PT  - JOURNAL ARTICLE
AU  - Tione, Sarah E.
AU  - Holden, Stein T.
TI  - Nonconvex Transaction Costs and Land Rental Market Participation in Malawi
AID  - 10.3368/le.98.1.062620-0092R
DP  - 2022 Feb 01
TA  - Land Economics
PG  - 150--164
VI  - 98
IP  - 1
4099  - http://le.uwpress.org/content/98/1/150.short
4100  - http://le.uwpress.org/content/98/1/150.full
SO  - Land Econ2022 Feb 01; 98
AB  - We assess how nonconvex transaction costs constrain access to and participation in the land rental market by smallholder farmers in sub-Saharan Africa. The theory suggests a dynamic externality due to such transaction costs and that orchestrated participation can reduce such costs and enhance future participation. We use dynamic random effects probit and Tobit models with balanced panel data from Malawi to assess participation on the tenant side of the market. We observe that initial and earlier land rental market participation significantly increases participation in the subsequent years, consistent with dynamic nonconvex transaction costs and possible entry barriers in the market.