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Abstract

Tenancy shares in agriculture are increasing - in Europe as a whole as well as in Austria. At the same time, soil degradation and erosion have increasingly become a concern. Since the early days of the science of economics, researchers have speculated that tenancy discourages farmers from making investments into productivity and soil conservation measures. Empirical evidence for this hypothesis has so far been mixed and is scarce for European countries. This paper investigates the impact of tenure on soil conservation behaviour of Austrian farmers by examining their crop choices. A regression analysis with farm-fixed effects shows that the effect of tenancy status for soil conservation behaviour is very weak or insignificant. However, differences at the level of the farm(er) exist. We speculate that the strong institutions surrounding the rental of agricultural land foster soil conserving behaviour of tenants.

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