Affordable Access

Publisher Website

The Economic Consequences of Regulatory Taking Risk on Land Value and Development Activity

Authors
Journal
Journal of Urban Economics
0094-1190
Publisher
Elsevier
Publication Date
Volume
41
Issue
1
Identifiers
DOI: 10.1006/juec.1996.1089
Disciplines
  • Economics
  • Law

Abstract

Abstract In this paper the real options approach to land valuation is extended by: (i) showing how land value may be adversely effected when localities threaten a regulatory taking with less than full compensation, (ii) quantifying the resulting probability of development, which may increase in an attempt to thwart the taking of development rights; and (iii) measuring the value of lost income on an ex ante basis when an interim taking occurs. We find that the economic impact of such regulation can be substantial, which has implications for measuring just compensation claims as well as for general land use regulatory policy and related legal theory.

There are no comments yet on this publication. Be the first to share your thoughts.