Availabledataonthefrequenciesofescap,coveringfourprovincesinChinain1935,revealsthattheescapeclause(asincontractsamplesaandc)wasadoptedin83percentofthecrop(fixed)rentcontracts,63percentofthecash(fixed)rentcontract,andnotatallinsharecontracts.[10]Thehigh,themarketpriceofagriculturalyieldwillrise,andwithcashrentthetenantsinewillbepensatedbytheriseinpricemorethanwithcroprent;hence,theescapeclausewillbelesspreferabletothetenant.
Theexistenceoftheescapeclauseinthemarketimplies,otherthingsbeingequal,,beforetheagrarianreforms,,however,,inpart,,thefermiersoftheFrenchmetayage,theescapeclauseassociatedwithfixedrentsinChina,andtheminimumguaranteesassociatedwithsharerentselsewherearemarketpracticesthatservea,tionIdonotseektoanswer.
TurningtosamplecontractsofsharerentsinChina,wefindthattheirstipulationsaremoreplexthanthoseoffixedrents,owingtotheaddedstipulationsontenantinputsandcropstobegrown.
Sampled-sharecontractwithuniformsharingpercentagesforallcrops(ShantungProvince):
TenantAagreestocultivate[somanymows][somanyhead]ofwaterbuffalo,[somanybodies]ofmen;andeveryyearthetenantmustcultivatewheatonce,Indiancornthreetimes,[incertainproportions].Theyieldsofallcropsaretobeshared[incertainproportions].Theleasemayterminateonlyaftertheautumnharvest.[11]
Samplee-sharecontractwithvaryingsharingpercentages(HonanProvince):
[Stipulationsoflandsizeandnonlandinputs]……Weherebystipulatethatthewheatyieldwillbesplit20-80;millet,yellowbeans,sesame,greenbean-allwillbesplit30-70;cottonandsweetpotatoessplit50-50……;milletstraws,andbeanandsesamestalkssplit30-70.[12]
Samplef-sharecontractwithsomeproductsunshared(HonanProvince):
TenantA……voluntarilyagreestofurnish[somany]men,[somanyhead]ofwaterbuffaloanddonkeys……andallplowingequipment……Weclearlystipulatethatseedsofmajorcropsaretobeprovidedbythelandowner,,indryandcleanform……Butthestrawsgotothe[tenants]waterbuffaloentirely;thedroppingsgotothe[landowners]soil;……[bythelandowner],[13]
Forsharecontracts,,theexplicitstipulationsoftenantinputsandcropplantationsareimpliedbythetheoryofsharetenancy(seechapter2).[14]Evidenceindicates,however,thatonlytheactualyieldsareinspected,forbyparisonwithadjacentfarmsorpastexperiencethelandownerwillbeabletodecidewhetherthecontractedtermshavebeenfulfilled:
Theabsenteelandlordssendtheiragents,orgothemselves,tothefieldsandestimateth……[Thetenant]monlycheatsbyskilfullyhidingsomeofthethreshedgrain,ftenhastobribehiminordertokeepthelandforcultivationanotheryear.[15]
Exaggeratedasthisquotationmightbe,anintramarginaltenantwithspecificfarmingknowledge(hence,withhigheryieldsthanmarginaltenants)can”hide”asmuchastherentimputedtohisspecialskillandstillretainhistenancy;anagentcancollectenforcementcostin”bribes”,thisjustifiesmyclaimthattransactioncostishigherforasharecontractthanforfixedrent.
Asecondcharacteristicofsharecontractsisthatthepreciseandattimesplexdelineationofresourcerightsbetweenthecontractingpartiessuggeststhatthesharingofinvestmentinputscan,inchapter2:Thelandownermayeitherrequirethetenanttoinvestmoreinlandandchargealowerrentalpercentage,orthealannuity.