We collaborate with the NGO BRAC in Uganda to induce variation in tenancy contracts. BRAC leases plots of land to women from low socio-economic backgrounds who are interested in becoming farmers and provides them with agricultural training and a package of seeds for cultivation. In all villages, tenant farmers are contracted for one season under a sharecropping contract that gives them a 50% stake in the output. After signing the contract, villages are randomized into three groups. In the first group (Control), the contract is maintained -- i.e. tenants keep 50% of their output. In the second group (T1), tenants are offered to keep 75% of the output. Tenants in a third group (T2) keep the same output share as in control (50%) but receive an additional fixed payment which is independent of their output level, paid at harvest and announced at the same time as T1 received news of the higher share. Within this third group, half of the tenants (T2A) receive it as a risk-free cash transfer while the other half receive part of their additional payment as a lottery (T2B), the expected payment in T2A and T2B being the same. The plots are visited pre-harvest to measure output levels and crop choice; and all tenants are surveyed shortly after the harvest to record their input use, such as labor, fertilizer, and tools.
The experiment is implemented across two agricultural seasons of 2014, spanning from March to July (Season 1) and September 2014 to January 2015 (Season 2). In both of these seasons the plots are advertised under a 50% sharecropping contract, and the tenants sign that contract during the first training session. The contract is valid for 1 season only. Tenants sign that contract at the start of the agricultural season.