The Impact of the SFP System on Italian Farmland Prices and Tenure Contracts

The connection between policy and other context variables and land markets is at the core of the policy debate, including the present reform of the Common Agricultural Policy. Factor markets are a central issue in analyses of farm development and of agricultural sector vitality. Among the different production factors, land is one of the most studied. The land market is an imperfect market, because of its low substitutability, poor transparency and high transaction costs. It is characterised by a low number of transactions and a local dimension, and is also influenced by economic, policy and institutional frameworks. In particular, the agricultural economics literature has highlighted the effects of the Common Agricultural Policy (CAP) on factor markets (Floyd, 1965; Parsch et al., 1998; Latruffe and Le Mouel, 2006; Ciaian and Swinnen, 2006; Bartolini et al., 2011) and specifically studied the way in which the CAP reforms have changed these effects over time. The aim of this paper is to contribute to the estimation of the potential effects of the CAP reform on propensity to transaction, particularly comparing the effect of different new instruments/policy settings with the current policy (CAP health check) used as a baseline. The work is focused on three of new policy instruments within the post 2013 CAP reform proposal: regionalization, greening and capping. The first and second are analysed in more detail. The analysis will be based on a survey of farmers in the Province of Bologna, Emilia Romagna, Italy. The questionnaire focuses on mechanism of access to land and related incentives towards different land use/economic behaviour. The survey includes information about respondent characteristics (farm, farmer, household and payments received) and stated intention about potential changes in land operated under alternative agricultural policy scenarios (particularly the post-2013 reform proposals)