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I am a strong proponent of land value taxes, but there are a few things people often get wrong about them. The first is that it does not incentivize development on its own. It does so only indirectly if you assume other taxes such as property taxes will be reduced as a consequence of the introduction of the land value tax. The entire point of the land value tax is to raise taxes without distorting the market, which means it doesn't affect behaviour.
Some people point out that, if your taxes go up significantly, it may force you to sell. But that is just a wealth effect. Any tax that reduces wealth has the same effect, and it would have the opposite effect on whoever benefited from the tax.
The other thing they get wrong is that the supply of land is not actually fixed. Erosion causes land to disappear and it's very expensive to prevent. Land value taxes in coastal areas disincentives protecting land from erosion.
It also discourages exploration, which is not such a problem now. But if we can't credibly commit to not imposing a land value tax in the future on newly colonized planets, we will discourage private space exploration.
Finally, speculation is good and land value taxes discourage it. Speculation improves the allocation of land.
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