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Land Pricing Model: Price Re-evaluation Due to the Erosion and Climate Change Effects

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  • Slaboch, Josef
  • Čechura, Lukáš

Abstract

The aim of this study is to derive and apply the hedonic approach for determining and updating official land prices with respect to e.g. the impact of climate change that has occurred in the conditions of the Czech Republic in recent years. Pricing using the hedonic method is based on capturing individual factors separately. The evaluated soil ecological unit code consists of a 5-digit numerical code, which expresses the affiliation to the climate region (0-9, see table 1), the main soil unit (0-78), the slope of the land and the orientation to the point of the compass (0-9) and also the depth of the soil profile and skeletality (0-9). The derived hedonic pricing model is estimated using heteroscedasticity corrected estimator. The fitted model shows considerably high explanatory power and together with high parameter significance for majority of dummy variables (soil characteristics) as well as with theoretical and logical consistency represent a tool for new official land price settings in the process of land reevaluation due to the erosion and climate change effects.

Suggested Citation

  • Slaboch, Josef & Čechura, Lukáš, 2020. "Land Pricing Model: Price Re-evaluation Due to the Erosion and Climate Change Effects," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 10(3), December.
    • Handle: RePEc:ags:aolpei:309929
    DOI: 10.22004/ag.econ.309929
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    References listed on IDEAS

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    1. Allison Borchers & Jennifer Ifft & Todd Kuethe, 2014. "Linking the Price of Agricultural Land to Use Values and Amenities," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(5), pages 1307-1320.
    2. Maria Belyaeva & Raushan Bokusheva, 2018. "Will climate change benefit or hurt Russian grain production? A statistical evidence from a panel approach," Climatic Change, Springer, vol. 149(2), pages 205-217, July.
    3. Steven Passel & Emanuele Massetti & Robert Mendelsohn, 2017. "A Ricardian Analysis of the Impact of Climate Change on European Agriculture," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(4), pages 725-760, August.
    4. Martina Bozzola & Emanuele Massetti & Robert Mendelsohn & Fabian Capitanio, 2018. "A Ricardian analysis of the impact of climate change on Italian agriculture," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 45(1), pages 57-79.
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    Cited by:

    1. Josef Slaboch & Michal Malý, 2021. "Agriculture Land Price Setting Systems, and Possible Directions for Their Updating," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 69(6), pages 655-664.
    2. Silvia Russo & Rino Ghelfi & Meri Raggi & Davide Viaggi, 2024. "Factors Affecting the Land Investment Decisions in the Old Members of the European Union: A Systematic Literature Review," Land, MDPI, vol. 13(4), pages 1-18, April.

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