Publication: Colonos, central factories, and renegotiation:
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1992-09
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Abstract
This paper focuses on the relationship between technical and
institutional changes in Cuba a leader in the use of continuousprocess
technologies being applied to cane sugar manufacture in
the first three decades of the twentieth century. Using a fixed
effects model of the sugar manufacturer's decision to invest in
new technologies, we show that a change in institutional factors
had an impact on the adoption of the new technologies. The
results show that differences in cane contracting arrangements
affected the ease with which mills adopted new technologies.
These differences were based on historical factors in the
evolution of the cane farming institution in Cuba that affected
whether the cane lands were the property of the farmer or the
mill. This distinction created differences in the cane farmers'
bargaining positions in the renegotiation of contracts with the
mill, and it resulted in variation in the long-run costs of
procuring cane at different mills.
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Economic History, Institutional Economics, Vertical integration, Economics of technology