Postdoctoral researcher Hyötyläinen Mika

The promise and discontent of fiscal land rent – Comparing and contrasting land value capture policies in Copenhagen, Helsinki and Stockholm

Tieteellinen tutkimus / siihen pohjautuva työ | Nelivuotinen

Cities are under increasing pressure to promote sustainable, socially equitable and resilient development. This puts also new fiscal demands on urban authorities. Increasing taxation is often unfavorable for the electorate and businesses. So what alternative ways do cities have to finance sustainability targets while maintaining taxpayer satisfaction and a competitive edge? Nordic cities have a rich history with one fiscal strategy that would fit the bill, called land value capture (LVC). LVC means that the value of land, formed by the collective efforts of the public, is collected by various means and then used for the public good. The key rationales behind LVC have traditionally been to deter land speculation, collect moderate revenue and ensure sustainability in urban development. Urban scholars and policymakers tend to advocate LVC policies. However, what has been largely neglected are the notable changes in LVC policies and a novel revenue maximizing approach to land use in Nordic cities. Cities appear to be seeking to inflate land values by inviting global finance capital and ever larger urban development projects to maximize rent revenue. Such development-boosting land policy is in great contradiction with sustainability goals and poses risks of growing segregation and gentrification. This project compares and contrasts the traditional and contemporary means, goals, justifications and consequences of LVC policies in three Nordic cities – Copenhagen, Helsinki and Stockholm. The project theorizes these changes with the conceptual arsenal around urban land rent, particularly fiscal land rent, developed by the late Finnish urban scholar Anne Haila (1953-2019). The project addresses a gap in research to analyse LVC in the context of rentier capitalism. Analyzing policy documents and interviews with land policy and city authorities the objective of this project is to better understand the promises and discontents of LVC in Nordic cities.