A Shock to the System: How can Land Value Taxation change the Face of Cities?

A Shock to the System: How can Land Value Taxation change the Face of Cities?

Pruyt, E.
Tsaples, G.
Kovari, A.
Vasilopoulos, C.

Technology, Policy and Management

Multi Actor Systems

2013-07-21

This paper deals with implementing land value taxation in a city. The System Dynamics method is used to gain insights regarding the consequences such a policy would have on the city’s growth. The hypothesis that when all taxes except for the land-value tax are suddenly eliminated the construction of new houses and new businesses will be reinforced is tested under different scenarios. The model used is a simplified version of the Urban Dynamics model by J. Forrester (Forrester, 1969), with the urban area being divided in 4 zones. The results showed that the implementation of a land value tax and the nullifying of all the other taxes generates results and behaviors, which are almost the same as in the case where all the taxes existed. On the other hand, if the land value tax is introduced from the beginning- with no other tax present- the city gets the most beneficiary results. Finally, the time of the implementation, but also the level of the land value tax are two crucial factors, which could generate unwanted results.

land value taxation
urban dynamics

http://resolver.tudelft.nl/uuid:4685a6f9-5655-474b-a5e9-4703afa1dc93

System Dynamic Society

978-9-935056-12-06

Proceedings of the 31st International Conference of the System Dynamics Society, Cambridge, Massachusetts, USA, 21-25 July 2013

Institutional Repository

conference paper

(c) 2014 The Author(s)