans P. Sinswanger and John X c I n t i r e , Yovember 1985. The Impact of Rural E1ectrifi:ation and I n f r a s t r u c t u r e on A g r i c u l t u r a l Changes i n India, 1966-1980 Sy Douglas F. aarnes and Hags P. 3inswange:, December !984. 1 B e ~ o r tYO.: ARU 30 , . - - - -~.-------- - - - ~~ ( v i t h s p e c i a l empbasis on Africa). A study prepared by the Overseas , Division, Yat i o n a l ~ n s t i t u tof A g r i c u l t u r a l Engineering (OD/NIAE) t by P. J. Seager and R. S. Fieldson, November 1984. Evaluating ~ e s e a r c hSystem Performance and Targeting Research i n Land Abundant Areas of Sub-Saharan Africa by Hans P. Binswanger, January 1955. by .Alastair J. F i s c h e r (Consultant), January 1985. I by J a k e B. Quizon, A p r i l 1985 (Revised August 1985). I ' 1 V i s i c Xethod (T6V) i n Haryana by Cershon Feder, Lawrence J. Lau and Xoger 9. lade, Xarch 1955. Yechanism by Robert Wade, A p r i l 1985 by Robert Wade, A p r i l 1985. I Perf oraance? by Zobert Wade, Yay i9R5. Some Organizations Concerned with .Animal T r a c t i o n Research and Development i n Sub-Saharan A f r i c a by P a u l Starkey, A p r i l 1985. by Jaime B. Quizon and James a a r b i e r i , June i985. I A g r i c u l t u r a l Xechanization and t h e E v ~ l u t i cof~ ~Farning Systems i n Sub-Saharan A f r i c a by Prabhu L. P i n g a l i , Y V ~ SQ i g o t and Hans P. Sinswanger, 3 a y 1985. of "3igiriity,"w i t h p a r t i c u l a r reference t o Taixan - by R h e r Wade, June 1985. . S I, R e ~ o r tNo.: .ARU 42 Adoption of Innovations by . \ l a s t a i r J. F t s c h e r , June 1985. R e ~ o r tNo. : .LPU 43 X Review of t h e L i t e r a t u r e on Land Tenure Systems i n Sub-Saharan Africa by Raymond Noronha, J u l y 1985. Discuss iori "sects. (continued) l e o o r t No. :. ARU 58 ? o f i c y Options f o r Food Security. b i Shlorno .i+uclingcr, J u l y 1985- le3or: No.: .L?U 55 Credit .\iarkcrs i n Xural South India: T3eora:ical Issues and ZxjirFcal Analysis. 5y 3. Sinsvanqer, Y. 3 a l a r ~ n a i a h .7. 3ashkar l a o , X.J. 3hande and L.V. Kashirsagar, J u l y 1985. lalor: No.: .L!U 66 Thz Iapacc sf hgricu. .ural Sxzension: Tht Tzaining and 'Jisi: Sys:ea in India. 57 C~arshorlTeder and Rogar Slade, June 1985. 3eoort Yo. : .UU 57 %chodologicai I s s u e s i n :he Evaluation of Ex=ension I ~ p a c = . by ~ e r s h o nFad.zr and 3oser Slade, J u l y 1985. o r Yo. : .LPU 59 Zs=imacion of hsgresace A ~ r i c u l c u r a lSupply Xesponse. by 3ans 3Lnsvangsr. Yair "undlak, "a-Chens Yang and Alan 3overs Xugusc 1985 (3evised Oczobar 1995). R s ~ o r =No. : M U L9 --A Land Values and Land T i c l e Securi:? in l u r a l Thailand. by Yonqyuch Chalawong and Gershon Zedsr. Junc 1985 (Xsvis5d 0c:abar 1985). legor= Yo.: . U U 50 Land 3 v n e r s h i ~Sacuricy and Capizai F o n a c f o n in l u r a l 3 a i i a n d . 5y ~e rshon' ?eder and Tonsro j Onchag, 3ecesSer 1985 ( l s v i s e d 'ebruary 1396). Xegorr Yo.: .LqU 51 Land Ovnershi? S6cusi:y and ?ag= ?r?cuc:ivi::: i n Xurai 3ai;and. by Gcrshon 'eder, April 198E. . Xe?or= No.: .UU 52 S o c i a l and Culcural XsTnc:s of Lzr.6 Ixheritance and :ransac:lons In =ural Thailacd. 5 : ~Charles 3. " e l l , :une laq6.