Course:ECON372/OK2019WT2/Topic14
Land Economics
Group #1
https://thetyee.ca/Analysis/2020/03/04/Climate-Catastrophe-Sprawl/
Summary
The article focuses on the suburban sprawl and local government policies and how those are detrimental to BC’s emissions reduction goals. It starts by explaining that in local governments in small cities across BC it is very common to build “non-efficient” single family houses very spread out, this can be a problem for a few reasons but mostly building houses very spread causes a direct increase in transportation pollution. When houses are very spread out it causes a big public transportation problem making it harder to have efficient transportation which in turn causes more people to buy and use more cars. The article discusses the importance of building many dense affordable housing close to services and transportation ending the sprawl. There are however many political problems interfering with the curbing of urban sprawls such as developers lobbying against it and government officials being unwilling to risk losing votes over such projects. The article also suggests a few solutions to tackle the current situation such as asking the BC government to hold the local governments accountable of the climate damage as a result of these sprawls. It also suggests a “green building boom” of affordable housing.
Analysis
Suburban sprawls in BC’s case seems counterintuitive to its emission reduction goals. The suggested solutions could work if the government’s budget allows it. Instead of creating more houses another thing that can be done is breaking older buildings and replacing them with sky scrapers. But this would be a long process and one that wouldn’t ensure less strain on the climate. The best solution could be raising the lands prices to discourage builders from constructing new buildings.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 19 | |
| Course Related Analysis (30-50) | 15 | I don't see much analysis here. The chapter talks about the problem of costly infrastructure with sprawl. The inefficiency. The article mentions this. We have talked often about externalities, and that the externalities from using private vehicles, congestion and pollution, are not being priced. |
| Extended Analysis (0-20) | ||
| Presentation (10) | 8 | |
| Total | 62 |
Group #2
Summary
The article deals with Minnesota’s land use issues in terms of sustainability and how the current taxes in place are making sustainability more difficult to achieve. Burns and Nymoen discuss how the current property tax system taxes both the land and any building on top. They state that this has shown to provide incentives to hold the land without creating more value by building. Therefore, a lot of land in the central business district is being used for low intensity uses. Thus, preventing these areas from becoming a dense, high intensity land usage area which can have detrimental environmental impacts. The article suggests that a way to combat this issue is by introducing a widely adopted land value tax instead.
Analysis
Land value not only depends on the natural resources it holds such as plants, animals, minerals etc but also from the creation of communities and the location this land is in relation to the community density of the region. The main issue seen in this article is how taxes on both the land value and the value of the building is resulting in land being kept at “holding mode”. This is likely to lead to social inefficient land-use as the site will be highly valuable to those with high intensity usage and is therefore not maximising its land rent. This “holding” can trigger the concept of urban sprawl seen in chapter 14. Those looking to buy land may have to acquire it in more suburban areas due to high amounts of underused sites being occupied as well as it likely being cheaper the further from the CBD. Edge centres may be formed as well as the environmental impacts of increased commuting are reason for which this tax is being scrutinised.
The authors suggest the implementation of a land value tax to replace the current tax system. This is taxing a property based purely on the value of the area of land and not the associated buildings. This will mean that there are no longer the same benefits to holding land especially if it is located centrally. It is less likely to discourage people from constructive and beneficial activities. Although those who occupy land downtown may be paying more in tax, but they will also likely benefit more from being in this location than those who are outwit the city depending on the type of land usage, i.e if it was commercial. They are benefiting from least amount of transport needed to reach and availability of employers etc. A higher tax on these areas means there is more reason to increase intensity the closer the land is to the centre which will mean less chances of urban sprawl developing.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 8 | |
| Course Related Analysis (30-50) | 50 | Nice. |
| Extended Analysis (0-20) | ||
| Presentation (10) | 10 | |
| Total | 98 |
Group #3
https://globalnews.ca/news/6556211/jody-wilson-raybould-wetsuweten/
Summary
In an article posted on Global News published by Emerald Bensadoun called ‘ Indigenous land conflicts to persist unless sovereignty addressed, Wilson-Raybould says’ the article refers to the ongoing conflict between pipeline developers and indigenous communities on the current railroad blockades in Canada. Tensions between the government and the Wet’suwet’en have been escalating significantly within the last month. The RCMP claims that they have delayed enforcing the blockades for weeks to tread water on the matter in hopes of a peaceful resolution. Yet, if that weren’t able to be the case RCMP would have no choice but to make arrests. Such protests by the Wet’suwet’en have inspired protests across Canada, making this a federal issue and concern. Jody, Canada’s first Indigenous attorney general states that it is up to the Indigenous peoples to determine what happens on their territory, and not the federal or provincial government. In Jody’s opinion, it is up to the indigenous communities to exercise their rights and decide what happens to their land rather than have other forms of government to decide what happens to their land.
