IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-02645617.html
   My bibliography  Save this paper

Urban influence of farmland prices and its impact on agriculture
[L'influence urbaine sur le prix des terres agricoles et ses conséquences pour l'agriculture]

Author

Listed:
  • Jean Cavailhès

    (CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux - INRA - Institut National de la Recherche Agronomique - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement)

  • Mohamed Hilal

    (CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux - INRA - Institut National de la Recherche Agronomique - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement)

  • Pierre Wavresky

    (CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux - INRA - Institut National de la Recherche Agronomique - AgroSup Dijon - Institut National Supérieur des Sciences Agronomiques, de l'Alimentation et de l'Environnement)

Abstract

The many land-related issues in peri-urban areas include conversion of farmland, forests, and natural land to urban use, capital gains generated by urbanization, and conservation of land ressources for non-market purposes of the future generations. These issues are settled in the land market, where economic agents compete for land use. The highest bidder acquires the right to choose the type of use in compliance with existing regulations. We seek to shed light on the farmland market's response to the current peri-urbanization trend in France. For this purpose, we study the volumes and intended uses of plots traded, as well as price formation, using econometric models on individual data prepared from notifications of sales filed with "land Use and Rural Settlement Corporations" (Societés d'Aménagement Foncier et d'Etablissement Rural:SAFERs). In the most agriculturally oriented market segment (land intended for farm use, purchase by a farmer, no buildings), land prices are influenced by the urban system. The price decreases as one moves away from large cities and urban clusters, and it varies in step with population size and growth. However, these effects do not play an identical role in the three regions selected for our study: the Côte d'Or and Nord départements and the Toulouse region. The "monocentrism" of Toulouse and Dijon stands in contrast to the "polycentric" pattern in the Nord.

Suggested Citation

  • Jean Cavailhès & Mohamed Hilal & Pierre Wavresky, 2011. "Urban influence of farmland prices and its impact on agriculture [L'influence urbaine sur le prix des terres agricoles et ses conséquences pour l'agriculture]," Post-Print hal-02645617, HAL.
    • Handle: RePEc:hal:journl:hal-02645617
    Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-02645617
    as

