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An analysis of the intention-realisation discrepancy in EU farmers’ land investment decisions

Author

Listed:
  • Marianne Lefebvre

    (European Commission, Joint Research Centre, IPTS, E-41092 Seville, Spain)

  • Meri Raggi

    (University of Bologna, Department of Statistical Sciences, I-40126 Bologna, Italy)

  • Sergio Gomez Y Paloma

    (European Commission, Joint Research Centre, IPTS, E-41092 Seville, Spain)

  • Davide Viaggi

    (University of Bologna, Department of Statistical Sciences, I-40126 Bologna, Italy)

Abstract
The article analyses the discrepancy between farmers’ investment intentions and the observed realisations. We focus on intentions to investment in land on the part of 171 farmers in 6 EU case study areas (collected in 2006) and their realised investments between 2006 and 2009. While the farmers who had no intention to invest mostly follow their plans, only 36% of those who intended to invest in 2006 have done so by 2009. We set up a recursive bivariate probit model in which intention is an endogeneous regressor of the realisation. We show that stated intentions are a reasonably good predictor of realised actions, and highlight drivers of the discrepancy between intentions and realisations, such as pessimistic expectations regarding the future of both agricultural markets and the farm when no successor is known. Some recommendations on the use of stated intention surveys to study the farming sector are provided.

Suggested Citation

  • Marianne Lefebvre & Meri Raggi & Sergio Gomez Y Paloma & Davide Viaggi, 2014. "An analysis of the intention-realisation discrepancy in EU farmers’ land investment decisions," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 95(1), pages 51-75.
    • Handle: RePEc:rae:jourae:v:95:y:2014:i:1:p:51-75
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    References listed on IDEAS

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    Cited by:

    1. Silvia Russo & Rino Ghelfi & Meri Raggi & Davide Viaggi, 2024. "Factors Affecting the Land Investment Decisions in the Old Members of the European Union: A Systematic Literature Review," Land, MDPI, vol. 13(4), pages 1-18, April.
    2. Demirdogen, Alper & Olhan, Emine, 2018. "The Timing Impact of Agricultural Support Policies on Farmers’ Stated Intentions in Turkey," 162nd Seminar, April 26-27, 2018, Budapest, Hungary 271960, European Association of Agricultural Economists.
    3. Marianne Lefebvre & Kim De Cuyper & Ellen Loix & Davide Viaggi & Sergio Gomez y Paloma, 2014. "European Farmers intentions to invest in 2014-2020: survey results," JRC Research Reports JRC90441, Joint Research Centre.

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    More about this item

    Keywords

    stated intentions; survey; agriculture; investment; land; recursive bivariate probit;
    All these keywords.

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods

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