Vayikra 25:4-18 (Behar): Equality vs. efficiency

Vayikra 25:4-18 records the laws of the special years, shemitta and yovel. Regardless of the rationale for the laws, what are the implications of the laws? One implication is that the resting of the land and opening it to all people would have increased the level of equality in society. The landowners would harvest less of their fields while the poor would have a greater opportunity to work to obtain food. However, almost inevitably when there is an increase in equality there is a loss of efficiency and the resting of the land is no exception to this rule. The loss of efficiency is that fewer crops would be produced in the shemitta and yovel years because the land was to lie fallow, and an untended field will be less productive than a cultivated field.

There are possible gains in efficiency from the resting of the land. One, as mentioned by the Rambam (Moreh 3:39) the resting of the land could be considered a form of crop rotation. Buchholz (1988) suggests that maybe the shemitta year increased the capital stock by forcing people to save in the intervening six years. However, as noted by Soss (1975) most of the savings would be for food, which would literally be eaten in the 7th year. Soss (p. 338) suggests a different possibility, that as one could not work in the fields during the year, this would free time which “would act to stimulate technical inventiveness and innovation.” One other consideration is that the loss of production in the seventh year would naturally have been partially offset by people working harder in the six intervening years to compensate for being unable to work in the seventh year. In fact, one could understand the verses that introduce the shemitta year as obligating a person to work in the intervening years. Thus, Shemot 23:10 and Vayikra 25:2 record, “For six years you are to sow your land (Fox translation).” (Note this idea could also apply to the Shabbat, see Shemot 20:9 and Devarim 5:19.) Yet, notwithstanding these possible gains in efficiency, it seems very unlikely that they would be greater than the loss of the produce that was forgone in the shemitta and yovel years.

The return of the ancestral land in the yovel year also relates to the tradeoff between efficiency and equality. When the people would return to their ancestral fields this would decrease the inequality in society since each person would have the opportunity to start over again and there would be an increase of the assets of the poor people. Yet, with the return of the land, there is less incentive for a buyer to develop the land in the intervening 49 years. Buchholz (p.422) also argues that the subdivision of plots “limits the ability to exploit economies of scale” by the farming. Yet, unless there are large transaction costs, this problem could be surmounted since adjacent farmers could work together to attain economies of scale.

There are some potential gains in efficiency from the return of the land. While one generation might have worked hard to become wealthy and accumulate large tracts of land, the continued possession of the land by future generations could reduce the level of competition in the economy. The inheritors of the land might tend to “satisfice” as opposed to maximizing the value of the fields. The redistribution of the land means that the descendants of the previous large landowners would have to re-earn their wealth, and the people who returned to their ancestral land would have resources that would enable them to compete. Accordingly, by the return of the land in the Jubilee year, there is a gain in equality and it is possible that the increase in opportunities would lead to an increase in efficiency.