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- Title
Land as a Differentiated Factor of Production: A Hedonic Model and Its Implications for Welfare Measurement.
- Authors
Palmquist, Raymond B.
- Abstract
The purpose of this paper is to develop a model of the derived demand for a differentiated factor of production (agricultural and) and to develop welfare measurement techniques that can be applied to various land and agricultural policy questions. While it is common to treat land as a homogeneous factor of production, each parcel of land actually has a large number of characteristics that will vary between tracts. These characteristics include characteristics that cannot be changed by the owner of the land and others that can be changed in response to market information. The owner cannot reasonably change the soil type or structure, the topsoil depth (although the rate of change in that depth can be influenced), the erosivity of the soil (although the amount of erosion can be affected), major topographic features or terrain, or climate including rainfall, temperature, and sunshine. Other features can be changed such as drainage, terracing, changing the pH or fertility, irrigation of the land, erosion control such as grass waterways or tillage techniques, and building structures on the land.
- Subjects
TRANSPORTATION; AGRICULTURE; FERTILITY; TILLAGE; AGRICULTURAL equipment; DRAINAGE
- Publication
Land Economics, 1989, Vol 65, Issue 1, p23
- ISSN
0023-7639
- Publication type
Article
- DOI
10.2307/3146260