Farm Income, Population, and Farmland Prices: A Relative Information Approach

Salois, Matthew and Moss, Charles and Erickson, Kenneth (2010): Farm Income, Population, and Farmland Prices: A Relative Information Approach.

Abstract

This paper uses an entropy-based information approach to determine if farmland values are more closely associated with urban pressure or farm income. The basic question is: how much information on changes in farm real estate values is contained in changes in population versus changes in returns to production agriculture? Results suggest population is informative, but changes in farmland values are more strongly associated with changes in the distribution of returns. However, this relationship is not true for every region nor does it hold over time, as for some regions changes in population are more informative. Results have policy implications for both equity and efficiency.

• Item Type: MPRA Paper
• Language: English
• Keywords: entropy; land values; information theory; population growth.
• Subjects: Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q2 - Renewable Resources and Conservation > Q24 - Land; C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C61 - Optimization Techniques ; Programming Models ; Dynamic Analysis; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q1 - Agriculture > Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets; C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C11 - Bayesian Analysis: General

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