ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Farm Size and Productivity in Bangladesh Agriculture

This paper explains the relationship between farm size and productivity in Bangladesh agriculture by analysing the transaction costs of employing labourers in a high (Madhupur) and a low (Chandina) potential area. In Madhupur, labourers are hired for task specific operations whereas in Chandina they are hired on a daily wage basis. Thus larger farms in Madhupur can employ labour at low transaction costs and hence output per acre is higher as compared to smaller farms. In Chandina, the quality of supervision performed by family labourers falls as farm size increases and hence output per acre is lower as compared to smaller farms.

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