By Dr Peter Bowman
The market mechanism provides the most efficient way of allocating the resources of an economy. Yet public services, which can count for around half of economic activity, are charged for indirectly through taxes which have no direct connection to what the payer receives in return.
These taxes have many adverse effects on the economy, depressing growth, distorting costs and prices and providing perverse incentives which greatly distort the market and prevent it from operating optimally.
Public services could be paid for through a market mechanism. To achieve this it needs to be recognised that landed property values have two components. The private component relates to the buildings on any particular site but the second, the location value, is a public component since it quantifies all the external benefits the occupier expects to receive from the location.
If these location values were used to replace taxes to fund public services at local and national level it would effectively bring the public sector into the market mechanism. People would pay directly according to the services they received. Removing the burden of taxation from production and trade would bring greater freedom and provide opportunities for genuine wealth creation.
Read more From Land & Liberty Winter 2017
We are delighted to congratulate Fred Harrison on the receipt of his Best Achievement Award. After June’s election result it is clear that many of the UK’s population are no longer supportive of the Conservatives’ austerity measures and are looking for a way to introduce equality and reduce poverty. This book outlines a way this might be achieved.read more
In his first budget the Chancellor of the Exchequer had the opportunity to set a course for Britain’s prosperity post Brexit and to help Mrs May achieve her goal of making Britain a country that works for everyone, while reducing the budget deficit. Instead the measures he proposed caused a storm of protest.read more
New Zealand holds a rather special status in that it was notably the first country to introduce a system of land-value taxation for raising revenue. It was adopted in 1849, some 30 years before Henry George published Progress and Poverty, and finally abandoned in the 1980s.read more
Rent Unmasked has been chosen for the Winter 2016/17 heat of The People’s Book Prize for Non-Fiction. This competition is based purely on public votes – so we need your help. Successful books from the heats are entered into the final, which occurs annually. [voting now closed].read more
“You can become wealthy by creating wealth or by appropriating the wealth created by other people. When the appropriation of the wealth is illegal it is called theft or fraud. When it is legal economists call it rent-seeking”
John Kay, Financial Times 27th Dec 2009
“If a free society cannot help the many who are poor, they cannot save the few who are rich.”
John F Kennedy, Inaugural Speech, Jan 1961
“If science is defined by its ability to forecast the future, the failure of much of the economics profession to see the crisis coming should be a cause for great concern”
“Today we live in a world that is divided. A world in which we have made great progress and advances in science and technology. But it is also a world where millions of children die because they have no access to medicines… It is a world of great promise and hope. It is also a world of despair, disease and hunger”
How Our Economy Really Works
– Why are so many trapped in poverty, when others are grossly well-off?
– Why are house prices continuously rising faster than inflation?
– Why do people so often find themselves in jobs that give them little sense of fulfilment?
– Why is a multi-national coffee shop franchise not actually making its money from coffee?
These questions have confronted the UK economy for decades without resolution by governments of the right or left. It is the failure of economics, the author argues.
ISBN 9780856835292 | Price: £9.95