IDEAS home Printed from https://ideas.repec.org/a/gam/jagris/v12y2022i2p207-d740282.html
   My bibliography  Save this article

Green Payment Programs and Farmland Prices—An Empirical Investigation

Author

Listed:
  • Tzong-Haw Lee

    (School of Economics and Management, Hubei Polytechnic University, No. 16 North Road, Guilin 435003, China)

  • Brian Lee

    (Program in Science, Technology and Environmental Policy, Princeton School of Policy and International Affairs, Princeton University, Princeton, NJ 08544, USA)

  • Yi-Ju Su

    (Department of Economics, Shih Hsin University, No.111, Sec. 1, Mu-Cha Rd., Wenshan Dist., Taipei 11645, Taiwan)

  • Hung-Hao Chang

    (Department of Agricultural Economics, National Taiwan University, No. 1 Roosevelt Road, Section 4, Taipei 10617, Taiwan)

Abstract

Research has examined the impact of green payment programs on agricultural and economic outcomes such as agricultural productivity and farm income. However, it is unclear whether these policies are capitalized into farmland prices. This paper provides some of the first evidence on the causal impact of green payment programs on farmland prices based on evidence from Taiwan. Using administrative farmland transactions data with the ordinary least squares (OLS) method and the semi-parametric smooth coefficient model (SCM), we find that green payment programs increase farmland prices by an average of 3.9 percentage points in townships that implemented the policy. Moreover, the program’s effects on farmland prices are not homogenous, varying by farmland size. The magnitude of this effect is more pronounced on rural farmland prices and across quantiles of the farmland size distribution.

