Do non-farmers pay more for land than farmers?

Lorenz Schmidt, Martin Odening and Matthias Ritter

European Review of Agricultural Economics, 2024, vol. 51, issue 4, 1094-1128

Abstract: The increase in farmland prices in many parts of the world over the past decade has sparked discussions about whether non-farmers pay higher prices for farmland. This study uses a causal machine learning approach with a rich data set of land transactions in Germany to quantify the potential price premium paid by non-farmers. By applying the causal forest method, we uncover the heterogeneity of price premiums and reveal moderating effects of covariates. We find that the average positive price premium by non-farmers decreases with parcel size and distance to a highway exit.

Keywords: causal machine learning; causal forest; heterogeneous treatment effect; farmland; non-agricultural investors (search for similar items in EconPapers)
Date: 2024
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