Research team
A tax biting its own tail? Assessing the spatial and economic consequences of development charges
Abstract
Local governments face high infrastructure investment needs but operate under persistent fiscal constraints, sparking interest in alternative funding methods that can meet their capital needs. One instrument gaining particular traction is the development charge (DC), a contribution required from new real estate projects to finance the infrastructure their projects necessitates. Yet, despite the growing reliance on DCs, limited evidence exists on their effects. Uncertainty persists regarding their influence on housing prices and spatial distribution of development. This motivates a central research question: how do development charges affect development patterns and housing affordability? To answer this question, the project exploits a rare natural experiment created by the 2023 Instruments Decree in Flanders, which obliges all 285 municipalities to replace informal, negotiated DC practices with formal ordinances under a unified legal framework. While the reform standardizes the institutional context, municipalities retain discretion over the structure of their charges, generating meaningful cross-municipal variation. A differences-in-differences design is used to compare effects of DCs before and after the reform across jurisdictions adopting distinct configurations. Through this rare analytic leverage, the project offers one of the first systematic assessments of DCs in practice, supplying new evidence to inform infrastructure finance and urban planning debates.Researcher(s)
- Promoter: Coppens Tom
- Co-promoter: Damen Sven
- Fellow: den Heijer Chris
Research team(s)
Funding
- FWO
Project type(s)
- Research Project
Capturing the unearned increment: urban planning, land value capture and financialization
Abstract
Infrastructural regeneration is key in today's cities, but taking action is often hampered by the scarcity of public resources on which it typically depends. Recently, policy and scholarship have put faith in land value capture (LVC) instruments to overcome this 'infrastructure gap'. Through such instruments, funds are acquired by recouping the increases in land values resulting from public actions. Though expected to bear fruit, LVC carries the risk of deepening the broadly studied adversities stemming from the 'financialization' of the city. In this research, I intend to bridge the gap between financialization and LVC literature by scrutinizing and comparing how LVC instruments affect planning processes and spatial outcomes in four international cases. Based on an institutionalist approach, I employ the Institutional Analysis and Development (IAD) framework to understand for each case how the governance networks surrounding LVC instruments operate, and how financialization plays a part. In-depth interviews and document analysis will provide the data for the analysis. Afterwards, I compare the findings through qualitative comparative analysis. This research will result in a) a categorisation of key benefits and pitfalls following LVC practices and b) insights into how financialization occurs in LVC practice.Researcher(s)
- Promoter: Coppens Tom
- Co-promoter: Van Dooren Wouter
- Fellow: den Heijer Chris
Research team(s)
Funding
- FWO
- FWO
Project type(s)
- Research Project