    Download full text from publisher

    File URL: https://hal.inrae.fr/hal-02645617/document
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Vincent E. Breneman & Richard F. Nehring, 2006. "Urban Sprawl and Farmland Prices," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(4), pages 915-929.
    2. Hakkio, Craig S. & Rush, Mark, 1991. "Cointegration: how short is the long run?," Journal of International Money and Finance, Elsevier, vol. 10(4), pages 571-581, December.
    3. Paul Thorsnes, 2002. "The Value of a Suburban Forest Preserve: Estimates from Sales of Vacant Residential Building Lots," Land Economics, University of Wisconsin Press, vol. 78(3), pages 426-441.
    4. Capozza, Dennis & Li, Yuming, 1994. "The Intensity and Timing of Investment: The Case of Land," American Economic Review, American Economic Association, vol. 84(4), pages 889-904, September.
    5. Fujita,Masahisa, 1991. "Urban Economic Theory," Cambridge Books, Cambridge University Press, number 9780521396455, September.
    6. Abebayehu Tegene & Keith Wiebe & Betsey Kuhn, 1999. "Irreversible Investment Under Uncertainty: Conservation Easements and the Option to Develop Agricultural Land," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(2), pages 203-219, May.
    7. Capozza, Dennis R. & Helsley, Robert W., 1990. "The stochastic city," Journal of Urban Economics, Elsevier, vol. 28(2), pages 187-203, September.
    8. Jan K. Brueckner, 1990. "Growth Controls and Land Values in an Open City," Land Economics, University of Wisconsin Press, vol. 66(3), pages 237-248.
    9. Tamer Isgin & D. Lynn Forster, 2006. "A Hedonic Price Analysis of Farmland Option Premiums Under Urban Influences," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(3), pages 327-340, September.
    10. Fisher, Anthony C & Hanemann, W Michael, 1990. "Option Value: Theory and Measurement," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 17(2), pages 167-180.
    11. Andrew J. Plantinga & Douglas J. Miller, 2001. "Agricultural Land Values and the Value of Rights to Future Land Development," Land Economics, University of Wisconsin Press, vol. 77(1), pages 56-67.
    12. Sergio H. Lence & Ashok K. Mishra, 2003. "The Impacts of Different Farm Programs on Cash Rents," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(3), pages 753-761.
    13. Mykel R. Taylor & Gary W. Brester, 2005. "Noncash Income Transfers and Agricultural Land Values," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(4), pages 526-541.
    14. Jean CavailhËs & Pierre Wavresky, 2003. "Urban influences on periurban farmland prices," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 30(3), pages 333-357, September.
    15. Capozza, Dennis R. & Helsley, Robert W., 1989. "The fundamentals of land prices and urban growth," Journal of Urban Economics, Elsevier, vol. 26(3), pages 295-306, November.
    16. Ian W. Hardie & Tulika A. Narayan & Bruce L. Gardner, 2001. "The Joint Influence of Agricultural and Nonfarm Factors on Real Estate Values: An Application to the Mid-Atlantic Region," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(1), pages 120-132.
    17. Plantinga, Andrew J. & Lubowski, Ruben N. & Stavins, Robert N., 2002. "The effects of potential land development on agricultural land prices," Journal of Urban Economics, Elsevier, vol. 52(3), pages 561-581, November.
    18. Colwell, Peter F. & Munneke, Henry J., 1997. "The Structure of Urban Land Prices," Journal of Urban Economics, Elsevier, vol. 41(3), pages 321-336, May.
    19. Jean Cavailhès & Pierre Wavresky, 2003. "Urban influences on periurban farmland prices [[L'influence urbaine sur le prix des terres périurbaines]]," Post-Print hal-02670737, HAL.
    20. Barry K. Goodwin & Ashok K. Mishra & François N. Ortalo-Magné, 2003. "What's Wrong with Our Models of Agricultural Land Values?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(3), pages 744-752.
    21. Elena G. Irwin, 2002. "The Effects of Open Space on Residential Property Values," Land Economics, University of Wisconsin Press, vol. 78(4), pages 465-480.
    22. Allan W. Gray & Michael D. Boehlje & Brent A. Gloy & Stephen P. Slinsky, 2004. "How U.S. Farm Programs and Crop Revenue Insurance Affect Returns to Farm Land," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(2), pages 238-253.
    23. Arnott, Richard J & Lewis, Frank D, 1979. "The Transition of Land to Urban Use," Journal of Political Economy, University of Chicago Press, vol. 87(1), pages 161-169, February.
    24. Brian Roe & Elena G. Irwin & Hazel A. Morrow-Jones, 2004. "The Effects of Farmland, Farmland Preservation, and Other Neighborhood Amenities on Housing Values and Residential Growth," Land Economics, University of Wisconsin Press, vol. 80(1), pages 55-75.
