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2018-07-02Diskussionspapier DOI: 10.18452/19263
Land price diffusion across borders: The case of Germany (03/2018)
dc.contributor.authorGrau, Aaron
dc.contributor.authorOdening, Martin
dc.contributor.authorRitter, Matthias
dc.date.accessioned2018-07-02T08:26:52Z
dc.date.available2018-07-02T08:26:52Z
dc.date.issued2018-07-02
dc.identifier.urihttp://edoc.hu-berlin.de/18452/20024
dc.description.abstractLand market regulations are often justified by the assumption that activities of foreign and nonagricultural investors drive up land prices in countries with low land price levels. However, empirical knowledge about the dynamics of agricultural land prices across borders is sparse. Using the German reunification as a natural experiment, we study the effect of the former inner German border on the dynamics of agricultural land prices in East and West Germany. We apply a land price diffusion model with an error correction specification that estimates to what extent agricultural land markets are spatially integrated. A novel feature of our model is its ability to distinguish price diffusion within states and across state borders. We find that local agricultural land markets in Germany are linked by a long-run equilibrium relationship. Spatial market integration, however, does not hold among all counties in our study area. Regarding our main research question, we provide evidence for a persistent border effect given that the fraction of spatially integrated counties is larger within states than across the former border. Moreover, we observe non-significant error correction terms for many counties along the former border. From a policy perspective, it is striking to realize that even 25 years after German reunification, pronounced land price differences persist. It is quite likely that price diffusion through existing borders within the EU would take even more time given language barriers, different administrative procedures for land acquisitions, different tax systems, and information asymmetries between domestic and foreign market participants.eng
dc.language.isoeng
dc.publisherHumboldt-Universität zu Berlin
dc.rights(CC BY-NC-ND 3.0 DE) Namensnennung - Nicht-kommerziell - Keine Bearbeitung 3.0 Deutschlandger
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/de/
dc.subjectAgricultural land marketseng
dc.subjectprice diffusion;eng
dc.subjectspatial dependenceeng
dc.subjectborder effecteng
dc.subject.ddc630 Landwirtschaft und verwandte Bereiche
dc.titleLand price diffusion across borders: The case of Germany (03/2018)
dc.typeworkingPaper
dc.identifier.urnurn:nbn:de:kobv:11-110-18452/20024-4
dc.identifier.doihttp://dx.doi.org/10.18452/19263
local.edoc.container-titleFORLand Working Papers
local.edoc.container-creatorMartin Odening
local.edoc.pages25
local.edoc.type-nameDiskussionspapier
local.edoc.institutionLebenswissenschaftliche Fakultät
local.edoc.container-typeseries
local.edoc.container-type-nameSchriftenreihe
local.edoc.container-volume3
local.edoc.container-erstkatid2941991-8

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