Suggested Citation

  • Tzong-Haw Lee & Brian Lee & Yi-Ju Su & Hung-Hao Chang, 2022. "Green Payment Programs and Farmland Prices—An Empirical Investigation," Agriculture, MDPI, vol. 12(2), pages 1-11, February.
    • Handle: RePEc:gam:jagris:v:12:y:2022:i:2:p:207-:d:740282
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2077-0472/12/2/207/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2077-0472/12/2/207/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Feng, Hongli, 2007. "Green payments and dual policy goals," Journal of Environmental Economics and Management, Elsevier, vol. 54(3), pages 323-335, November.
    2. Hung-Hao Chang & Dayton M. Lambert & Ashok K. Mishra, 2008. "Does participation in the conservation reserve program impact the economic well-being of farm households?," Agricultural Economics, International Association of Agricultural Economists, vol. 38(2), pages 201-212, March.
    3. Alfons Weersink & Steve Clark & Calum G. Turvey & Rakhal Sarker, 1999. "The Effect of Agricultural Policy on Farmland Values," Land Economics, University of Wisconsin Press, vol. 75(3), pages 425-439.
    4. Edward H K Ng, 2021. "Common Risk Models and Analytics," World Scientific Book Chapters, in: RISK ANALYTICS From Concept to Deployment, chapter 9, pages 99-118, World Scientific Publishing Co. Pte. Ltd..
    5. Gong, Qiang & Jacoby, Gady & Li, Shi & Lu, Lei, 2021. "Commonality in disagreement," Pacific-Basin Finance Journal, Elsevier, vol. 67(C).
    6. Chihiro Udagawa & Ian Hodge & Mark Reader, 2014. "Farm Level Costs of Agri-environment Measures: The Impact of Entry Level Stewardship on Cereal Farm Incomes," Journal of Agricultural Economics, Wiley Blackwell, vol. 65(1), pages 212-233, January.
    7. Hellerstein, Daniel M., 2017. "The US Conservation Reserve Program: The evolution of an enrollment mechanism," Land Use Policy, Elsevier, vol. 63(C), pages 601-610.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Brian Lee & Po-Yuan Cheng & Lih-Chyun Sun & Yi-Ting Hsieh & Hung-Hao Chang, 2022. "Does COVID-19 Affect Farmland Prices? How and Why?," Agriculture, MDPI, vol. 12(12), pages 1-12, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carlberg, Jared G., 2002. "Effects Of Ownership Restrictions On Farmland Values In Saskatchewan," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 34(2), pages 1-10, August.
    2. Meike Weltin & Silke Hüttel, 2023. "Sustainable Intensification Farming as an Enabler for Farm Eco-Efficiency?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 84(1), pages 315-342, January.
    3. Callahan, Scott & Ifft, Jennifer & Michaud, Clayton P., 2022. "The impact of countercyclical farm programs on agricultural land values," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322579, Agricultural and Applied Economics Association.
    4. Oltmer, Katrin & Florax, Raymond J.G.M., 2001. "Impacts Of Agricultural Policy Reform On Land Prices: A Quantitative Analysis Of The Literature," 2001 Annual meeting, August 5-8, Chicago, IL 20507, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Deepananda Herath & Alfons Weersink, 2007. "Peasants and plantations in the Sri Lankan tea sector: causes of the change in their relative viability ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(1), pages 73-89, March.
    6. Shaik, Saleem & Atwood, Joseph A. & Helmers, Glenn A., 2012. "Did 1933 new deal legislation contribute to farm real estate values: A regional analysis," Journal of Policy Modeling, Elsevier, vol. 34(6), pages 801-816.
    7. Guyomard, Herve & Lankoski, Jussi E. & Ollikainen, Markku, 2005. "Impacts of Agri-Environmental Policies on Land Allocation and Prices," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24466, European Association of Agricultural Economists.
    8. Laure Kuhfuss & Julie Subervie, 2015. "Do agri-environmental schemes help reduce herbicide use? Evidence from a natural experiment in France," Post-Print hal-01199067, HAL.
    9. Elanor Starmer & Aimee Witteman & Timothy A. Wise, "undated". "Feeding the Factory Farm: Implicit Subsidies to the Broiler Chicken Industry," GDAE Working Papers 06-03, GDAE, Tufts University.
    10. Ogawa, Keishi & Garrod, Guy & Yagi, Hironori, 2023. "Sustainability strategies and stakeholder management for upland farming," Land Use Policy, Elsevier, vol. 131(C).
    11. Pavel Ciaian & d’Artis Kancs & Johan Swinnen, 2010. "EU Land Markets and the Common Agricultural Policy," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 53(3), pages 1-31.
    12. Wallander, Steven & Aillery, Marcel & Hellerstein, Daniel & Hand, Michael S., 2013. "The Role of Conservation Programs in Drought Risk Adaptation," Economic Research Report 262224, United States Department of Agriculture, Economic Research Service.
    13. Whitaker, James B. & Effland, Anne, 2009. "Income Stabilization Through Government Payments: How is Farm Household Consumption Affected?," Agricultural and Resource Economics Review, Cambridge University Press, vol. 38(1), pages 36-48, April.
    14. Lewis, David J. & Plantinga, Andrew J. & Nelson, Erik & Polasky, Stephen, 2011. "The efficiency of voluntary incentive policies for preventing biodiversity loss," Resource and Energy Economics, Elsevier, vol. 33(1), pages 192-211, January.
    15. Latruffe , Laure & Piet, Laurent & Dupraz, Pierre & Le Mouël, Chantal, 2013. "Influence of Agricultural Support on Sale Prices of French Farmland: A comparison of different subsidies, accounting for the role of environmental and land regulations," Factor Markets Working Papers 163, Centre for European Policy Studies.
    16. Zhang, Daojun & Yin, Runsheng, 2019. "Spatial characteristics of degraded land and their implications to the design and implementation of landscape restoration programs: West China as an example," Forest Policy and Economics, Elsevier, vol. 107(C), pages 1-1.
    17. Wanglin Ma & Peng Nie & Pei Zhang & Alan Renwick, 2020. "Impact of Internet use on economic well‐being of rural households: Evidence from China," Review of Development Economics, Wiley Blackwell, vol. 24(2), pages 503-523, May.
    18. L. Latruffe & T. Doucha & Ch. Le Mouël & T. Medonos & V. Voltr, 2008. "Capitalisation of government support in agricultural land prices in the Czech Republic," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 54(10), pages 451-460.
    19. Turvey, Calum G. & Ellinger, Paul N., 2002. "A Comparative Study of the Financial Performance of Grain and Oilseed Farms in Ontario and Illinois," 2002 Regional Committee NC-221, October 7-8, 2002, Denver, Colorado 132376, Regional Research Committee NC-1014: Agricultural and Rural Finance Markets in Transition.
    20. Gianni Guastella & Daniele Moro & Paolo Sckokai & Mario Veneziani, 2018. "The Capitalisation of CAP Payments into Land Rental Prices: A Panel Sample Selection Approach," Journal of Agricultural Economics, Wiley Blackwell, vol. 69(3), pages 688-704, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jagris:v:12:y:2022:i:2:p:207-:d:740282. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.