Analysis
This is a classic land issue over ownership of the land where one party thinks they have control over a section of land and another party feels the same way about that section of land. The text states that colliding interests are normal. For example, in the United States, land developers wanted to develop a section of the Grand Canyon and Indigenous communities however did not. In the end, it was up to the communities affected to decide what happens to that section of land. The indigenous community came to the decision that land developers are not to develop the Grand Canyon. Therefore, conflicts like this aren’t uncommon. The best way for both parties to be happy in terms of the pipeline case, they must both come to a decision where everyone benefits from it. Another way the decision could be made is by conducting a CBA and if the benefits out way the costs associated with the project. Then it is almost a no brainer to go ahead with the pipeline. That being said all impacts should be evaluated and quantified over a period of time in order to get an accurate CBA. A major issue currently, is that there has been no communication between the government and the RCMP on how to police the issue as of right now. Therefore the pipeline blockades will continue to be an issue unless the RCMP is aware of such an issue should be enforced. As the textbook mentions, enforcing land remains to be a common issue.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 18 | |
| Course Related Analysis (30-50) | 45 | One interpretation, using course ideas, is that this is a case with unclear property rights, and a battle about who has the property rights. Once the rights are clear, then we can rely on the Coase theorem, in that the parties will negotiate to an efficient solution. Whether that efficient solution involves building the pipeline is not a foregone conclusion. If the WTP for the aboriginal rights holders to keep the pipeline out is high enough, then it is not efficient to build the pipeline. |
| Extended Analysis (0-20) | ||
| Presentation (10) | 9 | |
| Total | 92 |
Group #4
https://globalnews.ca/news/5405141/trans-mountain-expansion-indigenous-opposition/
Summary:
The Global News article “With Trans Mountain expansion greenlit again, Indigenous leaders vow to fight on”, it illustrates the challenges that indigenous community face with the Canadian government. One of the reasons why Indigenous people are against the trans mountain pipeline expansion is because “Our lands are burning and flooding. Our fish are dying and our people are suffering,” Grand Chief Stewart Phillip. Will Gorge, a Tsleil-Waututh member and leader of Protect the Inlet said, “People in British Columbia are the ones risking disaster from spills and we’re prepared to do whatever it takes to stop this pipeline.” On the other hand, the Canadian government seeks a significant amount of benefits through the expansion project. Therefore, Prime Minister Justin Trudeau responded towards the decision about the expansion project and said, “the government doubled the sized of its consultation teams and re-initiated engagement with Indigenous communities,” to show the care towards 65 Indigenous groups across 46 meetings.
