The economics and externalities of agricultural land in the urban fringe
Date
2008-08-08T22:19:19Z
Authors
Stobbe, Tracy
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Abstract
The preservation of agricultural land, especially that which lies close to cities (in the so-called urban fringe), is a concern in many jurisdictions around the world. Agricultural land values change dramatically as farmland is located nearer to urban areas and development pressure has increased on these lands as urban populations have expanded. In British Columbia, Canada, a provincial-wide zoning system forbids the development or non-agricultural use of land without special permission. This system is explicitly designed to protect the capability of the land to produce food in the future, but it also implicitly protects the positive spillovers from agricultural land such as environmental services and open space. Three empirical papers comprise the original research in this dissertation. They seek to answer related questions about agricultural land values in the urban fringe. First, a statistical investigation is conducted into the factors that are associated with successful applications for exclusion from the agricultural zoning system. This study finds that a measure of distance (metres from the main highway) is highly significantly correlated with a parcel’s chances of being excluded. Next, a paper examines the trend of hobby farmers springing up in the urban fringe. Two different models seek to illuminate common trends in the types of parcels that hobby farmers choose, and the price that hobby farmers pay for the land, respectively. This study finds that hobby farmers seem to be very selective about the parcels they choose, likely trying to take advantage of favourable taxation rates for agricultural producers in place in the province. Lastly, a study seeks to understand how residential parcels’ values are influenced by the nearness to and view of agricultural land. Agricultural land in the study does not appear to exhibit an open space premium, though this could be influenced by uncertainty about the future use of the land. All the empirical work in this dissertation utilizes geographic information systems (GIS) technology that allows the calculation of distances to features of interest. Hedonic pricing models and binary choice models are the main statistical tools used.
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Keywords
Agricultural land, economics, geography, GIS, externalities, public goods, urban fringe, farmland, regional economics, environment, rent theory, history of economic thought