The Market for Land and the Impact of Farm Programs on Farm Numbers

Abstract

If a land price is to be observed, there must be trades of land. If the aggregate quantity of land in agriculture is fixed, those trades must be among farmers. This paper presents a model in which farmers of differing "ability" trade land among themselves. The model is used to evaluate the impact of farm programs (a demand enhancement program; a price support program; a land retirement program; an income subsidy program) on output price, land price, and number of farmers. Effects of these programs depend on conditions that require empirical evaluation. Preliminary evidence suggests that some standard tools of farm policy have the effect of reducing farm numbers.

Capitalization of Government Support in Agricultural Land Prices: What Do We Know?

“…A number of papers have re‐examined Floyd's results in alternative ways or extended them by relaxing restrictive hypotheses of Floyd's model and/or including various alternative policy instruments in order to compare their respective effects (e.g. Gardner, 1987; Hertel, 1989, 1991; Leathers, 1992; Dewbre et al , 2001; Dewbre and Short, 2002; OECD, 2002; Guyomard et al , 2004). Usually, however, although analytical results are much more complicated and effects of policy instruments more difficult to disentangle, interpret and sign, main insights from Floyd's model do remain.…”

Government Payments and Farm Business Survival

“…Economists and policy makers have long been interested in how government payments influence the growth and survival of farm businesses (e.g., Leathers, 1992;Tweeten, 1993;Atwood, Watts, and Baquet, 1996;Huffman and Evenson, 2001). With government payments to farmers exceeding $20 billion in 1999, 2000, 2001, and 2003, farm payments have received greater public scrutiny, with some maintaining that payments unfairly advantage large operations (e.g., Williams-Derry and Cook, 2000;Becker, 2001).…”

Politique agricole en France et prix de la terre

“…Les agriculteurs sont, pour cette raison, incités à acheter ou à accroître par le louage leur superficie en terres labourables afin de maintenir leur production et d'augmenter le montant des aides. Le gel des terres augmente donc le prix des terres labourables (Leathers [15], p.83). Il favorise, de plus, une forme d'intensification relativement insidieuse au regard des objectifs de qualité de l'environnement rural.…”

“…Elles s'adressent aux exploitants agricoles qui s'engagent à respecter un cahier des charges défini et approuvé par la Commission européenne ou les régions. Elles prennent huit formes différentes: 1) protection des eaux 12 , et 2) réduction d'intrants polluants, 3) reconversion des terres arables, 4) conversion en agriculture biologique 13 , 5) diminution du chargement de cheptel bovin ou ovin 14 , 6) protection des races menacées, 7) retrait de toute culture afin de protéger la faune et la flore 15 , 8) mise en place d'opération locale 16 . La description de chacune de ces mesures serait un travail fastidieux.…”

“…14 La diminution de la charge d'ovin ou de bovin à l'hectare permet de lutter contre les phénomènes de déprise agricole dans les zones sensibles. La collectivité verse à ce titre 1500 francs par unité de gros bovins (UGB) 15. Le retrait de toute culture sert à conserver la diversité de la flore et à valoriser la faune sauvage.…”