In order to alleviate acute poverty and vulnerability in the absence of sufficient employment opportunities both in the farm and non-farm sectores, the landless agricultural laborers of West Bengal have a tie with the landlord in an interlinked contract, where the land market is linked up with the labor market. This type of interlinked contract is a new version of Employer's risk hypothesis. A landless agricultural laborer will be inclined to bind himself with such an interlinked contract at the beginning of each year provided he has a large family labor force, and a regular savings habit. But he will not be inclined to such a contract if he gets sufficient employment in terms of man days either in the farm or non-farm sector in his locality. If he enters into such a contract, then the total size of land he has to take on lease from the landlord prior to the agricultural season is positively related to the total number of able-bodied family labor force. This paper also explains that the interlinked contract, besides abating poverty of the landless agricultural laborer, also reiterates the importance of land reforms for poverty eradication.

Interlinkage is generally defined to be a situation where we observe the simultaneous existence of two contracts between the same pair of economic agents. The two contracts exist in a form so that the existence of one is contingent upon the existence of another. The problem of interlinkage is widely known in the agricultural labor market of the under developed countries. Bardhan and Rudra (1978) during their village level survey observed the existence of labor-cum-credit contracts in many villages of West Bengal. According to them, workers were employed in the peak season after being offered consumption loan in the lean season at subsidized rates of interest. Two important theoretical explanations of the credit-labor interlinked contract were developed by Basu (1985) and Bardhan (1984). Basu explained the interlinked contract in the light of the Lender's risk hypothesis and Bardhan explained it in the Employer's risk hypothesis. According to them, the landlord presumes that there may be excess demand for laborers during the time of the agricultural peak season, i.e., during the time of sowing, transplanting or harvesting. To remove this uncertainty, the landlord provides consumption loan to the laborers on the basis of their pre-commitment to work in his field in the next peak season. Actually by binding an indebted laborer into an interlinked contract, the landlord has the opportunity to ensure repayment of the loan from the wage income of the interlinked worker. Sarap (1991), in his intensive village level survey in Sambalpur district, observed that the agricultural laborers mainly took loans from the landlords for consumption purposes and worked in the landlord's field in the next peak season. Gupta (1987) explained this interlinkage on the basis of the lagged consumption efficiency argument. According to him, due to lagged consumption efficiency relationship, the landlord prefers to give consumption loan to the laborer in the agricultural slack season on the basis of his commitment to work in his field in the next peak season. This helps the farmers to get more nourished worker when the agricultural activity is going on. Kundu and Chatterjee (1998) showed that this type of interlinkage would be possible if, and only if, the landlord can force the laborers to eat food only at his residence. This can only check the moral hazard problem, which may arise in this nutrition-based credit-labor interlinked contract. It must be remembered that such interlinked contracts are usually observed in the village economy where legal enforcement of the contracts are virtually non-existent. Most of the contracts are oral in nature and sustained by custom and mutual trust.

Nowadays, a new type of interlinked contract is emerging in the agricultural labor market. Here, too, the contract is between the landlord and the laborers; but instead of credit, the land market is tied with the labor market. In this interlinked contract, the landlord leases out small portions of land to the agricultural laborer and his household under fixed rent for one year on the basis of his verbal commitment that he would work in the landlord's field in the next agricultural peak season. Here, the agricultural laborer cultivates land with the help of his family labor force and after repaying the rent to the landlord either keeps the remaining crop for self-consumption or sells it in the market. This type of interlinked contract can be identified as the new version of Employer's risk hypothesis previously developed by Bardhan, as here, instead of credit, the landlord wants to lease out small portions of his land to the agricultural labor household for one year. Here also it is presumed that cultivators as well as landlords facing scarcity of agricultural labor, particularly during the time of sowing, transplanting or harvesting, want to lease out few plots of land to the laborer in order to ensure their availability during peak time. Only local casual landless agricultural laborers get tied in this contract.

The present study is an empirical exercise designed to identify some of the important factors that contribute to the main agricultural laborers as well as the farmers entering into a tenancy-labor interlinked contract. We will also identify the factors which determine the size of land a main agricultural laborer wants to take on lease prior to any agricultural season after tying himself in such an interlinked contract.

Causes and Consequences of Tenancy-Labor Interlinked Contract in the Agricultural Labor Market of West Bengal, alleviate acute poverty, vulnerability, family labor force, regular savings habit, Bardhan and Rudra, labor-cum-credit contracts, tenancy-labor interlinked contract.