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A Partial Budget Approach to Estimating Cash Rents

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  • Ibendahl, Gregory A.

Abstract

Because of the extra risk, tenants who cash lease land should earn more money than those tenants with share leases. A competitive land market and the need to support bigger and newer machinery can easily lead tenants to pay more than they should for a cash lease. Share leases tend to avoid the overpayment problem as the share percentage is usually relatively fixed. Since share leases are not always available, this paper presents a way for tenants to determine if a cash lease rate is reasonable for the area by using a partial budget approach that compares lease types.

Suggested Citation

  • Ibendahl, Gregory A., 2010. "A Partial Budget Approach to Estimating Cash Rents," Journal of the ASFMRA, American Society of Farm Managers and Rural Appraisers, vol. 2010, pages 1-5.
  • Handle: RePEc:ags:jasfmr:96412
    DOI: 10.22004/ag.econ.96412
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    Keywords

    Financial Economics;

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