The Globalization of Farmland: Theory and Empirical Evidence

By Rabah Arezki, Christian Bogmans, Harris Selod

June 22, 2018

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Rabah Arezki, Christian Bogmans, and Harris Selod. The Globalization of Farmland: Theory and Empirical Evidence, (USA: International Monetary Fund, 2018) accessed September 19, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

This paper is the first to provide both theoretical and empirical evidence of farmland globalization whereby international investors directly acquire large tracts of agricultural land in other countries. A theoretical framework explains the geography of farmland acquisitions as a function of cross-country differences in technology, endowments, trade costs, and land governance. An empirical test of the model using global data on transnational deals shows that international farmland investments are on the aggregate likely motivated by re-exports to investor countries rather than to world markets. This contrasts with traditional foreign direct investment patterns where horizontal as opposed to vertical FDI dominates.

Subject: Agricultural commodities, Agricultural policy, Agricultural sector, Balance of payments, Commodities, Economic sectors, Foreign direct investment, Labor

Keywords: Agricultural commodities, Agricultural policy, Agricultural sector, Asia and Pacific, Dummy variable, Food Independence, Foreign direct investment, Global, Host-country remoteness, Investor country, Investor-country remoteness, Land acquisition, Land Governance, Large-Scale Land Acquisitions, Middle East, North Africa, Platform FDI, Remoteness term, Sub-Saharan Africa, WP

Publication Details

Pages:

45
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2018/145
Stock No:

WPIEA2018145
ISBN:

9781484362105
ISSN:

1018-5941

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