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The Incidence of Foreign Market Accessibility on Farmland Rental Rates

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  • Jisang Yu
  • Nelson B. Villoria
  • Nathan P. Hendricks

Abstract

We estimate the impact of the tariffs that U.S. export crops face on farmland rental rates. The estimation of the impact of the localized measure on the rents faces two aggregation problems that lead to identification challenges: a) aggregating tariffs across trading partners to obtain crop-specific tariffs, and b) aggregating the crop-specific tariffs across crops to obtain the localized measure. Utilizing shift-share style approaches, we find that a one percent increase in the localized tariff reduces the rents by about 2.6 - 5.3% point, which implies that the 2018 Chinese retaliatory tariffs would reduce the rents by about 2%.

Suggested Citation

  • Jisang Yu & Nelson B. Villoria & Nathan P. Hendricks, 2020. "The Incidence of Foreign Market Accessibility on Farmland Rental Rates," NBER Working Papers 27180, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:27180
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    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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