Edward Glaeser: evaluation

Transcript context

…What is your opinion on Georgism? Do cities need a land value tax? Would it be better if all the other taxes are replaced by one? Okay. So Henry George, I don’t know any economist who doesn’t think that a land value tax is an attractive idea. The basic idea is we’re going to tax land rather than taxing real estate values. And you would probably implement this in practice by evaluating the real estate and then subtracting the cost of construction, (at least for anything that was built up, meaning you’d form some value of the structures and you just subtract it). The attractive thing from most of our perspectives is it doesn’t create the same disincentive to build that a real estate tax does. Real estate tax says, “Oh, you know what? I might want to keep this thing as a parking lot for a couple of years so I don’t have to pay taxes on it.” If it were a land value tax, you’re going to pay the same tax, whether or not it’s a parking lot or whether or not you’re going to put a high rise on it, so you might as well put the high rise on it and we could use the space. So I think by and large, that’s a perfectly sensible idea. I’d like to see more places using land value taxes or using land value taxes in exchange for property taxes. Where George got it wrong is the idea that a land value tax is going to solve all the problems of society or all the problems of cities. That is ludicrously not true. One could make an argument that in those places that just have a property tax, you could replace it with a land value tax with little loss, but at the national level, it’s not a particularly progressive tax in lots of ways. It would be hard to figure out how to fund all the things you want to fund, especially since there are lots of things that we do that are not very land intensive. I think George was imagining a world in which pretty much all value-creating enterprises had a lot of land engaged. So it’s a good idea, yes. A panacea, no. No, that’s a good point. I mean, Google’s offices in San Francisco are probably generating more value than you would surmise just from the quantity of land they have there. Do American cities need more great builders like Robert Moses?…

Stored transcript either side of the excerpt. The highlighted words are the published quote; the surrounding text is unedited source, never generated.