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Farm Income, Population, and Farmland Prices: A Relative Information Approach

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  • Salois, Matthew
  • Moss, Charles
  • Erickson, Kenneth

Abstract

This paper uses an entropy-based information approach to determine if farmland values are more closely associated with urban pressure or farm income. The basic question is: how much information on changes in farm real estate values is contained in changes in population versus changes in returns to production agriculture? Results suggest population is informative, but changes in farmland values are more strongly associated with changes in the distribution of returns. However, this relationship is not true for every region nor does it hold over time, as for some regions changes in population are more informative. Results have policy implications for both equity and efficiency.

Suggested Citation

  • Salois, Matthew & Moss, Charles & Erickson, Kenneth, 2010. "Farm Income, Population, and Farmland Prices: A Relative Information Approach," MPRA Paper 26848, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:26848
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    File URL: https://mpra.ub.uni-muenchen.de/26848/1/MPRA_paper_26848.pdf
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    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. Erickson, Kenneth W. & Blank, Steven C. & Moss, Charles B. & Mishra, Ashok K., 2004. "Regional Changes In The Distribution Of Net Value Added In U.S. Agriculture, 1960-2002," 2004 Annual Meeting, June 30-July 2, 2004, Honolulu, Hawaii 36232, Western Agricultural Economics Association.
    3. Yue Jin Shi & Timothy T. Phipps & Dale Colyer, 1997. "Agricultural Land Values under Urbanizing Influences," Land Economics, University of Wisconsin Press, vol. 73(1), pages 90-100.
    4. C. W. Granger & E. Maasoumi & J. Racine, 2004. "A Dependence Metric for Possibly Nonlinear Processes," Journal of Time Series Analysis, Wiley Blackwell, vol. 25(5), pages 649-669, September.
    5. Soofi, E. S. & Retzer, J. J., 2002. "Information indices: unification and applications," Journal of Econometrics, Elsevier, vol. 107(1-2), pages 17-40, March.
    6. Theil, Henri & Theil, Henri, 1979. "World income inequality and its components," Economics Letters, Elsevier, vol. 2(1), pages 99-102.
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    Citations

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    Cited by:

    1. repec:gam:jsusta:v:10:y:2018:i:1:p:243-:d:127611 is not listed on IDEAS
    2. Ay, Jean-Sauveur & Latruffe, Laure, 2013. "The Empirical Content of the Present Value Model: A survey of the instrumental uses of farmland prices," Working Papers 157112, Factor Markets, Centre for European Policy Studies.
    3. Feichtinger, Paul & Salhofer, Klaus, 2011. "The Valuation of Agricultural Land and the Influence of Government Payments," Factor Markets Working Papers 112, Centre for European Policy Studies.
    4. Saguatti, Annachiara & Erickson, Kenneth & Gutierrez, Luciano, 2014. "Spatial panel models for the analysis of land prices," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182757, European Association of Agricultural Economists.
    5. Saguatti, Annachiara & Erickson, Kenneth & Gutierrez, Luciano, 2014. "Spatial panel models for the analysis of land prices," 2014 Third Congress, June 25-27, 2014, Alghero, Italy 172997, Italian Association of Agricultural and Applied Economics (AIEAA).
    6. Salois, Matthew J., 2013. "Regional changes in the distribution of foreign aid: An entropy approach," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(13), pages 2893-2902.
    7. Feichtinger, Paul & Salhofer, Klaus, 2013. "What Do We Know about the Influence of Agricultural Support on Agricultural Land Prices?," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 62(2).
    8. Mela, Giulio & Longhitano, Davide & Povellato, Andrea, 2016. "Agricultural and non-agricultural determinants of Italian farmland values," 2016 Fifth AIEAA Congress, June 16-17, 2016, Bologna, Italy 242327, Italian Association of Agricultural and Applied Economics (AIEAA).

    More about this item

    Keywords

    entropy; land values; information theory; population growth.;

    JEL classification:

    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General

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