In article , Torsten Brinch
writes

Most professions the salary is the only compensation component. Farmers
also have an asset (the farm) growing in value (long term).

That is afaik not measured in with farm income, since it is not income
from farming, not compensation for farming. I think it is better
expressed, farmers tend to be also land owners.

Roughly 2:1 vacant possession to tenanted. The added value is only of
use if there is no succession and is a disadvantage where values are
high compared with the earning capacity of the land.

OK, I can accept that. I must admit there would be some cost to the
farmer from renting the land from the owner, and that cost might well
be correlated to the value of the land. I'd expect the rent to the
land owner to be included among other costs in the farmers account of
his income.

Rent would relate to earning capacity rather than capital value. To an
extent there is a reverse effect, where *residential* farms have let the
land away to farming neighbours at less than a commercial rent yet have
paid highly to secure the farmhouse.

Rent is clearly an allowable expenditure and fully tax relieved.

Indeed there might farmers embodying in one, a grubby greedy *******
of a landowner, capitalizing on whatever his other component, the
resourceful, hardworking, chronically underpayed farm worker, might be
helped with to a better living, be it the technological progress or
direct subsidy made available to him by society.

Hmm.. I don't employ any farm workers. You may care to ask Oz if he
considers his men exploited or cosseted.
In the UK, there
actually has been conspicuously large increases in land value, and
conspicuously highly correlated, in almost perfect tune with the
McSharry reform.

Hmm.. again, these figures from John Nix (2002) bare land and over 2ha,

'87,£3955; '88, £5040; '89, £5620; '90, £7885; '91, £4800; '92, £3970;

'93, £4320; '94, £4940; '95, £5960; '96, £6780; '97, £7520; '98, £5905;

'99, £6240; '00, £6575;

I am not sure that the peak during '96/97 should be blamed on CAP re-
structuring. What caused the '90 one? Remember land is often used as a
shelter for investment funds when the stock market is heading in the
wrong direction.

Nix has correlated land values back to 1937 and then applied an
indexation relating the actual to a *real* figure based on 1995 general
price levels.
There have been at least 5 peaks since W.W.II. Somebody has just handed
me a glass of mulled wine and I am much too idle to type out his
figures.


It might be instructive to have some input from America where land
values are, presumably, more closely related to what can be grown.

It would seem to be rather more on-topic to get some input from UK,
where you imply land values are less closely related to what can be
grown (and as I have pointed to, apparently closely related to the
level of subsidy given by society to the land owners.) If high land
values is or has become a problem for UK farm profitability, as you
seem to suggest it could be, we should certainly look into the matter
with some focus.

Subsidy is paid to the person farming the land and may have become
factored into rents.

David P might care to comment on how land prices have varied with
respect to inflation.

I am not sure that leads to anything. Afaics there is no correlation
between those two variables in the period we are talking about.

regards


--
Tim Lamb