Farm exits and competition on the land market: Evidence from spatially explicit data

Dieter Pennerstorfer

No 2022-09, Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria

Abstract: In this article, we analyze competition for agricultural land as an important, scarce and immobile input. The cost of cultivating a parcel of land depends strongly on the distance from the farmer to the plot, leading to spatially small land markets. To investigate this issue, we are able to use extremely rich datasets, and combine information on both farms and their cultivated plots (including their exact locations) for virtually all farms in Austria for a five-year period. When analyzing the takeover of parcels from farms leaving the market, we find that the distance between an exiting farm’s plot and the closest parcel of a prospective buyer farm is an important determinant of which buyer will prevail on the land market. In addition, the proximity between the farmsteads of the exiting farm and a prospective buyer farm is also important. The results suggest (i) that agricultural land markets are indeed very small and (ii) that information frictions are important in this market.

Keywords: spatial competition; land market; farm exit; spatial data (search for similar items in EconPapers)
JEL-codes: L13 L25 Q12 R14 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2022-06
New Economics Papers: this item is included in nep-agr and nep-com
Note: English
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.econ.jku.at/papers/2022/wp2209.pdf (application/pdf)

Related works:
Working Paper: Farm exits and competition on the land market: Evidence from spatially explicit data (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jku:econwp:2022-09

Access Statistics for this paper

More papers in Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria Contact information at EDIRC.
Bibliographic data for series maintained by René Böheim ().