Agroholdings and land rental markets: a spatial competition perspective

Marten Graubner, Igor Ostapchuk and Taras Gagalyuk

European Review of Agricultural Economics, 2021, vol. 48, issue 1, 158-206

Abstract: With the emergence of large, horizontally integrated farm enterprises especially in Eastern European countries, the question arises whether these agroholdings exercise market power in (local) land markets. Using a theoretical framework of spatial competition that accounts for the presence of multi-farm agroholdings, we derive equilibrium prices under alternative spatial competition settings. Based on the investigation of Ukrainian farms, we provide theoretical explanations and empirical support for farms affiliated with an agroholding possessing (ceteris paribus) more land and setting higher land rental prices compared to independent farms. The results indicate that agroholdings may act as price leaders in local land markets.

Keywords: land rental market; Ukraine; local market power (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (19)

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