Agricultural and Biological Sciences
4 years ago

Government subsidies significantly drive up farmland rental rates, benefiting landlords.

RePEc: Research Papers in Economics
An Empirical Investigation of the Impacts of Government Program Payments on Farmland Rental Rates
Feng Qiu, Jean‐Philippe Gervais, Barry K. Goodwin

Paper Summary

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The study looked at how government payments affect rental rates for farmland in the US. They found that these subsidies have a big impact on how much landlords charge for renting out their land. Under cash leases, landlords get around 37%-38% of the subsidies, while under share contracts, they get 86%-88%. Different types of government programs also affect rental rates in different ways, depending on the program and leasing arrangement.