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Takings, Compensation, and Equal Treatment for Owners of Developed and Undeveloped Property

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  • Innes, Robert

Abstract

This article constructs an economic model of government takings in which some property owners develop their land earlier than others. Because it is efficient for the government to "take" undeveloped land before developed land, uncompensated takings will give landowners an incentive to develop their property early in order to reduce the risk of government appropriation. This overdevelopment incentive can be countered, and efficiency thereby restored, if landowners are appropriately compensated when their property is taken, or if "equal treatment" is afforded to owners of developed and undeveloped land. However, when the government responds to political pressure, a judicial compensation requirement will often lead to less government land use regulation than is efficient. In contrast, a judicial equal treatment requirement can elicit efficient development and regulatory decisions. Copyright 1997 by the University of Chicago.

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  • Innes, Robert, 1997. "Takings, Compensation, and Equal Treatment for Owners of Developed and Undeveloped Property," Journal of Law and Economics, University of Chicago Press, vol. 40(2), pages 403-432, October.
    • Handle: RePEc:ucp:jlawec:v:40:y:1997:i:2:p:403-32
    DOI: 10.1086/467378
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    References listed on IDEAS

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    1. Hermalin, Benjamin E, 1995. "An Economic Analysis of Takings," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(1), pages 64-86, April.
    2. Miceli, Thomas J & Segerson, Kathleen, 1994. "Regulatory Takings: When Should Compensation Be Paid?," The Journal of Legal Studies, University of Chicago Press, vol. 23(2), pages 749-776, June.
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    6. Baxter, William F & Altree, Lillian R, 1972. "Legal Aspects of Airport Noise," Journal of Law and Economics, University of Chicago Press, vol. 15(1), pages 1-113, April.
    7. Riddiough, Timothy J., 1997. "The Economic Consequences of Regulatory Taking Risk on Land Value and Development Activity," Journal of Urban Economics, Elsevier, vol. 41(1), pages 56-77, January.
    8. Farber, Daniel A., 1992. "Economic analysis and just compensation," International Review of Law and Economics, Elsevier, vol. 12(2), pages 125-138, June.
    9. Lawrence Blume & Daniel L. Rubinfeld & Perry Shapiro, 1984. "The Taking of Land: When Should Compensation Be Paid?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 99(1), pages 71-92.
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