One of the main drawbacks I see in this system is that it provides little incentive for anyone to improve the value of their own property
Indeed. I would like to highlight a particular example of this failure, namely the construction of multi-story buildings. In the modern market, the landowner builds tall buildings (which is a very difficult, and hence expensive procedure) because the owner profits from the rent gained from the extra real estate area. Mako in the main post suggests “we don’t need land markets to help us to decide when and where taller buildings are needed, it’s not that hard to get it pretty much right”, but 1) in practice, similar proposals (that have actually been implemented, both in communist and nominally capitalist countries) have vastly underestimated the difficulty of this problem, leading to large problems that have made life harder for many people, and 2) if the landowner doesn’t have a profit incentive to build higher, who will pay the cost of building higher? The local government? I’d rather the local government’s limited resources be used to do something that can’t already be done by the free market.
1) in practice, similar proposals (that have actually been implemented, both in communist and nominally capitalist countries) have vastly underestimated the difficulty of this problem
The USSR and pre-1978 Communist China are notable examples which are highlighted in Alain Bertaud’s Design without Order, but also modern zoning laws in the US and other first-world countries suffer from smaller, but still significant versions of this failure.
It seems like the US and other first-world countries have problem with the government making laws limiting density. I would expect the same for pre-1978 Communist China as Mao wasn’t a fan of cities and wanted to move production to the country-side.
From what I understand the USSR actually did manage to build high-story buildings under Khrushchev.
in practice, similar proposals (that have actually been implemented, both in communist and nominally capitalist countries) have vastly underestimated the difficulty of this problem, leading to large problems that have made life harder for many people
Singapore and Hong Kong are two generally-capitalist cities that have employed largely government housing development of very dense, tall housing.
It worked REALLY well in capitalist, uber-wealthy Singapore (GDP per capita substantially higher than the USA). ~78% of Singaporeans live in housing developed by the Singapore Government’s Housing and Development Board (https://en.wikipedia.org/wiki/Housing_and_Development_Board). It works a bit less well in Hong Kong, but still remarkably well considering how many people are housed in the very small area available.
Indeed. I would like to highlight a particular example of this failure, namely the construction of multi-story buildings. In the modern market, the landowner builds tall buildings (which is a very difficult, and hence expensive procedure) because the owner profits from the rent gained from the extra real estate area. Mako in the main post suggests “we don’t need land markets to help us to decide when and where taller buildings are needed, it’s not that hard to get it pretty much right”, but 1) in practice, similar proposals (that have actually been implemented, both in communist and nominally capitalist countries) have vastly underestimated the difficulty of this problem, leading to large problems that have made life harder for many people, and 2) if the landowner doesn’t have a profit incentive to build higher, who will pay the cost of building higher? The local government? I’d rather the local government’s limited resources be used to do something that can’t already be done by the free market.
Can you point to examples?
The USSR and pre-1978 Communist China are notable examples which are highlighted in Alain Bertaud’s Design without Order, but also modern zoning laws in the US and other first-world countries suffer from smaller, but still significant versions of this failure.
It seems like the US and other first-world countries have problem with the government making laws limiting density. I would expect the same for pre-1978 Communist China as Mao wasn’t a fan of cities and wanted to move production to the country-side.
From what I understand the USSR actually did manage to build high-story buildings under Khrushchev.
Singapore and Hong Kong are two generally-capitalist cities that have employed largely government housing development of very dense, tall housing.
It worked REALLY well in capitalist, uber-wealthy Singapore (GDP per capita substantially higher than the USA). ~78% of Singaporeans live in housing developed by the Singapore Government’s Housing and Development Board (https://en.wikipedia.org/wiki/Housing_and_Development_Board). It works a bit less well in Hong Kong, but still remarkably well considering how many people are housed in the very small area available.