This paper analyses farmland price formation under investors’ increased demand in the Czech Republic from 2008 to 2014. We adopt a stochastic metafrontier approach to hedonic price modelling and investigate the relative differences in farm and investor pricing. Our results provide evidence of buyer group-specific land valuations, asymmetric price dispersions and their temporal changes. These changes reflect the developments of market microstructures and market-supporting institutions induced by buyer competition. While initially significantly lower due to high market and bargaining power, prices paid by corporate/cooperative farms converged with high-level investor prices over time. Individual and family farms were largely unable to compete at the new price levels.
Hruška, M., Jelínek, L., Medonos, Curtiss, J., Hüttel, S.
European Review of Agricultural Economics, Volume, 48, Nr. 1, 2021, p. 97-157, eISSN 0165-1587