Abstract
Although determinants of agricultural land prices have received considerable attention in the literature, little is known about price formation on structured markets such as land auctions. This paper aims to empirically test theoretical predictions regarding price formation in land market auctions. The analysis is conducted for the case of Saxony-Anhalt, Germany, where state-owned land constitutes a significant share of the agricultural land market. The utilised data consists of public auction data provided by the Land-gesellschaft Sachsen-Anhalt (i.e. the rural development agency in Saxony-Anhalt), and covers approximately 700 calls for bids from 2003 to 2010, supplemented with regional and structural data. Spatial correlation of land prices is considered by applying a spatial econometrics approach. Our analysis shows that apart from land characteristics, the number of bidders and the share of non-agricultural investors have an impact on the land price.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
