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The role of farmers’ competition on farmland price in local markets: Bretagne region of France

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  • Temesgen, Chalachew
  • Dupraz, Pierre

Abstract

We introduce the local farmland market concepts in order to understand the operation of French farmland sale market. We perform an empirical analysis of farmland prices based on farmland sale market in the Bretagne Region of France. The descriptive statistics show that the price of farmer to farmer transactions is significantly higher than the non-farmer to non-farmer transactions by almost €830/ha. The log-linear estimations indicate that farmer sellers have higher bargaining power than non-farmer sellers. Because of the competition between farmers, when the sold area share of farmers increases by 50% at the municipality level, the price increases by €488/ha. Symmetric significant effect is measured on the demand side. For example, if the traded area share of farmers increases by 50% in the municipality, the price decreases by €172 /ha. The result on the supply side of traded land also reflects the higher willingness to accept (WTA) of farmers and the result on the demand side reflects a pure market power effect, since the farmers’ willingness to pay (WTP) is usually higher than non-farmers’ WTP.

Suggested Citation

  • Temesgen, Chalachew & Dupraz, Pierre, 2014. "The role of farmers’ competition on farmland price in local markets: Bretagne region of France," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170610, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea14:170610
    DOI: 10.22004/ag.econ.170610
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    File URL: http://ageconsearch.umn.edu/record/170610/files/AAEA_paper%20submission-1.pdf
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    References listed on IDEAS

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    Cited by:

    1. Paul Feichtinger & Klaus Salhofer, 2016. "The Fischler Reform of the Common Agricultural Policy and Agricultural Land Prices," Land Economics, University of Wisconsin Press, vol. 92(3), pages 411-432.

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    Keywords

    Demand and Price Analysis; Land Economics/Use; Marketing;

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