What Drives the Global "Land Rush"?

Aug 2013 | 120

Authors: Rabah Arezki, Klaus Deininger, Harris Selod


We review evidence regarding the size and evolution of the "land rush" in the wake of the 2007-2008 boom in agricultural commodity prices and study determinants of foreign land acquisition for large-scale agricultural investment. Using data on bilateral investment relationships to estimate gravity models of transnational land-intensive investments confirms the central role of agro-ecological potential as a pull factor but contrasts with standard literature insofar as quality of the destination country’s business climate is insignificant and weak tenure security is associated with increased interest for investors to acquire land in that country. Policy implications are discussed.

JEL Codes: F21, O13, Q15, Q34

Keywords: Land Acquisition, Large-Scale Agriculture, Foreign Investments, Agro-Ecological Potential, Land Availability, Land Governance, Property Rights


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