Abstract

This paper suggests an evolutionary model to account for the bargaining process in transitional economies leading to the emergence of formal and informal agreements between landowners who for whatever reason are not willing to farm and landless who are willing to cultivate land. In particular, each agent from each population presumes to be matched with an agent from the opponent population only once a period by assuming his opponent not to reach instantaneously to the environment, he observes the strategy that better worked for agents of his population in the previous period, and he experiments with some probability towards an agrarian contract which is alternative to the prevailing one in the current period. The bargaining process in East and Central European as well as the former Soviet Union countries is refereed to and an empirical validation based on data from a farm survey carried out in Romania is provided.