Foranyresource,,;[6],petitionconglomeratesknowledgefromallpotentialowners-theknowledgeofalternativecontractualarrangementsandusesoftheresource;,petitionamongpotentialcontractparticipantsandaresourceowner',,,thatstateofresourceallocationunderwhichitisnolongerpossibletoreallocateresourcestobenefitoneindividualwithoutanother'slosing（thatis,theParetocondition）,however,resourceallocationinconformitywiththeParetoconditionneednotsatisfythesamesetofmarginalequalities.[7]Althoughitisdifficult,ifnotimpossible,toseparateonetypeoftransactioncostfromanother,;thatis,,withtransactioncoststheremaynotexistauniformfactorpriceinthemarket,andthebuyer'spricemaydifferfromtheseller',;thatis,-sumpaymentfortheuseofaresource,,alandowner,inlettinghisscarcewaterresourcetoatenant,（throughmeteringorotherdevices）issohigh（owingto,say,thephysicalattributesofwater）astomakealternativearrangementsinefficient.[8]Underthisformofcontractualpayment,thewaterresourcewillbeusedbythetenantuntilitsmarginalproductiszero,,,ifthegainfromchoosinganothercontractualarrangement（e.g.,acontractwithaunitpricechargedonwater）hadbeengreaterthanthecostofquantifyingtheuseofwater,somemeteringdevicewouldhavebeenadoptedandthecontractwiththelump-sumpaymentabandoned.[9]

Efficientallocation,therefore,,,the"highest-valuedoption",theytendtoreducethevolumeoftransactions,,theymayaffectmarginalequalities（andintensities）,;namely,afixed-rentcontract（rentperacrestatedincashorincrop）,asharecontract,,,sharecontractsweremorefrequentthanfixedrentsinTaiwanandSoutheastAsiabeforetheagrarianreforms;inChinafixedrentsweremorefrequentthansharerentsinthe1930s;inJapan,fixedrentspredominated;andingeneral,wagecontracts（farmhands）havebeeninfrequent,oc-curinginabout1to5percentofthefarminghouseholdsinvariouslocalities.[10]Whydothepatternsofcontractualchoicesdiffer?Whatdeterminesthechoiceofcontracts?