Taxation of Land and Economic Growth

Shulu Che, Ronald Kumar and Peter Stauvermann
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Shulu Che: Department of Global Business and Economics, Changwon National University, Changwon 51140, Korea

Economies, 2021, vol. 9, issue 2, 1-20

Abstract: In this paper, we theoretically analyze the effects of three types of land taxes on economic growth using an overlapping generation model in which land can be used for production or consumption (housing) purposes. Based on the analyses in which land is used as a factor of production, we can confirm that the taxation of land will lead to an increase in the growth rate of the economy. Particularly, we show that the introduction of a tax on land rents, a tax on the value of land or a stamp duty will cause the net price of land to decline. Further, we show that the nationalization of land and the redistribution of the land rents to the young generation will maximize the growth rate of the economy.

Keywords: taxation of land; land rents; overlapping generation model; land property; endogenous growth (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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