A Methodology for Predicting U.S. Farm Real Estate Price Variation

Tweeten, Luther G.; Martin, James E.

doi:10.2307/1236229

Cited by 45 publications

(34 citation statements)

References 2 publications

(1 reference statement)

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“…Other authors, such as Tweeten and Martín [53], Reinsel [38], Reinsel and Reinsel [39], Doll et al [14], Just and Miranowski [26], and Weersink et al [55] investigated the impact of public policy on land price. For example, Reinsel and Reinsel [39] observed that the present value of the land earnings stream, farm credit, the interest rate, and the inflation rate acted as land price determinants.…”

Section: Conceptual Frameworkmentioning

confidence: 99%

Sugarcane expansion and farmland prices in São Paulo State, Brazil

et al. 2018

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Background: Brazil is the world's largest sugarcane producer, and its production is concentrated in south-central and northeast regions, particularly in the state of São Paulo. The land use change, principally from the increasing sugarcane production, may reflect in the farmland prices. The aim of this study is to evaluate the extent to which agricultural land prices in São Paulo are determined by variations in cultivation and prices of three products that represent a significant share of agriculture in the state: sugarcane, soy and corn, in a low-inflation environment. Methods:Analysis is based on data from the Rural Development Offices (EDR) from 1997 to 2013. A simple panel data model is constructed with land price as the dependent variable, subdivided, according to the definition of the São Paulo State Institute of Agricultural Economics, into first-and second-class croplands. Cultivation area, unit price of the products, and lease value are explanatory variables, according to each crop. Inflation and the overall production value of São Paulo's farming production, excluding the production values of corn, soy and sugarcane, also serve as explanatory variables. Results:The results show that in São Paulo, although part of the land price variation can be explained by the variables associated with their productive use, the impact of inflation indicates that land's function in storing value contributes significantly to land prices. Conclusions:The most prominent conclusion is that expansion in sugarcane cultivation has led to higher farmland prices in the state of São Paulo.

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Section: Conceptual Frameworkmentioning

confidence: 99%

Sugarcane expansion and farmland prices in São Paulo State, Brazil

et al. 2018

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“…Agricultural Land Prices Studies: The Hedonic Pricing Technique There is a large volume of literature using time-series approaches to analyse aggregate average land prices in the agricultural land market. These studies include simultaneous equation models (Reynolds and Timmons, 1969, Tweeten and Martin, 1966, and Herdt and Cochrane, 1966, single equation models (Traill, 1979) and asset pricing models (Melichar, 1979, Burt, 1986, Featherstone and Baker, 1987, Lloyd and Rayner 1990, Lloyd et al, 1991, and Falk, 1991. Whilst these studies have helped to explain the movement of agricultural land prices through time, aggregate prices conceal considerable inter-parcel variation in prices within the agricultural land market.…”

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confidence: 99%

Spatial Effects within the Agricultural Land Market in Northern Ireland

Patton

McErlean²

2003

J Agricultural Economics

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The importance of dealing properly with spatial effects, such as spatial autocorrelation, in cross‐sectional econometric estimation has become more widely recognised in recent years. Spatial autocorrelation is similar in many ways to serial correlation, but while the latter is ordered on a one‐dimensional time axis, the former is ordered in two dimensions. The multi‐directional nature of spatial dependence means that specialised techniques are needed for diagnostic testing and estimation purposes. This paper uses these specialised diagnostics to test for spatial effects within a hedonic pricing study of the agricultural land market. The tests indicate that spatial autocorrelation (in the form of spatial lag dependence) and spatially distinct sub‐markets (or spatial heterogeneity) are present. Ignoring these effects in the estimation process is likely to lead to biased parameter estimates. Consequently, we re‐specify the hedonic model to allow for these spatial effects. The presence of spatial lag dependence suggests that there is circularity of price setting within the agricultural land market. This means that agricultural land prices are not solely determined by the inherent characteristics of the land, but tend to reflect also the average local price per acre.

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“…The capitalization of government programs into land prices has also been discussed in the literature [12][13][14][15][16]. Tweeten et al [14] concluded that pressures to increase farm size and the capitalized benefits of farm programs could explain 52% of the variation in land prices. Traill [17] notes that capitalizing the full benefits of a support program will not affect net farm income in the short-run.…”

Section: Literature Reviewmentioning

confidence: 99%

Did the Federal Agriculture Improvement and Reform Act of 1996 Affect Farmland Values?

Mishra

Livanis

Moss

2011

Entropy

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Abstract:Farmland values are affected by numerous factors, including farm policy, shifts in demand for agricultural output both foreign and domestic, monetary policy and urban pressure. In this study we use an information measure to examine whether the shift toward a more market-oriented policy in 1996 changed the relationship between farmland values and government payments. The results indicated that the shift in agricultural policy resulted in significant shift in this relationship.

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A Methodology for Predicting U.S. Farm Real Estate Price Variation

Cited by 45 publications

References 2 publications

Sugarcane expansion and farmland prices in São Paulo State, Brazil

Sugarcane expansion and farmland prices in São Paulo State, Brazil

Spatial Effects within the Agricultural Land Market in Northern Ireland

Did the Federal Agriculture Improvement and Reform Act of 1996 Affect Farmland Values?

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