Henry George and the Institution of Private Property in Land: A Property Rights Approach

Abstract . Conflicting statements concerning whether the implementation of Henry George's single tax proposal would destroy the institution of private property in land have appeared in the literatures of economics and other disciplines. A number of writers have implied that the taxation of Ricardian rent is equivalent to land nationalization. In the main, followers of George have denied that the single tax would abolish private property in land. Their claim is based on the fact that land titles would remain in private hands under the single tax. Since the whole question of private property is beset with ideological difficulties, a property rights approach is applied to this issue in an attempt to resolve the controversy. The conclusions are that the actual implementation of George's system would not destroy private property in land and that it is incorrect to equate the single tax with land nationalization.     

On Modernizing Local Public Finance

Abstract . Urban economists tend to agree that land value taxation is both equitable and efficient. Then why won't American urban areas reform their property taxes into a land value tax? One explanation may be that the climate of opinion is that the taxation of wealth is wrong. This may be another of the legacies of the Great Depression. In the 20 years preceding, levels of property taxation increased very substantially; this was associated with rapid urbanization and big increases in public expenditures. Even with the collapse of property values urban governments extended expenditures and hence taxes on real property—as they did again with inflation in the 1970s. But in the 70s residents were predominantly owner-occupants—a result of counter depression policy. Their hostility to taxing unrealized capital gains is the obstacle advocates of land value taxation have to overcome.     

An Address by a Georgist Sympathizer: Practical Issues in Georgist Thought

The justice and soundness of the taxation of land rent is acknowledged but problems in assessing imply a need to introduce better methods. This is particularly true when attempting to introduce the more saleable idea of two-rate tax systems because the allocation of total value of real estate parcels between land and buildings is even more arbitrarily done than determining the total assessment. The ideas fit best at the local level and there is little chance of replacing income or sales taxes. A 100% tax would be impossible since it would lead to an avalanche of tax appeals and the abandonment of some land since a high percentage of assessments are in error. The idea of a single tax does not fit modern times when revenue needs determine taxes, rather than the amount of revenue collected determining proper or necessary government expenditure levels. One tax source may be unpopular and regarded as a dangerous concept. Land is probably less important and less relatively valuable than it used to be because of technological change. Some advances in social legislation may mitigate the need for the drastic reform, George who was a moralist deeply concerned about poverty, felt reform was needed in his day. He was right about the impacts of various taxes on economic activity and income distribution.     

Public Spending, Land Taxes and Economic Growth: An Empirical Analysis of the Adequacy of Land as a Tax Base

Abstract . Site value taxation is often cited as desirable on efficiency grounds, but is all too often dismissed for alleged lack of revenue potential. This paper empirically tests the revenue adequacy of site value taxation. Revenue adequacy in this study is defined as the ability of the tax base to keep pace with community expenditure needs. The paper concludes that communities with higher than average rates of capital growth and with a relatively constrained land area will find land taxes when subsituted for present property taxes, quite adequate for future as well as present needs.     

Important Issues and Serious Problems in Flat-rate Income Taxation

Abstract . Dozens of important issues are connected with the proposal of flat-rate income taxation How much, if any, activity would leave the underground economy for the reported one? Would effort and saving change? Would efficiency in the allocation of business and personal resources he effected? High rates of taxation and differences in tax rates influence behavior for better or worse. Serious proposals to change them deserve serious consideration, but difficult though not insuperable problems are involved and must be studied.     

The Vermont Land Gains Tax Experience With It Provides a Useful Lesson in the Design of Modern Land Policy

Abstract . Vermont is currently the only state which employs a special capital gains tax on certain land sales. A comparison between the Vermont land gains tax and Henry George's Single Tax provides a useful lesson in the design of modern land policy. The Vermont tax is aimed at discouraging short run land speculation, while the Single Tax seeks to discourage the long term quasimonopoly of land ownership. The Single Tax would capture unearned increments to land value while the Vermont tax applies only to realized capital gains and tends to reward long term speculators. An empirical analysis of the Vermont tax reveals that tax revenues have been small, and that the tax has not prevented a rise in land values. In fact, the Vermont tax may have increased land prices by restricting available land supply. Although the Vermont tax intended to curb speculation and reduce land subdivision activity, it is not a substitute for land use planning and carefully designed growth control ordinances and regulations.     

