Investors' impact on Czech farmland prices: a microstructural analysis. (21st November 2020)

• Record Type: Journal Article
• Authors: Curtiss, Jarmila; Jelínek, Ladislav; Medonos, Tomáš; Hruška, Martin; Hüttel, Silke
• Is Part Of: European review of agricultural economics. Volume 48:Number 1(2021)
• Page Start: 97
• Page End: 157
• Publication Date: 2020-11-21
• Subjects: farmland markets -- bargaining power -- non-agricultural investors -- stochastic frontier analysis -- metafrontier; Agriculture -- Economic aspects -- Periodicals; Agriculture -- Economic aspects -- Europe -- Periodicals; 338.109405
• DOI: 10.1093/erae/jbaa029
• Languages: English
• ISSNs: 0165-1587

Abstract

Abstract: This paper analyses farmland price formation under investors' increased demand in the Czech Republic from 2008 to 2014. We adopt a stochastic metafrontier approach to hedonic price modelling and investigate the relative differences in farm and investor pricing. Our results provide evidence of buyer group-specific land valuations, asymmetric price dispersions and their temporal changes. These changes reflect the developments of market microstructures and market-supporting institutions induced by buyer competition. While initially significantly lower due to high market and bargaining power, prices paid by corporate/cooperative farms converged with high-level investor prices over time. Individual and family farms were largely unable to compete at the new price levels.