URBAN  LAND,  INEQUALITY  AND  TAXATION -- Revisited
"Most economists consider that land market price relativities are best left undisturbed (by government action). ... What we have therefore is a significant contrast with economic orthodoxy by a professional economist." -- Alan Ecob. "The market does not ensure that cities stop growing beyond an optimum size. Taxing site rents would help to eradicate the underlying tendency to urban sprawl, because those rents are invariably higher in cities than in rural areas. This would encourage more intensive and productive use of urban land." -- Frank Stilwell.   Economics Course at Centre for Thomistic Studies, John Young. "Good Government," February 1998
GOOD  GOVERNMENT
75 Back Contents 
image, orig size 32x13mm 3.89Kb, source unknown Internet Link Exchange Foot 77
LinkExchange Member
PAGE 8 -- GOOD GOVERNMENT, FEBRUARY 1998
Urban Land, Inequality and Taxation [-- Revisited]
Letter from Alan Ecob, in "Good Government"
Dear sir,
I was interested to read Mr Stilwell's December article 'Urban Land, Inequality and Taxation' (pp.3-6).

I commence with the realization that most economists consider that land market price relativities are best left undisturbed (by government action) so as to best reflect undistorted buyer preference (for example) the advantages of metropolitan living as compared with out in the Simpson desert.

Consequently, Mr Stilwell's perception of pronounced metropolitan bias as giving rise to inflated land values in cities like Sydney really caught my attention.

His proposed remedies of:

1. Restrictive zoning in metropolitan areas (p.3) and

2. Penal land taxes on metropolitan real estate to produce a 'powerful incentive for decentralization and regional development' (p.6) of rural areas appear also to be very strong medicine.

What we have therefore is a significant contrast with economic orthodoxy by a professional economist. No doubt Mr Stilwell has a rational basis for this contrasting view. Would not the readers of Good Government be most interested in it?

Alan Ecob


Frank Stilwell replies

Alan Ecob has summarised the situation well. Orthodox economics has great faith in the market. The problem is that there is no natural harmony between individual and collective interests, because individual market decisions can generate adverse 'externalities.'

This is most obvious in the major urban areas. Their further expansion generates persistent problems of congestion, excessive travel times, environmental degradation and growing socio-economic inequalities.

The market does not ensure that cities stop growing beyond an optimum size. Taxing site rents would help to eradicate the underlying tendency to urban sprawl, because those rents are invariably higher in cities than in rural areas. This would encourage more intensive and productive use of urban land. It would not constitute discrimination against urban landowners, simply a recognition that urban land is capable of generating higher income for its owners.

Taxing that surplus would reduce land speculation, relieve the burden of other taxes and promote more balanced regional development.

__ END of article __

Frank Stilwell is an Associate Professor in the Department of Economics at the University of Sydney.
A profile on him is at: http://www.usyd.edu.au/su/econ/staff/stilwell.htm
Published work includes these books: 1.Regional Economic Policy, London, Macmillan, 1972 (also published in Spanish and Turkish).; 2.Australian Urban and Regional Development, Sydney, Australia & New Zealand Book Co., 1974; 3.Normative Economics: An Introduction to Micro-economic Theory and Radical Critiques, Sydney, Pergamon Press, 1975 (also published in Italian); 4.Readings in Political Economy, (Edited, with E.L Wheelwright), Sydney, ANZ, 1976, 2 volumes; 5.Economic Crisis, Cities and Regions, Sydney, Pergamon Press, 1980; 6.The Accord and Beyond: the Political Economy of the Labor Government, Pluto Press, Sydney, 1986; 7.Understanding Cities and Regions: Spatial Political Economy, Pluto Press, Sydney, 1992; 8.Beyond the Market: Alternatives to Economic Rationalism (Edited, with S. Rees and G. Rodley), Pluto Press, Sydney, 1993 (also published in Japanese); 9.Economic Inequality: Who Gets What in Australia, Pluto Press, Sydney, 1993; 10.Reshaping Australia: Urban Problems and Policies, Pluto Press, Sydney 1993.
ECONOMICS COURSE AT THE CENTRE
FOR THOMISTIC STUDIES

John Young will give a course based on his book The Natural Economy
Beginning on February 23 [another term to begin July 27, 1998], each talk will be from 6 pm until 7 pm, on Monday nights for four terms
The fee is $30 per term
The venue: St Andrew's House, Level 8, 474 Kent Street, Sydney
(near Town Hall Station)

Further information can be obtained from John Young, telephone (02) 9858 4703
...
Good Government is published in every alternate month.   Send annual SUBSCRIPTIONS plus Membership $20 (or $14 concession), or Subscriptions without Membership $18 ($12), to The Association For Good Government (Editor: Richard Giles), PO Box 443, Enfield, NSW, 2136, Australia, Tel (02) 9744 8815 and (02) 9319 3313, Fax (02) 9744 3804
CLICK THESE SERVICES
[ Diary ] [ 1st Guest Book ] [ 2nd Guest Book ] [ Visitors ] [ Links ] [ Readings and Books] [ Page-making ] [ Meeting room ]
or contact any Geonomics office for subscriptions to MAGAZINES

All Rights Reserved to the owner/s of Copyright© and Registered® Trade Marks™. See Disclaimer, Copyright and Trade Marks
This Website is connected through Multiline; and is a member of various banner systems (all free).
[ CONTENTS ] [ HOME ] [ Esperanto Hejmo ] [ Italiana Focolare ]
[ 75 ] [ Back ] [ Links ] [ Diary ] [ Visit ] [ Discuss ] [ E-mail ] [ Top ] [ 77 ]
Page's main content by Alan Ecob, Frank Stilwell, and John Young, created with TekNet's HTML Pro32© by John Massam 22 July 1998; ~2 A4 pages. last revised 30 Jul 98
The opinions expressed on this Website and its links are those of the author/s, and not necessarily those of the Association.
DOC 76:   URL = http://www.multiline.com.au/~georgist/good98feb5.htm   E-mail: georgist@multiline.com.au
Authorised: John Charles Massam, Georgist Education Association Inc., 10 Broome Street, South Perth, Western Australia, 6151. Tel.: (08) 9367 5386
<embed src="chestnut.mid" HIDDEN CONTROLLER="FALSE" autostart="true">