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Unformatted text preview: I t'rrn.&r!il ll9lll !a. lle Dl I loi I L,b.n ldlG Evane, A. ttThe Determlnatlon of the of Land." Urban Studlee. 19g3. pp. Pf lCg O,.:.t'tlo rl([:tttgfrl.ut r I 9 - 1 2 9 . The Determination of the Price of Land Alan W. Evans lFirst rcceise.l Novemhar l98l; in frul fornr Decernber 19821 Summery. Reccirsd thcoricr of thc lud mrrlcl rrc imdcgurtc, slrrcc ticy ignorc lhc opply of lud, tt is hmrn thrt oc-cupier of lrnd rrc ourlly unrlllin3 to scll rt thc mrrlct pricc but rrqulrc compemrtion for bcing forccd to DorG. Incorporeting thir rs r thcory ofsupply into hod merlcl tbcory rtlows us to crplrln or prrdict thet (r) urben-sprrwt rill occur, in lhc rbrcncc of plrnning controlq (b) r dcrclopmrnt 3lin trx will rlor dorrn the retr of dcrclopmcal of land rnd iocrcrsr itr pricc, (c) $hcthcr lend is ownrr occupied or occlpird by tcnrnts wlll afrect its dcvelopmcnt, rnd (d) po*ers of computrcry purchrre mal be neccssery firr ceriein kindr of dcvclopmmt but mry crusc sociel costs. Despite the lip service paid by the authors of 'supply of land is totally ignored. lr is alwa1,:i introductory economic tcxtbooks to the importance implicitly or explicitly assumed that all tand is owncd of land as a factor of production, atong with labour by landowners who offcr leases to the highesr bidders and caprtal, little further study of land is thought u'ho then occupy thc land as tr-nanrs. Thus the price necessary for the training of economists, at either an of land is cssentially dcmand-dctcrmined. But u.hen undergraduate or postgraduate level, whereas the land is owncd and used by the same person (or firm) economics of labour and of capital are both he is both owner and uscr and so a theory of the intcnsively studicd. For this reason, if for no other, supply of land must reffert this double character. In the theory of the determination of thc price of land the third section of rhe paper I set our a theory of the which lics behind the thinking of most economists determinationof rhepriccofland rvhichincorporares and non<conomists tcnds to be simplistic and based a theory of the supply of land. lt is shorvn that rhis on the static anallsis lcarned in first 1'ear economics. explains various features of the land market, in lr the lirst pert of thispaper I brieffy set out a fairly particular the rvry rhar the imposirion of taxes on sophisticated r'ersion of this static thcory. dcvclopmcnt gains can rcsuh in an increase in the Fortunatell', *ith the growth of intcrest in urban price of land, and a decreasc in its supply, something cconomics in rccent ycars. lhcre has bcen somc which is unexplained by thc other. demand-orienred, theoretical dcvc'lopmenl and a dynamic modcl which theories....
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