    25. Cunningham, Christopher R., 2006. "House price uncertainty, timing of development, and vacant land prices: Evidence for real options in Seattle," Journal of Urban Economics, Elsevier, vol. 59(1), pages 1-31, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jean Cavailhès & Mohamed Hilal & Pierre Wavresky, 2011. "L’influence urbaine sur le prix des terres agricoles et ses conséquences pour l’agriculture," Économie et Statistique, Programme National Persée, vol. 444(1), pages 99-125.
    2. Jean Cavailhés & Isabelle Thomas, 2011. "The influence of urban sprawl on farmland prices in Belgium (refereed paper)," ERSA conference papers ersa10p1628, European Regional Science Association.
    3. Jean Cavailhés & Mohamed Hilal & Pierre Wavresky, 2011. "Option values on periurban land markets," ERSA conference papers ersa10p1629, European Regional Science Association.
    4. Jean Cavailhès & Mohamed Hilal & Pierre Wavresky, 2013. "A new real option value due to "demographic risk" in the market for developable land," Post-Print hal-00939785, HAL.
    5. B. James Deaton & Chad Lawley, 2022. "A survey of literature examining farmland prices: A Canadian focus," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 70(2), pages 95-121, June.
    6. Coisnon, Thomas & Oueslati, Walid & Salanié, Julien, 2014. "Urban sprawl occurrence under spatially varying agricultural amenities," Regional Science and Urban Economics, Elsevier, vol. 44(C), pages 38-49.
    7. Livanis, Grigorios T. & Moss, Charles B. & Breneman, Vincent E. & Nehring, Richard F., 2005. "Urban Sprawl and Farmland Prices," Working Papers 15657, University of Florida, International Agricultural Trade and Policy Center.
    8. Thomas Coisnon & Walid Oueslati & Julien Salanié, 2012. "Urban sprawl occurrence under spatially varying agricultural bid-rent and amenities," Working Papers halshs-00748681, HAL.
    9. Guillaume POUYANNE, 2008. "Economics of discontinuous urban development (In French)," Cahiers du GREThA (2007-2019) 2008-07, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    10. Stéphane Virol & Guillaume Pouyanne & Sandrine Lyser & Frédéric Gaschet & Jeanne Dachary-Bernard, 2011. "L’impact de la littoralisation sur les marchés fonciers. Une approche comparative des côtes basque et charentaise," Économie et Statistique, Programme National Persée, vol. 444(1), pages 127-154.
    11. Wendong Zhang & Cynthia J. Nickerson, 2015. "Housing Market Bust and Farmland Values: Identifying the Changing Influence of Proximity to Urban Centers," Land Economics, University of Wisconsin Press, vol. 91(4), pages 605-626.
    12. Caruso, Geoffrey & Peeters, Dominique & Cavailhes, Jean & Rounsevell, Mark, 2007. "Spatial configurations in a periurban city. A cellular automata-based microeconomic model," Regional Science and Urban Economics, Elsevier, vol. 37(5), pages 542-567, September.
    13. Walid Oueslati & Julien Salanié & JunJie Wu, 2014. "Urbanization and Agricultural Structural Adjustments: Some Lessons from European Cities," Working Papers 1442, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    14. Plantinga, Andrew J. & Lubowski, Ruben N. & Stavins, Robert N., 2002. "The effects of potential land development on agricultural land prices," Journal of Urban Economics, Elsevier, vol. 52(3), pages 561-581, November.
    15. 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.
    16. Jeanne Dachary-Bernard & Frédéric Gaschet & Sandrine Lyser & Guillaume Pouyanne & Stéphane Virol, 2011. "L'impact de la littoralisation sur les marchés fonciers : une approche comparative des côtes basque et charentaise," Post-Print hal-00688634, HAL.
    17. Thomas Coisnon & Walid Oueslati & Julien Salanié, 2013. "Spatial targeting of agri-environmental policy and urban development," Post-Print halshs-00949730, HAL.
    18. Ludo Peeters & Eloi Schreurs & Steven Passel, 2017. "Heterogeneous Impact of Soil Contamination on Farmland Prices in the Belgian Campine Region: Evidence from Unconditional Quantile Regressions," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(1), pages 135-168, January.
    19. Benoît A. Delbecq & Todd H. Kuethe & Allison M. Borchers, 2014. "Identifying the Extent of the Urban Fringe and Its Impact on Agricultural Land Values," Land Economics, University of Wisconsin Press, vol. 90(4), pages 587-600.
    20. Jeanne DACHARY-BERNARD & Sandrine LYSER & Frédéric GASCHET & Guillaume POUYANNE & Stéphane VIROL, 2011. "Real Estate and Land Values on the shoreline: a transaction-level analysis (In French)," Cahiers du GREThA (2007-2019) 2011-07, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-02645617. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.