Cities and the Urban Land Premium

Cities and the Urban Land Premium

Henri L.F. de Groot, Gerard Marlet, Coen Teulings and Wouter Vermeulen

After a long period of suburbanisation, cities have been in vogue again since the 1980s. But why are people prepared to spend far more money on a small house in the city than on a large house in the countryside – and why doesn't this apply to all cities? This book shows that the appeal of the city in the 21st century is not only determined by the production side of the economy, but also by the consumption side: its array of shops, cultural activities and, for example, an historic city centre. All these factors not only translate into land prices that are worlds apart but, in terms of production, into different wages for urban and rural citizens. This book maps out these differences.

Chapter 8: Social cost–benefit analysis of an inner-city transformation project

Henri L.F. de Groot, Gerard Marlet, Coen Teulings and Wouter Vermeulen

Subjects: economics and finance, urban economics, urban and regional studies, cities, urban economics


An SCBA is a valuable measurement tool, but not appropriate for urbanisation processes or metropolitan developments. Adri Duivesteijn, 2009. The instrument of the social cost–benefit analysis (SCBA) has been widely accepted in the assessment of investments in infrastructure, but it has led to fierce discussions in recent applications in the domain of land development. Former minister Jacqueline Cramer, for instance, stated in a parliament debate about the spending of the budget for the National Spatial Strategy that this instrument is not always equipped for the ‘complexity and integrality and the long term orientation’ that is required in the decision making for these kinds of projects. Adri Duivesteijn, former alderman for spatial planning in Almere, even classified the SCBA as a measurement tool unfit for urbanisation processes or metropolitan developments. The recently published ‘Guideline for SCBAs of integral area development’ (Werkwijzer MKBA van integrale gebiedsontwikkeling) blamed the criticism partly on the differences in ways of thinking between economists and planners, and partly on the specific characteristics of integral land development.

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