Cities Should Sell Land to the Highest Bidder

A blog about business and economics.
Feb. 4 2014 1:24 PM

Cities Should Sell Land to the Highest Bidder

One of the last undeveloped parcels in the D.C. central business district is the Franklin School, a historic school building in an area where there's no longer demand for a school. Yesterday, city officials announced they'd accepted a plan to turn the building into a temporary arts exhibit space that will also feature a restaurant by local celebrity chef José Andrés.

David Alpert questions the wisdom of this, as alternate plans (a hotel, an office) would have generated more tax revenue for the city, something that seems particularly egregious in light of the fact that elsewhere the city rejected a community-friendly supermarket plan in a residential neighborhood specifically on the grounds that an alternative plan would do better for tax revenue.

Here is an issue where I think political economy considerations should strongly bias you toward a more right-wing view and say that cities should just sell parcels to the highest bidder and let the private sector sort it out.

Advertisement

In theory, economic development officials could improve on market outcomes by considering a wider array of relevant externalities and so forth. But the real-world outcomes look capricious at best and corrupt at worst. Without objective criteria by which to judge proposals, you get a mess of politicking and an awful lot of costly delays in exchange for not much. There is an interesting question around what officials in an economically depressed city whose land is possibly worthless should do, but a city like D.C. where land is valuable should look to simplify. Sell the land to the highest bidder, and cut a dividend check to residents.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

TODAY IN SLATE

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

Global Marches Demand Action on Climate Change

Politics

Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

  News & Politics
Weigel
Sept. 20 2014 11:13 AM -30-
  Business
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
  Life
Quora
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Tv Club
Sept. 21 2014 1:15 PM The Slate Doctor Who Podcast: Episode 5  A spoiler-filled discussion of "Time Heist."
  Arts
Television
Sept. 21 2014 9:00 PM Attractive People Being Funny While Doing Amusing and Sometimes Romantic Things Don’t dismiss it. Friends was a truly great show.
  Technology
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 21 2014 8:00 AM An Astronaut’s Guided Video Tour of Earth
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.