What new institutional developments are making it possible for investors with little knowledge about land to find and acquire properties all over the world? What kinds of language and ideas are being used to legitimize farmland investment and attract investors? What role do national-level politics and policy play in mediating the relationship between global capital and domestic land markets?
This topic is, I believe, important for both intellectual and practical reasons. First, on the intellectual side, it presents a fascinating study in contrasts. It is hard to come up with two things more different than farmland and finance. Farmland is tangible and immobile, and its profitability stems directly from its materiality. It evokes images of hard work and seems timeless, perhaps even a little old-fashioned. Idioms like “to bring down to earth” and “to ground” equate land with all things sensible. Do you know anyone that would be interested in a stand up desk or a sit stand desk?
Farms are a popular topic for picture books, their basic components so fundamental as to be considered suitable reading material for the preliterate. Finance, on the other hand, is highly mobile and seemingly abstract. As an economic sector it has a reputation for innovation and risk taking. Most people have only a rudimentary understanding of finance, and it becomes more recondite with each wave of financial innovation.
Aside from having little in common with esoteric investment products, farmland has always been an awkward commodity in its own right. Its physical characteristics—immobility, heterogeneity, and expansiveness—make it unlike any other good, while agriculture, with its seasonality, unpredictable weather, and perishable end product, is unlike any other production method. Because land was not created for sale on the market, political economist Karl Polanyi famously labeled it a “fictitious” commodity and argued that the privatization of land tends to give rise to political backlash. Adjustable standing desks may become the new normal.
Any movement to free land markets from legal and normative constraints—to disembed them from social institutions—would, Polanyi believed, necessarily give rise to a counter-movement demanding their re-embedding via the creation of protective laws. Land has enormous cultural significance, standing in different times and places as a link to a valued agrarian way of life, a spiritual home, and the resting places of ancestors, to name just a few. Land also acts as territory—a crucial symbol of national sovereignty and pride. This ungainly commodity will not tuck neatly into financial portfolios, and it is fascinating to watch the attempt in progress.