Landowner Characteristics: A Basis for Locational Decisions in the Urban Fringe

Barnard, Charles H.; Butcher, Walter R.

doi:10.2307/1242023

Cited by 12 publications

(5 citation statements)

References 11 publications

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“…A third point to be discussed is the potential existence of information asymmetries between sellers and buyers (Dunford et al, 1985;Barnard and Butcher, 1989). Land prices may not truly reflect the value of the various attributes if the assumption of full information does not hold.…”

Section: Limits To the Use Of The Informational Content Of Land Pricementioning

confidence: 99%

The Informational Content of Land Price and its Relevance for Environmental Issues

Latruffe

2017

IRERE

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As the support of human and natural activities, land is a resource of major interest both for environmental and socioeconomic issues. Research aimed at improving land management and conservation has long recognized the need to integrate both issues, but a consensual and consistent framework is still lacking. We argue that land price could be one of the possible links here, as a consistent proxy for some of the multiple dimensions of values that people put on land resources. We present the elementary economic theory about land price, namely the present value model, and we review the abundant empirical literature using this classical theory to study the informational content of land price. We then propose a typology of this literature, highlighting its strengths and weaknesses, in order to guide future environmental research which aim at drawing out some socioeconomically oriented policy recommendations.

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Section: Limits To the Use Of The Informational Content Of Land Pricementioning

confidence: 99%

The Informational Content of Land Price and its Relevance for Environmental Issues

Latruffe

2017

IRERE

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“…Additional infrastructures expose developers to greater financial risks. In the high-risk business of subdivision development, developers have been known to limit risks by avoiding upfront costs (Barnard and Butcher, 1989;Dowall, 1984;Goldberg and Ulinder, 1976;Hepner, 1983). Using private sanitary systems and roads with lower standards avoids additional capital expenditures, even if this may mean foregoing potential profits.…”

Section: Developers Avoid Additional Upfront Costs As a Risk Managemementioning

confidence: 99%

“…There is a number of reasons why small developers might satisfice (Mohamed, 2006a). Among these are aversion to regulatory risks (Lucy and Phillips, 2000;Wiewel et al, 1999), the setting of profit targets (Baerwald, 1981;Kenney, 1972;Leung, 1987), aversion to risks that result from large upfront investments (Barnard and Butcher, 1989;Goldberg and Ulinder, 1976;Hepner, 1983), and preexisting heuristics and preferences for the status quo (Kenney, 1972;Peiser, 1990).…”

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confidence: 99%

Why do residential developers prefer large exurban lots? Infrastructure costs and exurban development

Mohamed

2009

Environ. Plann. B

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Infrastructure costs, lot size, and developers' response: the need for an assessment Planners continue to be concerned about large-lot residential development in exurbia (Nelson and Sanchez, 2005). (1) A substantial literature has attempted to explain why this form of development persists [see Byun and Esparza (2005), for a recent synthesis].Missing in the discussions, however, is in-depth research on how on-site costs for infrastructures may influence the decisions of single-family residential land developers (hereafter called developers) to produce large-lot exurban development rather than small-lot development. The omission is surprising, given that developers are integral to the development process (Peiser, 1990) and that their responses to regulations have been seen as contributing to sprawl (Byun and Esparza, 2005;Dowall, 1984;Frieden, 1979). The oversight has resulted in a lack of knowledge about how developers view developmentöin particular, why relatively large-lot exurban development remains popular with developers despite policies that attempt to steer them elsewhere.The objective of this paper is to further our understanding about why developers might be attracted to large lots in exurbia. I do so by examining how developers' on-site costs per lot for the basic infrastructures of sewer and water services and roads vary with lot size, and in turn, how these costs can affect the lot sizes that developers choose. It is not the intention of this paper to address the many other factors that influence the choice of lot sizes historically observed in land development.I utilize on-site costs as the basis for analyses because this measure highlights a conundrum in the literature which, if resolved, can help us to understand why developers choose larger over smaller lots. The conundrum lies in contradictory findings in the literature on the costs of sprawl, which has concluded that on-site costs per lot increase as lot sizes increase [see Najafi et al (2007) and Speir and Stephenson (2002) for the latest findings in this regard], and the literature on developer decision making,

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“…As this brief review of the theoretical literature shows, many models of land development over time and under uncertainty have utilized the notion of a reservation value. In addition, the work of Barnard and Butcher (1989), Tavernier and Li (1995), and Tavernier et al (1996) tells us that even the empirical literature on land development has made use of the concept of a reservation value. A perusal of these theoretical and empirical papers tells us that the magnitude of a landowner's reservation value has a significant impact on the decision to develop or preserve land.…”

Section: Introductionmentioning

confidence: 99%

Endogenizing the Reservation Value in Models of Land Development Over Time and Under Uncertainty

Batabyal

Biswas

2004

SSRN Journal

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The notion of a reservation value is a key feature of most contemporary dynamic and stochastic models of land development. It is clear that the magnitude of the reservation value has a fundamental bearing on the decision to develop or preserve land. This notwithstanding, many papers that analyze land development in a dynamic and stochastic setting treat a landowner's reservation value as an exogenous variable. Therefore, the purpose of this paper is to endogenize the reservation value in the context of a model of land development over time and under uncertainty. Our analysis shows that the optimal reservation value is the solution to a specific maximization problem. In addition, we also show that there exist theoretical circumstances in which the optimal reservation value is unique.

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Landowner Characteristics: A Basis for Locational Decisions in the Urban Fringe

Cited by 12 publications

References 11 publications

The Informational Content of Land Price and its Relevance for Environmental Issues

The Informational Content of Land Price and its Relevance for Environmental Issues

Why do residential developers prefer large exurban lots? Infrastructure costs and exurban development

Endogenizing the Reservation Value in Models of Land Development Over Time and Under Uncertainty

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