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The pre-emption right in Italian agriculture: A preliminary evaluation of the direct farmer-neighbouring owner’s case

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  • Galletto, Luigi

Abstract

Direct farmer-neighbouring owner’s pre-emption right has played an important role in the Italian farmland market since 1971. This right gives preference to a direct farmer owner in purchasing a land lot neighbouring his property among other buyers. After dealing with the main characteristics of the right regarding both the farmland market and its economic content in the frame of the farm evaluation theory, the paper presents a first evaluation of this right, by means of the Contingent Evaluation method. Willingness to accept (WTA) for not exerting the right was estimated from 119 farmers’ samples and a set of farm- and farmer-related variables was employed to explain WTA. Average WTA accounts for about one-sixth of the land value, but variability is quite high. The factors with the highest impact on the right value are the presence of a child willing to carry on the farm business, the land value, and the share of irrigated land. Low values appear related more with the direct farmer’s status than a real intention to enlarge the property.

Suggested Citation

  • Galletto, Luigi, 2018. "The pre-emption right in Italian agriculture: A preliminary evaluation of the direct farmer-neighbouring owner’s case," Land Use Policy, Elsevier, vol. 72(C), pages 46-56.
  • Handle: RePEc:eee:lauspo:v:72:y:2018:i:c:p:46-56
    DOI: 10.1016/j.landusepol.2017.12.026
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    1. Isenhardt, Lars & Seifert, Stefan & Huettel, Silke, 2021. "On the price effect of a right-of-first-refusal in farmland auctions," 95th Annual Conference, March 29-30, 2021, Warwick, UK (Hybrid) 312053, Agricultural Economics Society - AES.

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