Both the fluctuation and ever increase of farmland prices affect the utilization and preservation of farmland. Farm operation will result in either expansion or closure due to the change of farmland prices. Through the review of literature, this study attempts to analyze the changes of and major factors affecting farmland prices in the U. S. and Taiwan. In the U. S., farmland prices have been mainly influenced by land productivity (roughly 50%); other factors are large zoning of agricultural land, financial variables (the rate of interest; inflation etc.) and urbanization near metropolitan fringes. In Taiwan, in 1950's and early 1960's, farmland prices were influenced by land productivity (government payments and technological improvement) which still contributes the increase of land value, but with decreasing share. Farmland prices have been mainly influenced by the high man-land ratio, increasing demand for non farms uses and the expectation of increasing value resulting from the transfer of land uses from farm to non-farm. In Taiwan, how to combine farmland prices and economic change will be an issue deserving for further research.
