Land Stewardship and Development Behaviors Under an Ecological-Impact-Weighted Land Value Tax Scheme: A Proof-of-Concept Agent-Based Model

Dakota B. Walker (), Alican Mertan, Joshua Farley, Donna Rizzo and Travis Reynolds
Additional contact information
Dakota B. Walker: Department of Community Development & Applied Economics, University of Vermont, 146 University Place, Burlington, VT 05405, USA
Alican Mertan: Department of Computer Science, University of Vermont, 33 Colchester Ave, Burlington, VT 05405, USA
Joshua Farley: Department of Community Development & Applied Economics, University of Vermont, 146 University Place, Burlington, VT 05405, USA
Donna Rizzo: Gund Institute for Environment, University of Vermont, 210 Colchester Ave, Burlington, VT 05405, USA
Travis Reynolds: Department of Community Development & Applied Economics, University of Vermont, 146 University Place, Burlington, VT 05405, USA

Land, 2024, vol. 13, issue 11, 1-25

Abstract: Sprawling land development patterns have exacerbated ecological degradation, social fragmentation, and public health problems. Perverse incentives arise from the ability to privatize collectively created value in land rents and socialize ecological costs. Land value taxation (LVT) has been shown to encourage urban infill development by reducing or eliminating rent-seeking behavior in land markets. However, despite its purported benefits, this tax reform is value monistic in its definition of optimal land use and, therefore, does little to address the lack of non-market information to inform land use decisions. We propose an ecological-impact-weighted land value taxation policy (ELVT) which incorporates the ecological footprint of land use into one’s land value tax burden. We test both proposed policies (LVT and ELVT) relative to a “status quo” (SQ) property tax scheme, utilizing a conceptual spatially explicit agent-based model of land use behaviors and housing development. Our findings suggest that both tax interventions can increase the capital intensity and decrease the land intensity of housing development. Furthermore, both tax interventions can lead to a net profit loss for speculators and a decrease in the average housing unit price. The ELVT scheme is shown to significantly increase urban nature provisions and dampen the loss of ecological value across a region.

Keywords: suburban sprawl; housing; land value tax; ecological deficit tax; agent-based model; private conservation; pro-environmental practices (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q24 Q28 Q5 R14 R52 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2073-445X/13/11/1795/pdf (application/pdf)
https://www.mdpi.com/2073-445X/13/11/1795/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jlands:v:13:y:2024:i:11:p:1795-:d:1511035

Access Statistics for this article

Land is currently edited by Ms. Carol Ma

More articles in Land from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().