There is considerable interest in the determination of farmland values. Although alternative models exist, present value models have played a central role in recent studies of agricultural land markets. Alston (1986) uses a present value model to examine the effects of inflation and real growth in net rental income on farmland prices (see also Melichar, 1979). Present value models also underlie analysis of the dynamic behavior of farmland prices by Burt (1986); investigation of causality relations between farmland rents and prices by Phipps (1984); and analysis of the relationship between agricultural and nonagricultural land markets by Robison et al. (1985).