Impacts of Paddy-Field Consolidation Projects on Farmland Rental Transactions: Application of Discrete Choice Model

In order to reallocate farmland to efficient farmers, improvement in Farmland Rental Transactions (FRT) cooperating with public investment, Paddy-field Consolidation (PC) projects, is one of the most important policy issues in Asian monsoon regions as well as in Japan. Unfortunately, there are few empirical studies on FRT due to a lack of flexible data under regulated markets. This study aims to analyze FRT and to evaluate the effect of PC projects by modeling both supply and demand sides of farmland renting with micro-data from a discrete choice type questionnaire. Empirical results show that (i) effects of PC project appear as a remarkable increase in the rental rate and a moderate increase in the rental agreement level, (ii) there is an economic inefficiency in the Japanese rental market, but such an inefficiency can be reduced by PC project implementation, and (iii) regional differences in project effects are caused by differences in agricultural and social situations.

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Journal Article
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Japanese Journal of Rural Economics, 07
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JEL Codes:
C25; D44; Q12; Q15; Q38; R58

 Record created 2017-04-01, last modified 2019-08-30

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