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Impacts Of 2003 Cap Reform On Land Prices: From Theory To Empirical Results

  • Kilian, Stefan
  • Anton, Jesus
  • Roder, Norbert
  • Salhofer, Klaus
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    Based on a graphical model we analyse the impacts of the Fischler Reform on land prices and the capitalization of single farm payments (sfp) into land values. The model shows that if there are more sfp than eligible land, the capitalization ratio will not decline but rather increase due to the inclusion of animal premiums in the sfp. We can confirm our theoretical results for cross-section data on land rental prices in Bavaria in 2005. Empirical results indicate that sfp of the Fischler reform are more capitalized into rental prices than the coupled direct payments of the time prior to the reform.

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    File URL: http://purl.umn.edu/44808
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    Paper provided by European Association of Agricultural Economists in its series 109th Seminar, November 20-21, 2008, Viterbo, Italy with number 44808.

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    Date of creation: 12 Nov 2008
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    Handle: RePEc:ags:eaa109:44808
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