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The Spatial Structure of Farmland Values: A Semiparametric Approach

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  • Wang, Haoying

Abstract

Controlling for spatial heterogeneity and spatial dependence in farmland valuation models has gained substantial attention in recent literature. This paper proposes to derive the spatial structure of farmland values endogenously and semiparametrically based on the spatial competition theory. The paper assembles panel data of Pennsylvania county level farmland values between 1982 and 2012. A spatial autoregressive panel data model with spatial weights matrix endogenously incorporated is estimated. Out of sample predictions and non-nested statistical tests for model selection suggest that the fit and the predictability of hedonic farmland valuation models can be greatly improved.

Suggested Citation

  • Wang, Haoying, 2018. "The Spatial Structure of Farmland Values: A Semiparametric Approach," Agricultural and Resource Economics Review, Cambridge University Press, vol. 47(3), pages 568-591, December.
    • Handle: RePEc:cup:agrerw:v:47:y:2018:i:03:p:568-591_00
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    References listed on IDEAS

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    1. Lee, Lung-fei & Yu, Jihai, 2010. "Estimation of spatial autoregressive panel data models with fixed effects," Journal of Econometrics, Elsevier, vol. 154(2), pages 165-185, February.
    2. Joris Pinkse & Margaret E. Slade & Craig Brett, 2002. "Spatial Price Competition: A Semiparametric Approach," Econometrica, Econometric Society, vol. 70(3), pages 1111-1153, May.
    3. Manfred M. Fischer & Arthur Getis (ed.), 2010. "Handbook of Applied Spatial Analysis," Springer Books, Springer, number 978-3-642-03647-7, June.
    4. Charles B. Moss, 1997. "Returns, Interest Rates, and Inflation: How They Explain Changes in Farmland Values," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1311-1318.
    5. Haixiao Huang & Gay Y. Miller & Bruce J. Sherrick & Miguel I. Gómez, 2006. "Factors Influencing Illinois Farmland Values," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 458-470.
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    1. Marques, Felipe César & Telles, Tiago Santos, 2023. "Spatial effects are determinants of agricultural land prices in Brazil," Revista de Economia e Sociologia Rural (RESR), Sociedade Brasileira de Economia e Sociologia Rural, vol. 61(3), January.
    2. Wang, Haoying, 2018. "An Economic Impact Analysis of Oil and Natural Gas Development in the Permian Basin," MPRA Paper 89280, University Library of Munich, Germany.
    3. Vasco Capela Tavares & Fernando Tavares & Eulália Santos, 2022. "The Value of Farmland and Its Determinants—The Current State of the Art," Land, MDPI, vol. 11(11), pages 1-14, October.
    4. Wang, Haoying, 2020. "The economic impact of oil and gas development in the Permian Basin: Local and spillover effects," Resources Policy, Elsevier, vol. 66(C).

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