Abstract
Classic Ricardian model indicates that the costs of farming are strongly associated with geographical factors including location, steepness, and fertility of farm land. Accordingly, when outputs price falls down, farm economy located at remote and marginal areas with the higher costs may become unprofitable, possibly leading to the abandonment of farm land.
The objective of this paper is to explore this Ricardian's assertion and analyze the factors affecting the formation of abandoned farm land. Spatial regression model is employed using agricultural census and its map data for Miyagi Prefecture, Japan.
The results of analysis indicate that the major factors of abandoning farm land are its geographical conditions, namely, the distance to city and the steepness of non-paddy fields. The estimation results also suggest that leasing of farm land be one of promising countermeasures to the abandonment problem. The higher rate of leasing farm land is expected to decrease the future abandonment more, thereby allowing for sustaining agricultural activities at remote and marginal areas. Further research is needed to observe the spatial and temporal effects of recent government policy that aims at reducing the abandoned farm land through leasing.
