Regional Differences of Agricultural Land Market in Slovakia: A Challenge for Sustainable Agriculture

Abstract

The agricultural land market and its legal and political limitations play an important role in sustainable agricultural production. This study analyzed the agricultural land market in particular regions of Slovakia in terms of the sustainability of agricultural production. We focused on the development of proposed land prices between 2014 and 2018 to find out whether the prices proposed by landowners align with administrative land prices reflecting the soil quality in particular regions of Slovakia, or whether they are influenced by the proposed land prices of neighboring regions. Moreover, we focused on the existence of regional differences in proposed land prices in Slovakia, including differences in supply prices of arable land and permanent grasslands in particular regions. Statistical induction tools, together with multiple range tests and spatial autocorrelation, were used to confirm or refuse our expectations. We confirmed statistically significant differences in proposed land prices between regions. Moreover, we found that landowners are only influenced by the proposed land prices of their neighboring regions to a slight degree. However, we found that the price scissors between proposed land prices and administrative land prices open towards smaller administrative land prices, meaning that land of poorer fertility is supplied at a higher price than land of the best soil quality. There is a risk that expensive and poorer land plots will be used by investors for non-agricultural purposes, and agricultural production will be crowded out from these regions. Therefore, we propose that changes to the prepared legislative measures are necessary in order to promote the sustainability of agricultural production in all regions of the country.