Analysis:
The article “With Trans Mountain expansion greenlit again, Indigenous leaders vow to fight on” by the Global News, the main argument discussed in the article is the Indigenous land use. This issue is mentioned in our textbook chapter 14 which is included in the four important contemporary land-use problems: Urban sprawl, Resource preservation, Implications of land-use regulations, and New types of regulations. In this case, the issue is the category of New types of regulations that talks about traditional land-use control regulations. Considering the situation economically, the use of indigoes land to expand the pipeline would create a significant amount of economic benefit not only to the company but also to the Canadian economy as well. For instance, this project is expected to generate $73.5 billion over 20 years, as well as create more job opportunities (approximately 15,000 people are required during the construction, and the expansion will also provide about 37,000 jobs per year during operations (TMC)). Ultimately, considering the cost of this project $9.3 billion, it seems to meet the social efficiency in land use. Thus, only considering the ‘Land Economy’, the trans mountain pipeline expansion project should be processed.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 17 | |
| Course Related Analysis (30-50) | 35 | See notes for the previous article. The numbers presented are not necessarily a true CBA, if the negative impacts on the things that the indigenous people value is not being counted. Further, if they have property rights, then a negotiated solution that involves building the pipeline would only happen if the amount they are paid is larger than the damage they feel caused by allowing the pipeline to go ahead. The social impacts include the impacts on the indigenous people. |
| Extended Analysis (0-20) | ||
| Presentation (10) | 7 | |
| Total | 79 |
Group #5
https://globalnews.ca/news/6641702/alberta-outdoors-stores-park-closure-letter/
Summary:
“Alberta outdoor stores pen letter to government to reverse parks decision” written by Kirby Bourne explains that on March 6, 2020, managers and owners of Alberta outdoor stores attempted to refute, by publishing a public letter, the decision of the Alberta Government closing and partially closing 20 national parks in order to save taxpayers money. Store owners are demanding a reopening as they view that the intrinsic, use, or existence value of the parks is important as they are open for all people, including Indigenous, to use and take care of and that residents should have a right to express how parks should be governed. Additionally, the article states that Alberta companies, such as ski and bike shops, rely on the economic benefits that parks and natural resources produce and the $5 million in savings from a budget of $56 billion is unimpactful and has a higher effect on people’s quality of life, exceeding the importance of potential savings.
The Alberta recreational stores stated that in 2008, individuals participating in outdoor activities contribute $800 million to the Alberta Economy and the letter stated that the government attempting to increase tourism to reduce the reliance on the oil and gas sector is unproductive. Managers also state that they wish for the government to reopen the parks as they believe the government is failing to identify all benefits that parks offer. For example, Doug Dea, general manager of Campers Village in Calgary states that the land will be gone for future generations which is a huge drawback. Additionally, being active and outside is crucial for people’s health and well-being. As parks are still going to be available to use, as stated by the government, there is an uncertainty as to when they will reopen. Outdoor stores believe it is crucial to express their opinions in order to make a change.
Analysis:
As stated in the summary of chapter 14, land is the ultimate resource. It is crucial to the way of life of humans, and how they interact in the economic landscape. With the closures of Alberta provincial parks looming in the near future, this could have a major negative role in the income brought in by the Albertan government. Relating to chapter 14, this article relates mostly to the section of “Managing Public Lands” as these parks are open for everyone to enjoy outdoor recreation and leisure. This portion of the chapter breaks down the processes and decisions that public agencies use to help fulfill the own agencies interests. Since these provincial parks in Alberta fall under the same specifications, we see the same processes happening there. It also goes into detail as to how these public lands can be difficult to manage at times as certain recreational, and industrial activities can coincide with one another.
The article includes a quote which states the closures are “short-sighted”, which in this context is completely understandable. The amount of money generated through the outdoor recreation industry is substantial and the loss of that economic growth for a $5 million tax cut does not seem very well thought out. This scenario raises the questions that are prevalent within the chapter one of which is how to responsibly delegate public land. When the land is privately owned it can be easier in a sense to maintain, and either preserve resources, or build upon the landscape. The Albertan government is trying to create a socially efficient use of their provincial parks, but since it is an open-access resource there are more factors they need to consider.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 20 | |
| Course Related Analysis (30-50) | 40 | A key issue here is the benefits of the parks that are not being counted. The only thing that the government seems to be considering is the revenue generated by the parks, relative to the cost of maintaining and owning the parks. They are acting like a private owner who cannot capture the external values. However, if the government represents the citizens of the province, then it should be considering those external values. Government is not a business, and those choices which maximize the wellbeing of society need not maximize the 'profit' of the government. |
| Extended Analysis (0-20) | ||
| Presentation (10) | 10 | |
| Total | 90 |
Group #6
https://www.cbc.ca/news/canada/british-columbia/south-okanagan-national-park-1.3956491
Summary:
A group of people want to extend South Okanagan national park to get more opportunity, such as, and first nation and environmentalists. However, there is still some ranchers to against it. Canada floated the idea to make national park reserve in 2003, but it gave up the plans in 2012. The main problem that ranchers against is they are going to lose their job and livelihood threatened. Another group of people would like to make South Okanagan land into federal park, which can protect what it calls one of Canada's most endangered ecosystems. Nowadays, this idea has abandoned to create a national park in the South Okanagan-Simikameen, because it respects the position of the Government of British Columbia regarding the creation.
