IDEAS home Printed from https://ideas.repec.org/a/uwp/landec/v85y2009i4p587-597.html
   My bibliography  Save this article

Rents and Land Prices in Japan: A Panel Cointegration Approach

Author

Listed:
  • Ana I. Sanjuán
  • Philip J. Dawson
  • Lionel J. Hubbard
  • Sawako Shigeto

Abstract

The Japanese farmland market is strongly regulated, although partial deregulation and decentralization are evident. This paper examines the relationship between farmland rents and prices in Japan using recent panel cointegration methods, which admit structural breaks. Results show the presence of a cointegrating relationship with significant breaks that increased the rent/price ratio by 9% in 1967 and by 15% in 1980; prices cause rents, which supports an institutional rent-formation hypothesis; and the farmland market is inefficient.

Suggested Citation

  • Ana I. Sanjuán & Philip J. Dawson & Lionel J. Hubbard & Sawako Shigeto, 2009. "Rents and Land Prices in Japan: A Panel Cointegration Approach," Land Economics, University of Wisconsin Press, vol. 85(4), pages 587-597.
    • Handle: RePEc:uwp:landec:v:85:y:2009:i:4:p:587-597
    as

    Download full text from publisher

    File URL: http://le.uwpress.org/cgi/reprint/85/4/587
    Download Restriction: A subscription is required to access pdf files. Pay per article is available.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Joakim Westerlund, 2006. "Testing for Panel Cointegration with Multiple Structural Breaks," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 68(1), pages 101-132, February.
    2. Sergio H. Lence & Douglas J. Miller, 1999. "Transaction Costs and the Present Value Model of Farmland: Iowa, 1900–1994," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(2), pages 257-272.
    3. Søren Johansen & Rocco Mosconi & Bent Nielsen, 2000. "Cointegration analysis in the presence of structural breaks in the deterministic trend," Econometrics Journal, Royal Economic Society, vol. 3(2), pages 216-249.
    4. Falk, Barry L., 1991. "Formally Testing the Present Value Model of Farmland Prices," Staff General Research Papers Archive 11093, Iowa State University, Department of Economics.
    5. ., 1998. "Neumann, John von," Chapters, in: Heinz D. Kurz & Neri Salvadori (ed.), The Elgar Companion to Classical Economics, volume 0, chapter 120, Edward Elgar Publishing.
    6. David Canning & Peter Pedroni, 2008. "Infrastructure, Long‐Run Economic Growth And Causality Tests For Cointegrated Panels," Manchester School, University of Manchester, vol. 76(5), pages 504-527, September.
    7. Allen M. Featherstone & Timothy G. Baker, 1987. "An Examination of Farm Sector Real Asset Dynamics: 1910–85," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(3), pages 532-546.
    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. Hotopp, Henning & Mußhoff, Oliver, 2012. "Can rent adjustment clauses reduce the income risk of farms?," International Journal of Agricultural Management, Institute of Agricultural Management, vol. 1(4), pages 1-10, July.
    2. Alexey Akimov & Simon Stevenson & James Young, 2015. "Synchronisation and commonalities in metropolitan housing market cycles," Urban Studies, Urban Studies Journal Limited, vol. 52(9), pages 1665-1682, July.

    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. Ashok Mishra & Charles Moss & Kenneth Erickson, 2004. "Valuing farmland with multiple quasi-fixed inputs," Applied Economics, Taylor & Francis Journals, vol. 36(15), pages 1669-1675.
    2. Patrick de Fontnouvelle & Sergio H. Lence, 2002. "Transaction Costs and the Present Value “Puzzle” of Farmland Prices," Southern Economic Journal, John Wiley & Sons, vol. 68(3), pages 549-565, January.
    3. B. James Deaton & Chad Lawley, 2022. "A survey of literature examining farmland prices: A Canadian focus," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 70(2), pages 95-121, June.
    4. Mishra, Ashok K. & Moss, Charles B. & Erickson, Kenneth W., 2004. "Effect Of Debt Solvency On Farmland Values: A Panel Cointegration Approach," 2004 Annual meeting, August 1-4, Denver, CO 20261, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Gutierrez, Luciano & Erickson, Kenneth W. & Westerlund, Joakim, 2005. "The Present Value Model, Farmland Prices and Structural Breaks," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24702, European Association of Agricultural Economists.
    6. Gabriel Power & Calum Turvey, 2010. "US rural land value bubbles," Applied Economics Letters, Taylor & Francis Journals, vol. 17(7), pages 649-656.
    7. Vercammen, James, 2003. "A Stochastic Dynamic Programming Model Of Direct Subsidy Payments And Agricultural Investment," Working Papers 15847, University of British Columbia, Food and Resource Economics.
    8. Pinto, Allan & Griffin, Terry W., 2022. "Detecting bubbles via single time-series variable: applying spatial specification tests to farmland values," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322534, Agricultural and Applied Economics Association.
    9. 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.
    10. Ahrendsen, Bruce L., 1993. "A Structural Approach to Estimating Rate of Return Expectations of Farmers," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 25(2), pages 56-68, December.
    11. Dahl, Cody P. & Gunderson, Michael A. & Moss, Charles B., 2011. "Assessing the Rationality of Farmland Price Movements," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103827, Agricultural and Applied Economics Association.
    12. 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.
    13. Hanson, Steven D. & Myers, Robert J., 1995. "Testing for a time-varying risk premiumin the returns to U.S. farmland," Journal of Empirical Finance, Elsevier, vol. 2(3), pages 265-276, September.
    14. Xiaodong Du & David A. Hennessy & William M. Edwards, 2007. "Determinants of Iowa Cropland Cash Rental Rates: Testing Ricardian Rent Theory," Center for Agricultural and Rural Development (CARD) Publications 07-wp454, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    15. Arsova, Antonia & Karaman Örsal, Deniz Dilan, 2021. "A panel cointegrating rank test with structural breaks and cross-sectional dependence," Econometrics and Statistics, Elsevier, vol. 17(C), pages 107-129.
    16. Peia, Oana & Roszbach, Kasper, 2015. "Finance and growth: Time series evidence on causality," Journal of Financial Stability, Elsevier, vol. 19(C), pages 105-118.
    17. Andries, Natalia & Billon, Steve, 2016. "Retail bank interest rate pass-through in the euro area: An empirical survey," Economic Systems, Elsevier, vol. 40(1), pages 170-194.
    18. Barry FALK & Bong-Soo LEE, 1996. "Fads Versus Fundamentals In Farmland Prices," Staff Papers 281, Iowa State University Department of Economics.
    19. Fiechter, Chad & Kuethe, Todd & Zhang, Wendong, 2023. "Information Rigidities and Farmland Value Expectations," ISU General Staff Papers 202306131414240000, Iowa State University, Department of Economics.
    20. A. Tegene & F. Kuchler, 1993. "A Regression Test Of The Present Value Model Of Us Farmland Prices," Journal of Agricultural Economics, Wiley Blackwell, vol. 44(1), pages 135-143, January.

    More about this item

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

    Statistics

    Access and download statistics

    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:uwp:landec:v:85:y:2009:i:4:p:587-597. 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: the person in charge (email available below). General contact details of provider: https://le.uwpress.org/ .

    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.