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In the LSMS data for Nepal most agricultural laborers report daily wages, while econometric analysis on the data indicates that, for many villages, the laborers actually have long-term contracts. We have visited some of the villages to solve this puzzle. We find that in some cases the daily wages are actually part of attached labor contracts that are not reported in the LSMS data. We go on to describe the variation in benefits and threats landlords apply to keep the laborers at a wage below the competitive wage, and we discuss a policy implication of the misrepresentation of data.

Magnus Hatlebakk

Senior Researcher; Coordinator: Poverty Dynamics