Exploring long-term land improvements under land tenure insecurity

Abstract

This article explores long-term land improvement (lime application) under land tenure insecurity on leased land. The dynamic optimisation problem is solved by a stochastic dynamic programming routine with known parameters for one-period returns and transition equations. The model parameters represent Finnish soil quality and production conditions. The farmer's decision rules are solved for alternative likelihood scenarios over the continuation of the fixed term lease contract. The results suggest that, as the probability for non-renewal of the lease contract increases, farmers quickly decrease investments in irreversible land improvement and, thereafter, yields decline gradually. The estimated decision rules are a part of larger set of farmer's decision rules to be taken care when land leasing and environmental legislation is renewed.

Determinants of agricultural land values in Argentina

“…Despite the fact that the non-owner forms of land management achieved high professional standards and productive efficiency of land, farmers still assign greater value to traditional forms of production management by landowner-cultivators. This result is consistent with previous empirical research, which supports conventional expectations that owner-operators are attentive to the long-term value of their land and thus are more likely to adopt conservation practices than renters 9 (Abdulai et al, 2011;Kabubo-Mariara, 2007;Myyrä et al, 2007;Soule et al, 2000). This careful land management is obviously valued in farmers' opinions about land values.…”

“…Attention has recently been paid in the literature to the value of the biophysical attributes of land, suggesting that land values may vary with potential environmental contamination (Boisvert et al, 1997), soil exhaustion and degradation (Sills and Caviglia-Harris, 2009), and the cropping history of the plot (de la Fuente et al, 2006). Another strand of literature emphasizes the implications of land tenure on fertilization, adoption of conservation practices, and longterm land improvements (Abdulai et al, 2011;Myyrä et al, 2007;Soule et al, 2000). However, the extent to which different tenure modes are reflected in land values has not yet been examined.…”

Yield response models to phosphorus application: a research synthesis of Finnish field trials to optimize fertilizer P use of cereals

“…For soils with medium STP Sippola and Marjanen (1978) suggested no P application, in agreement with our results. In contrast, according to Myyrä et al (2007), optimum P rate would be as high as 18 kg ha -1 on fine-and medium-textured mineral soils with medium STP, even when the P and yield prices are 1.2 € kg -1 and 110 € tn -1 , respectively. The high optimum suggested by Myyrä et al (2007) was based on the Mitscherlich yield response model, but their database was considerably smaller than ours.…”

“…In contrast, according to Myyrä et al (2007), optimum P rate would be as high as 18 kg ha -1 on fine-and medium-textured mineral soils with medium STP, even when the P and yield prices are 1.2 € kg -1 and 110 € tn -1 , respectively. The high optimum suggested by Myyrä et al (2007) was based on the Mitscherlich yield response model, but their database was considerably smaller than ours. In addition, their model also included an additional requirement that soil P status remains at a steady-state, and this cannot be obtained unless P is applied in excess of the crop's uptake.…”

Are preserved farms actively engaged in agriculture and conservation?

“…Soule (2001) found that renters were less likely than owner-operators to implement two out of ten nutrient and soil management practices. 7 Using mathematical simulation, Myyra et al (2007) found that irreversible land improvements decline as a result of uncertainty in lease contract renewal.…”