EU Land Markets and the Common Agricultural Policy

Economic theory and empirical findings suggest that the way in which agricultural support is provided has an influence on land markets. Support payments tend to become capitalised into land values to some degree, affecting both the sales and rental prices of land. These effects in turn have a bearing on the transfer efficiency of the support and structural change in agriculture. Since 2005, the EU has provided decoupled support to farmers through the single payment scheme (SPS), as part of the reform of its common agricultural policy. This book investigates whether the SPS has led to the capitalisation of support into land values in the EU, and if so, to what extent. Drawing from a combination of data sources – including Eurostat, the Farm Accountancy Data Network, 11 country and 18 regional studies – this extensive empirical analysis offers preliminary evidence of the reaction of EU land markets and asset values to the changes in policy.