Analysis:
According to the textbook, some of the land subject to strong development pressure has unique ecological value. In this case, for example, environmental groups say the sagebrush desert system in the South Okanagan is home to many of the endangered or threaten species. However, setting up a new national park could affect many private land uses. For example, hunters may not be allowed to hunt anymore in the national park area, ranchers and orchardists might lose their jobs. Policy power from federal and provincial government can advance the processes of setting up the new national park area. As a kind of public land, a new national park can bring social benefit and increase the amount of resource preservation including all other natural resources in this area.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 10 | |
| Course Related Analysis (30-50) | 20 | A central issue here is the distribution of impacts. The value of the biodiversity is a public good, which a lot of people care about a little bit. There are a small number of ranchers/ATVers, etc., relative to the larger public, who would be made worse off by a park. If it goes ahead, how should that happen so that everyone in the end is better off? |
| Extended Analysis (0-20) | ||
| Presentation (10) | 7 | |
| Total | 57 |
Group #7
Summary:
In a March 3rd (2020) article, titled "Alberta to close parks, privatize services in budget cuts" the Globe and Mails Carrie Tait explains that the AB government will partially or fully close 20 provincial parks, and seek out operational partnerships with just over one third of the 473 provincial parks in the to save money in the provincial budget. Of these parks to be closed, many are areas that do not see much use, such as Sulphur Lake park which only received 36 visitors last year. With the declining Alberta economy the provincial government communicated that they are trying to balance what they can and prioritize where the money is going- theoretically to be used to help struggling constituents. Alberta spent $81.6 million on its network of parks this year while only receiving $33.4 million in (direct) revenue and in light of these numbers the province also cut $5 million from the parks budget. Furthermore, recreational activities such as camping fees will increase from $3-10 in some cases. Now as a relief to some, the province will be leasing the parks to 3rd parties not selling them off. With the tough economic situation in Alberta, despite the cuts to the parks budget, Alberta still aims at doubling the provinces tourism value over the next 10 years although these two actions seem contradictory. Tait also dives into the recreational consumer side of this issue stating that the budget cuts will affect trail funding for cross country skiers in Kananaskis park, with concern that without the funding from government for XC grooming the park functions will collapse.
Analysis:
With the article touching on land use, implications of land-use regulations and the management of public lands, it relates directly to our Land Economics chapter. With the provincial government pursuing actions mentioned above on historically public land, the first relatable element that comes to mind is land use efficiency. In terms of keeping the parks under strict public management the marginal net costs are not equal to the marginal net benefit. This is visible with the fiscal costs and revenues of $81.6 million and $33.4 million, respectively. Now the article doesn't mention a monetary amount regarding the social benefit or cost but assuming they calculated it for the locations involved, it did not equal the remaining $48.2 million. Deemed non-efficient, the money the government is saving plus the new income generated from lease agreements will help maximize benefits else were in the province. Next is the scare of turing the parks "private". Since the province is only leasing some parks to 3rd parties not full on selling, the public policies should remain intact such as police power, environmental regulations and taxes, although not stated in directly the article. The tax aspect is interesting, after doing some baseline research, the government will have the tenets pay property tax on top of the lease agreement[1] (assuming the same rules apply in Alberta as they do BC), thus adding some additional revenue. In terms of managing public lands there are pros and cons to the actions taken by the Alberta government, for example take the Kananaskis XC ski community. Budget cuts and lease agreements means the funding for the trails will not be given to them which will increase the cost of doing their activity, however under private management through the land lease, there could be an increase the quality of the park and trials by maintaining them better or adding more recreation area, which could increase the willingness to pay of the consumer depending on the net benefit of the improvement.
