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Entropy 2011, 13, 38-52; doi:10.3390/ OPEN ACCESS entropy ISSN 1099-4300 /journal/entropy Article An Information Approach to the Dynamics in Farm Income: Implications for Farmland Markets Matthew J. Salois 1 and Charles B. Moss 2,* 1 Department of Food Economics and Marketing, University of Reading, PO Box 237, Reading, Berkshire, RG6 6AR, UK; E-Mail: m.j.salois@reading.ac.uk 2 Food and Resource Economics Department, University of Florida, 1155 McCarty Hall, Gainesville, FL 32611, USA * Author to whom correspondence should be addressed; E-Mail: cbmoss@; Tel.: +1-352-392-1845 ext. 404; Fax: +1-352-392-3646. Received: 9 November 2010; in revised form: 17 December 2010 / Accepted: 22 December 2010 / Published: 24 December 2010 Abstract: The valuation of farmland is a perennial issue for agricultural policy, given its importance in the farm investment portfolio. Despite the significance of farmland values to farmer wealth, prediction remains a difficult task. This study develops a dynamic information measure to examine the informational content of farmland values and farm income in explaining the distribution of farmland values over time. Keywords: information theory; farmland markets; farm income PACS Codes: 89.65.Gh; 89.70.Cf 1. Introduction The topic of real estate bubbles has gained prominence amidst the recent housing market crash and financial crisis. The related issue of bubbles in the rural land market is equally important given that farmland is the most important a