Land Value Taxation and Housing Development

A bstract . The effects of land value taxation on housing development are studied in three disparate cities: Pittsburgh, McKeesport, and New Castle, Pennsylvania. These places are examples of three different types of city: central city, suburban city , and relatively isolated city , respectively. Shifting taxes from buildings to land is hypothesized to have different effects in the different types of cities. A liquidity effect , due to increases in the land tax rate , is expected to operate in all three types of cities. An incentive effect , due to decreases in the tax rate on improvements , is expected to function in central cities and, possibly, in relatively isolated cities. It is not expected to be important in suburban cities such as McKeesport. An incentive effect was found in Pittsburgh, but not in the other two cities. No evidence of a liquidity effect was found in any of the three cities. An explanation of why observed effects may not conform with hypotheses is given.     

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.     

Site Value Taxation and the Timing of Land Development

A bstract . Recent writers have challenged the traditional view that a tax on site value is neutral, but there is still disagreement as to the effects of the tax. The site value tax affects the timing of land development in that it provides an incentive for landowners to develop land sooner than under a property tax levied on improvements also. Confusion has resulted from a failure to distinguish market value from development value. The incidence of the site value tax must take into account the dynamics of untaxing capital and of the capitalization of the tax increase on land values , as well as of the resulting increase of land supply and its effect in further reducing land values. The increased profitability of capital improvements could then increase land rent from the demand side. Obviously, amidst such dynamic changes, the overall effect on land values and rents is unsettled pending further research.     

Mathis and Zech's 'Empirical Test' of Land Value Taxation

A bstract . The Land Value Tax , which proposes that governments raise their revenues largely from taxes on the annualized economic rent of land , has been projected into current debate by recent studies and by political debate in at least half a dozen Pennsylvania cities. An effort to measure its effects o n building construction and renovation was made by two Pennsylvania economists, E. f. Mathis and C. E. Zech. Under criticism, they granted that their conclusion that there was no evidence that urban development was stimulated was tentative and debatable. The effort was valuable in that it highlighted some of the pitfalls of this kind of research. In this area, researchers must try to avoid mis-specification of variables, wrong choice of flow or stock data, employment of oversimplified economic hypotheses. Public decision makers should be informed about inappropriate model specification and structure, input data deficiencies, and inadequate econometric analysis for urban policy determination.     

Land Value Taxation in Vancouver: Rent‐Seeking and the Tax Revolt

At the beginning of the 20^th century, Vancouver obtained international acclaim as a “single‐tax” city. Supporters claimed that land value taxation was responsible for the spectacular growth of the city. Even critics believed that it had produced a building boom and declining rents. Yet, over several decades, the system was scaled back and ultimately ended in 1984. This article argues that the property tax revolt can be understood with Mancur Olson's model of collective action. Property owners are better organized than other parties impacted by housing policy because they have financial resources and a salient economic concern in housing. Thus, the special interests of property owners in higher values and unrestricted use prevailed over the interests of tenants and prospective buyers. While the property tax revolt was often articulated in the progressive language of ability to pay, when confronted with progressive counterarguments, it collapsed into explicit arguments for rent‐seeking.     

Empowered Participation in Urban Governance: The Minneapolis Neighborhood Revitalization Program

In the early 1990s, the Neighborhood Revitalization Program (NRP) allocated $400 million in public funds for Minneapolis neighborhood groups to spend on improvement projects over the coming 20 years. NRP created the most financially empowered structure of neighborhood governance in any American city. This article describes the institutional design of NRP and then explores several of its political, social and economic consequences. In particular, we examine the character of participation, deliberation and conflict in several NRP neighborhoods, the tensions between neighborhood groups and city offices over this decentralization initiative, the effects of decentralization upon neighborhood‐level social capital, and the nature of goods funded under the Program.