Extended Analysis
(Taking these two analysis' separately) Toward the end of the article, it is discussed by interviewees that a potential consequence of the Kananaskis park being underfunded would lead to the over use of the funded parks nearby, mainly the Canmore Nordic Centre (which is already very popular among Calgarians). This overuse of the recreation area would lower the utility given by the activity, as many participants are looking for a remote experience, and lower their willingness to pay for the area its self (park fee) as well as the equipment required to XC ski, the gas to get to the area, which overall would have a negative affect on the XC ski community and surrounding businesses in that area.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 20 | |
| Course Related Analysis (30-50) | 40 | |
| Extended Analysis (0-20) | 10 | |
| Presentation (10) | 10 | |
| Total | 100 |
Group #8
https://www.cbc.ca/news/canada/montreal/montreal-urban-sprawl-1.5412255
Summary:
The CBC News article "Montreal's urban sprawl grows steadily worse, report finds" written by Benjamin Shingler, outlines the intensifying urban sprawl trend in the Montreal area. The Montreal Metropolitan Community (CMM) has a population of around four million people divided into 82 municipalities. This article focuses on the expansion on the city outskirts, stating that since 2015 7,000 people per year move from the CMM to the outlying area. this causes a loss in agricultural land and green space and also increases traffic and the negative externalities from driving further. The trend towards more single-family homes constructed on the rural city edges has increased transportation distances for commuters and since 94% of these commuters primarily use a car to get to work according to 2016 census data, the traffic problem is getting worse. Mayor Valerie Plante argues that this trend cannot continue and plans to address the issue by investing in the public transportation in the CMM area.The CMM executive director, Massimo Lezzoni envisions a denser population in the CMM municipalities so that the public transport investments can be more effective and the number of automobiles on the road can be significantly reduced. This proposed plan attempts to control and reduce the intensifying urban sprawl in the greater Montreal area.
Analysis:
When studying land economics one of the the important land-use issues that arises is a concept known as urban sprawl. Urban sprawl occurs when the rural fringe is extended deeper into the agricultural area and further away from the central business district of the city. The suburbs play a large role in increasing urban sprawl. For the case of Montreal, we can apply a rent gradient for the land value when used for agriculture or development as the land becomes further away from the downtown core. Using this simplified model for the CMM, the land closest to the central business district is more valuable for housing and the development rents decease as the land becomes further away. The agricultural and green space rent curves behave in a similar manner but decline at a slower rate and economic rent in the central business district is less than for development. We find the urban fringe where the gradients intersect and the economic rents from development or green spaces/agriculture are equal. In the opinion of Mayor Valerie Plante, the urban fringe has been pushed too far from Montreal's metropolitan area.
One reason that the socially efficient urban fringe may by closer to the city center than the private market equilibrium, is that road access in the Montreal area is free. This makes the marginal private costs of driving an extra mile lower than the public social costs due to road maintenance and pollution costs. This can incentivize urban sprawl. In the article the CMM's executive director plans to mitigate these externalities by increasing the municipalities' population densities and increase the public transportation use in the CMM. He could use zoning regulations to increase the population density and reduce urban sprawl. To increase the density of development, decreasing the minimum lot size or even implementing a maximum lot size may be effective. Tax incentives to live closer to the city center could be another strategy to discourage Montreal inhabitants from moving to the suburbs in the outlying areas. Creating agricultural land reserves around the outskirts of the city is another way Montreal could reduce urban sprawl. The equation to find the total fringe area is: Total acres developed = Number of new homes X Acres used per new home. The proposed zoning regulations would decrease the "acres used per new home" factor, and the tax incentives and agricultural land reserves would reduce the "number of new homes" on the outskirts factor. all of these methods would cause a reduction in the "total acres developed" in the fringe area. The proposed massive investments in public transportation would be most effective at reducing traffic and air pollution if Montreal first uses these land economic methods to reduce the urban sprawl and increase the population density in the CMM.
| Category | Mark | Comments |
|---|---|---|
| Article Source (10) | 10 | |
| Article Relevance (10) | 10 | |
| Summary (20) | 18 | |
| Course Related Analysis (30-50) | 50 | |
| Extended Analysis (0-20) | ||
| Presentation (10) | 10 | |
| Total | 100 |
- ↑ BC gov. "Property tax".