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The lack of land ownership can discourage agricultural technology adoption, yet there is scarce evidence of the impact of land rental contracts on the adoption of improved crop varieties in developing countries. The current study investigates such impact using a nationally representative survey of Ethiopian maize farmers. In contrast to many previous studies, we show in a simple model that cash-renters are as likely to adopt improved maize varieties as owner-operators, while sharecroppers are more likely to adopt given that such varieties are profitable. Empirical analysis reveals a significant impact of sharecropping on improved maize variety adoption, and no significant impact from cash-rental, lending support to the above hypotheses. These results imply that improvements in land rental markets can potentially enhance household welfare through crop variety adoption in agrarian economies where land sales markets are incomplete or missing.
