Is paying below-market cash rent for good land unethical, or just smart business practice?

What about offering above-market rent to get land away from the current tenant?

And what’s wrong with using your greater knowledge of local rental markets to your best advantage?

It’s not always easy to distinguish between unethical behavior and savvy dealing, says Kevin Dhuyvetter, an ag economist at Kansas State University.

One test he applies: Have you, the tenant, been honest and candid with your landlord? Have you strived to keep the owner informed of current rental rates? There’s nothing wrong with a landlord giving you a break on the rent, he says, as long as concessions are made with full knowledge.

But if your attitude is, Why should I pay more rent if the landlord doesn’t ask for more, “it looks like unethical behavior,” Dhuyvetter says. That’s especially dishonorable if you’re dealing with elderly landlords, who are often vulnerable or out of touch, says Bruce Johnson, a University of Nebraska Extension economist.

What about paying above-market rent to lease a new farm? If you offer more money because you can operate the land profitably – due to your management abilities, economies of scale or growth potential – that’s fine in Dhuyvetter’s book.

But if you deliberately overbid to acquire the land and then let the rent stagnate in coming years because it’s not profitable – or worse, beg for lower rent, taking advantage of your landlord’s reluctance to change tenants – that’s not ethical, Dhuyvetter says.

The real litmus test for ethical dealing is whether you “Can you look at yourself in the mirror at the end of the day?” Dhuyvetter says.