Farmland values and bidder behaviour in first-price land auctions

Identification of standard auction models

Carsten Croonenbroeck, Martin Odening and Silke Hüttel

European Review of Agricultural Economics, 2020, vol. 47, issue 2, 558-590

Abstract: We investigate potential asymmetries among bidders in land auctions that may entail market inefficiencies. Using representative data for eastern Germany including winning bids, bidder characteristics and land amenities, we pursue a structural approach to derive distributions of latent land values for different bidder groups. By applying non-parametric techniques, we cannot find evidence for distinct asymmetries while differentiating between legal entities, tenancy status and nationality of bidders. Our findings challenge the hypothesis that land privatisation via auctions discriminates against certain buyer groups – an argument that is often used to justify stricter regulation of agricultural land markets.

Keywords: first-price sealed bid land auctions; structural estimation; buyer heterogeneity (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (12)

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Related works:
Working Paper: Farmland values and bidder behavior in first-price land auctions (2018)
Working Paper: Farmland Values and Bidder Behavior in First-Price Land Auctions (2018)
Working Paper: Farmland values and bidder behavior in first-price land auctions (2018)
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