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The Governance of Land Use in OECD Countries

Policy Analysis and Recommendations

image of The Governance of Land Use in OECD Countries

Land use has important consequences for the environment, public health, economic productivity, inequality and social segregation. Land use policies are often complex and require co-ordination across all levels of government as well as across policy sectors. Not surprisingly, land use decisions can be contentious and conflicts over land use are common across the OECD. This report argues that better land use governance requires the use of a broader set of public policies to influence land use. In particular, the incentives for particular land uses provided by fiscal instruments and tax policies need to be better aligned with land use objectives. The report furthermore analyses land use patterns across the OECD based on comprehensive land cover data. It shows that developed land is growing everywhere, but great variation exists between countries. Lastly, the report summarises insights from six in-depth case studies to show concrete examples of land use related challenges in OECD countries and the response of national, regional and local governments to them.

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Fiscal frameworks, tools, incentives and land use

This chapter explores the connections between fiscal frameworks, tools and incentives and land use. The first section examines how fiscal frameworks – namely reliance by local governments on own source revenues versus state transfers – influence local governments to pursue either expansionary land-use policies, or not. It also explores the connection between how local governments are financed and their incentives to collaborate with one another or to compete. The second section examines the fiscal incentives that impact on the land-use decisions of individuals and businesses. The third section examines how fiscal tools can be used to manage development by highlighting key practices. Finally, the need to better align fiscal incentives with spatial planning objectives is discussed.

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