How Much Revenue Would a Full Land Value Tax Yield?In the United States in 1981, Census and Federal Reserve Data Indicate It Would Nearly Equal All Taxes

Abstract . Most urban economists and particularly specialists in urban public finance consider the land value tax, because of its economic effects and its influence toward rational development, the tax of choice. But could it replace, in whole or in large part, taxes which now burden labor and capital and distort efficient allocation of resources? How important would a full land rent tax's yield be? The U.S. Bureau of the Census provides data which, adjusted for errors and omissions, indicates that the annual land rent for 1981 was $721 billion. Federal Reserve Board data, similarly adjusted, indicates annual land rent for that year was $590.38 billion Hence we may say that a full land rent tax would yield something around $658 billion in 1981, or 28 percent of the 1981 national income. This is nearly two thirds of all taxes levied by all levels of government in 1981, and, with user charges and similar fees continued, it is probably equal or nearly equal to burdensome taxes.     

A Reply to Liu's Critique

A bstract . In his comment on our paper. "The Economic Effects of Land Value Taxation: An Empirical Test," Professor Ben-chieh Liu criticizes the structure and specification of our model and indicates the existence of data deficiencies and testing problems. Professor Liu raises some interesting questions, but he does not offer any concrete evidence to refute our original conclusion that the land value tax (LVT) is not superior to the real property tax in terms of stimulating urban development. Since the LVT represents a radical departure from current tax policy , which would lead to significant changes in the distribution of income , the burden of empirical evidence rests on those who believe that it is superior.     

Poverty and Mass Unemployment in Mineralrich Botswana

Abstract . The economic plight of Botswana's poor has worsened as a direct consequence of the mining sector's success. Their condition results from the process by which economic expansion and modernization has taken place. It has created an economic elite composed of a government bureaucracy and an emerging military “salariat,” and a small group of corporation officials and managers. The elite have joined white farming families as the country's largerscale land and cattle owners, purchasing land and cattle from savings out of relatively high salaries in the mining and public sectors. They have drilled boreholes for water and mechanized their farms and ranches. In effect, the elite have enjoyed access to the revenue from mining; their wealth is a product of that sector's growth, and the consequence is the emergence of a dual Botswana. One is rich, the other is poor, and the emerging clash between rich and poor could destabilize and threaten an African success story.     

Henry George and the Classical Scientific Research Program: The Economics of Republican Millennialism

Abstract . Henry George's classicism was evident in his acceptance of “hard core” assumptions inherent in classical economic analysis, notably that rational self-interested behavior exercise in competitive markets maximized economic welfare. However, George's “stage theory,” the “Law of Human Progress,” led him to reject the classical nexus between social and economic welfare. The emergence of an exchange economy improved efficiency and economic welfare, but institutional changes lagged behind, particularly the redefinition of property rights. Consequently, economic growth based on land as a private rather than public good widened the gap between economic efficiency and social welfare. Hence George's paradox of poverty amidst progress. George resolved the equity efficiency conflict by treating land as a public good. Then, the sale of monopoly rights to land through the “single tax” on land rents captured the difference between the private and social costs of land use.     

Henry George and Europe

Abstract . Henry George's land reform ideas became known in Germany not through his writing or speaking but through the efforts of Michael Flürscheim, an industrialist and pioneer social reformer, who first presented those ideas to the public. The American's idea that the land value tax was the only legitimate source of government revenue as the only economic surplus had found no acceptance among German socialist leaders. It was a capitalist, Flürscheim, who was inspired by George's theories and wrote and spoke about them. Flürscheim brought about the foundation of the first German land reform organization. Though it failed, a successor became the largest such association in the world.     

Site Value Taxation and Manvel's Land Value Estimates

Replacement of the existing property tax with a. tax on site value requires that the site value base be sufficiently large to generate the same revenue as the existing tax. The adequacy of the site value base is examined in view of Manvel's land value/property value estimates. The conclusion is that only partial replacement may be feasible in many cases, but this may still produce a desirable effect.     

Some Surviving Elements in the Work of Henry George

Abstract . While not appreciated by many professional economists during his lifetime despite his appeal to the general public, Henry George (1839-1897) was a self-taught economist whose best work is still surviving. His work is still applauded by economists in their theoretical work especially in the area of site value taxation and rentseeking. However, perhaps the most enduring tribute to the genius of Georgism is in the current application of land value taxation and gradation in several countries around the world including the United States.     

Absentee Ownership of Farmland and State and Local Tax Policy: Income Tax Promotes Absenteeism, But the Property Tax Can Be Used to Strengthen Family Farms

Abstract . The incentive effects of state and local tax policies in promoting or inhibiting the ownership of farmland by non-operators are evaluated. Previous research on the economic, social and environmental effects of absentee ownership is reviewed as well as evidence regarding the impact of tax laws on absentee owners versus owner-operators. The Federal tax laws, it is found, work to increase land prices, reduce entry into farming by young farmers, and increase absentee ownership. State income tax policies may reinforce these effects. Property tax policies, on the other hand, may counteract income tax laws by giving tax relief preferentially to owner-operators. Several modifications of property tax relief programs are suggested.     

