This paper provides new perspectives on USA landlord–tenant contracting, where technical change is creating scale economies in farming and farm enlargements, and results that are important to the sustainability of land use and environmental quality. We develop a conceptual model of landlord–tenant contracting that emphasizes minimizing transactions costs and setting incentives for effort when t...

Corrective taxation is a common approach to addressing externalities, internalities, and other market distortions. These distortions are often heterogeneous: for example, some cars pollute more than others, and many people consume alcohol “rationally’’ even as present biased individuals might over-consume. Such heterogeneity raises the question of whether a corrective tax is “well-targeted’’: d...

* Subject to the usual disclaimer, the authors would like to thank an anonymous referee of this journal for helpful comments and suggestions. ABSTRACT: The literature on interlinkage is inconclusive regarding the strict superiority of this arrangement. We analyze a landlord and a moneylender as two players making non-cooperative decisions regarding the terms of their respective contracts with a...

Traditional and standard discounted cash flow valuation techniques are unable to deal with a variety of options contained in lease contracts. In the UK, the most important embedded option is the upward-only rent review. This becomes more valuable to the landlord in an era of low inflation, as nominal market rents are more likely to fall. Lease contracts are freely negotiated between landlord an...

We show that the effect of eviction threats on unobservable investment effort can be positive. We demonstrate this apparently counter-intuitive result in a model of tenancy where investment by a tenant in the current period raises the chances of doing well in the next period, and therefore retaining the job in the period after next period. If the tenant earns rents, the landlord can partly subs...