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The Transition of Land to Urban Use

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  • Richard Arnott
  • Frank D. Lewis

Abstract

This paper investigates the economics of the transition of land from rural to urban use. A simple model examines the developer's problem: when and at what density should vacant land be developed to maximize the present value of land. Simple rules emerge relating the timing and density of new development. The timing rules are similar to those of Shoup; however, unlike Shoup, we express them in terms of market observables. In latter half of the paper, the rules are tested against recent Canadian experience and perform well.

Suggested Citation

  • Richard Arnott & Frank D. Lewis, 1977. "The Transition of Land to Urban Use," Working Paper 267, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:267
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