Research

Urban expansion drives biodiversity loss and increases travel costs without effectively boosting housing production, necessitating land use policies that limit development. Simultaneously, land-related tax revenues constitute a significant portion of municipal budgets, creating potential incentives for local authorities to develop land precisely when land value increases: a taxing dilemma between preserving soils and raising municipal revenues. Using a panel database of France's main land-related taxes and exploiting quasi-experimental variation in toxic loan exposure, we analyse how financial constraints affect land take. Results reveal nuanced responses: only municipalities severely affected by the debt shock exhibit an increase in land take. This effect primarily reflects commercial rather than residential development, accompanied by reduced densification. Municipalities strategically adjust fiscal policy by moderately increasing property taxes (their highest revenue-generating instrument). Responses vary by context: urban municipalities rely more on tax adjustments, while rural areas show greater land use flexibility. Under fiscal competition where policy options are constrained, land take increases substantially, highlighting environmental risks. These findings challenge the presumed tradeoff between local fiscal revenues and land conservation, suggesting that financial constraints typically promote restrained land use except under severe fiscal stress with limited alternatives. This demonstrates the necessity of considering tax system complexity regarding both incentives and environmental impact when designing policy.

As cities grow, building in already populated areas becomes central to housing affordability and land preservation. Competition over land use generates conflicts between economic actors and with local governments. We build a unique database spanning decades of construction and land-use litigation in France, using a LLM to extract rich contextual information from over 230,000 administrative court decisions. Linking these cases to granular administrative zones, we find two main patterns. Anti-construction litigation accounts for most of the cases and constitutes a strong force against densification of dynamic areas, constraining housing supply in particular. On the other hand, Pro-construction litigation largely aimed at securing building rights, creates development pressure at the urban fringe. Despite legal reforms intended to reduce litigation and low probabilities of winning in court, the number of cases has progressed. This can be rationalized by standard economic theory of litigation relying on individuals seeking to protect their asset value. We further document costly consequences for local governments as litigation threatens local land-use regulation. Our paper illustrates the difficulty to solve the trade-off between sprawl and housing supply via regulation and suggests large implementation costs associated with the rollout of stricter land preservation policies.

In France, land take disproportionately affects agricultural land, with land prices surging up to 65 times upon reclassification as buildable. This process not only threatens biodiversity but also exacerbates socio-economic inequalities, as wealth disparities increasingly limit access to homeownership, especially for younger generations. This research project investigates the relationship between land tenure inequalities and artificialization, focusing on the distribution of ownership and the beneficiaries of associated land rents. By constructing a comprehensive national database of real estate property, including socio-economic characteristics of owners, we analyze ownership concentration before and after land take.