Taxation for Low Cost Wood Fiber*

Abstract . If forest industry taxation is to be put on a sound economic basis, the Federal Government, the largest land owner, should pay the same taxes as any other landowner, so that the social and economic effects of taxation are realized. Specialists report that the form of the property tax preferred for the taxation of the property of the forest industry, under most circumstances, is land value taxation, not the property tax based on income realized at some point In the future which presumed the continued existence of virgin forests. This paper recognizes that the forest industry now is based on harvests of tree crops and proposes a further development of the land value taxation principle in the form of a forest tax composed of a land value tax combined with a tax on tree growth which increases as growth as a percentage of volume growth decreases with the tree's increasing age.     

Community Classification and Growth in Effective Property Tax Rates: A Case Study of Rate Divergence in 39 Rhode Island Towns

Abstract . A multiple regression analysis of cross-sectional data for 39 Rhode Island towns indicates that variation in the level of effective property tax rates among communities can be substantially explained. The determinants are a community's population density, median family income, real property per capita, and the ratio of commercial to total property tax, revenue. Population density serves as a criterion for judging the “cityness” (1) of a community, that is, its degree of urbanization. A positive relationship exists between population density and effective property tax rate. Communities with the highest population density tend to have the highest tax rates. This relationship is shown in each analyzed year. Covariance analysis applied to the regression coefficients for the various years reveals a significant change in the population density coefficient. This coefficient change indicates a divergence in effective property tax rates among city, suburban, and rural communities.     

Henry George's Impact at Home and Abroad: He Won the Workers of Marx's Adopted Country But Through Leninism Marxism Has Won Half the World

Abstract . Henry George, the American economist and social philosopher, considered it an anomoly that, under modern industrial conditions, progress and poverty should march together. He recognized that the juxtaposition of wealth and want was a worldwide phenomenon and traced its cause to monopoly, particularly the monopoly of land and natural resources. Realizing that current taxes on consumption and production were disincentives to capital and labor, he proposed that governments tax the only true surplus, economic rent, through land value taxation. This would enable the people to reassert their common title to the land—the earth. His message was accorded a more favorable reception abroad than at home. Karl Marx wrote Das Kapital in England but it was George, not Marx, who appealed to the British workers. Yet it was Marxism that swept half the world into State socialism, conquering by political power and bayonet-Leninism while George's followers pursued the democratic approach of public education.     

In Perpetuity: Some Reflections on Literary Views of Land and Other Forms of Property

Some of civilization's finest minds have focused on societal problems and reported the result in literary works. Literary sensitivity and sensibility ought to provide insight on the value consequences and normative dimensions of social science theorizing. These hypotheses are tested against some of the ideas on property, particularly property in land, in great works of literature, contrasted with some analogous ideas from economic theory. No sweeping generalizations or policy conclusions were sought or found; insights were obtained as aids or guides for economic inquiry. But, interestingly, many of the literary views were in substantial accord with views on land and property espoused by Henry George, views which, as he noted, have a history extending into ancient and possibly prehistoric times.     

Groundwater and the Land Value Tax

Abstract . Application of the land value tax has been described for many natural resources. However, the problems encountered with flowing underground resources have not been fully discussed. Groundwater is one such flowing resource that affects the value of surface land. The underground water is also subject to its own market forces. If a Georgist tax is to be applied to groundwater or to land affected by it, the administrator of the tax must consider the interplay that occurs between the two resource markets. A system of separable property rights to the two resources offers the prospect for efficient use. But the monitoring of ground water use must accompany such a separation.     

房地产税改革与土地财政困局破解——基于对地方财政影响的情景分析

地方政府过度依赖土地出让收入是当前中国公共管理面临的重要难题。改革房地产税制并触发土地制度的连锁反应是破解中国土地治理困局的基本出路。通过预测不同改革方案下典型城市住房相关土地财政收入变化,评估房地产税替代土地出让（纯）收益成为地方支柱性收入源的前景。研究发现,如果合理设计覆盖城市存量和新增住房的房地产税,可在短期内保证地方土地财政收入的相对稳定,并在远期实现房地产税替代土地出让金成为地方财政支柱的目标,增强土地财政收入的可持续性。近期政府应改变“重流转、轻保有”的状况,将房地产税培育成为地方主体税种,远期应推进城乡一体化土地市场体系、土地出让制度和土地增值税制度联动改革,使地方土地财政收入从以一次性的土地出让纯收益为主向以持续的房产保有税、土地增值税等为主转变,促进政府土地管理本位职能回归,破解土地财政与政府治理困局。