A hedonic analysis of farm tractor auction prices

Abstract Used farm machinery values play a critical role in farm management and in assessing the financial health of the agricultural sector. However, the heterogeneity of machines, particularly regarding embedded technology and usage, complicates efforts to isolate the factors that influence prices. This study leverages a detailed dataset from Tractor Zoom to estimate the effects of machine characteristics and market conditions on auction prices of used 300 to 450 horsepower tractors. We find a nonlinear relationship between machine usage and price: tractors with fewer than 500 hours of use lose approximately $118 per additional hour, while tractors with more than 10,000 hours show only a weakly significant decline of about $2 per hour. We also document pronounced seasonal patterns, with lower prices during the Midwest crop-growing season. These findings provide new evidence on machinery valuation and offer updated insights to inform farmers’ machinery replacement decisions.