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  3. American Economic Journal: Economic Policy
  4. August 2016
  5. From Today's City to Tomorrow's City: An Empirical Investigation of Urban Land Assembly

From Today's City to Tomorrow's City: An Empirical Investigation of Urban Land Assembly

  • Leah Brooks
  • Byron Lutz
American Economic Journal: Economic Policy
vol. 8, no. 3, August 2016
(pp. 69-105)
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Abstract

Because cities are constrained by the boundaries of land ownership, fundamental urban modifications require land delineation changes. We evaluate whether there is enough land assembly--the joining together of two or more parcels of land--to put land to its highest value use. We hypothesize that in the absence of market frictions such as holdouts, the price of land sold for assembly should not exceed the price of land sold for other uses. Empirically, we find that to-be-assembled land in Los Angeles trades at a 15 to 40 percent premium and conclude that significant frictions prevent assembly.

Citation

Brooks, Leah, and Byron Lutz. 2016. "From Today's City to Tomorrow's City: An Empirical Investigation of Urban Land Assembly." American Economic Journal: Economic Policy, 8 (3): 69-105. DOI: 10.1257/pol.20130399

Additional Materials

JEL Classification

  • K11 Property Law
  • P14 Capitalist Systems: Property Rights
  • Q21 Renewable Resources and Conservation: Demand and Supply; Prices
  • R14 Land Use Patterns
  • R30 Real Estate Markets, Spatial Production Analysis, and Firm Location: General
  • R52 Regional Government Analysis: Land Use and Other Regulations
  • R58 Regional Development Planning and Policy
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