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What makes you think market prices are just? This might not be an easy problem to solve, but it's not an impossible one either. ED would be used when people are

by Certhas 10y ago

What makes you think market prices are just? This might not be an easy problem to solve, but it's not an impossible one either. ED would be used when people are unwilling to sell. If you can buy 20 plots of land from people willing to sell for price X and then the two hold outs who are unwilling to sell have to EDed, you know perfectly well what just compensation is. This is a perfect case where leaving it to the market does not generate the most welfare or the most just outcomes. A form of rent seeking behaviour.

shostack 10y ago
Except in a fair market, if a developer managed to get all but a couple holdouts, those remaining would likely be able to command higher prices as they would have leverage. ED robs then of the extra money they could have made, and it can be considerable.
- Spooky23 10y ago
  There's an obvious defect in that approach. The incentive there is to delay the transaction as long as possible. Worst case scenario, the public project fails and you keep your stuff.
  - shostack 10y ago
    If you are someone being forced out by ED, that seems like a pretty positive outcome if you didn't want to move in the first place. Not all public projects are desired by all people, and it is far from a black and white issue.
    - Spooky23 10y ago
      I didn't intend to portray it that way. It's certainly imperfect, especially when it's used for stadiums or other private purposes. But even then -- At least it's an open, public process and not some secretive thing that puts neighbor against neighbor.
baddox 10y ago
I don't mean to make some grand moral claim about markets always being "just." My point is that a buyer who gets to force someone to sell AND gets to choose the price they must sell at is VERY far from my intuitive (yet admittedly ill-defined) feelings about justice. In your example, it seems perfectly reasonable to me that one person may value their land much more than their 20 neighbors value their own lands. Perhaps the one plot of land has been in the family for generations and has immense sentimental value. Perhaps the one landowner doesn't approve of the development project being pursued.

by Certhas 10y ago

shostack 10y ago

Except in a fair market, if a developer managed to get all but a couple holdouts, those remaining would likely be able to command higher prices as they would have leverage. ED robs then of the extra money they could have made, and it can be considerable.

Spooky23 10y ago
There's an obvious defect in that approach. The incentive there is to delay the transaction as long as possible. Worst case scenario, the public project fails and you keep your stuff.
- shostack 10y ago
  If you are someone being forced out by ED, that seems like a pretty positive outcome if you didn't want to move in the first place. Not all public projects are desired by all people, and it is far from a black and white issue.
  - Spooky23 10y ago
    I didn't intend to portray it that way. It's certainly imperfect, especially when it's used for stadiums or other private purposes. But even then -- At least it's an open, public process and not some secretive thing that puts neighbor against neighbor.

baddox 10y ago

I don't mean to make some grand moral claim about markets always being "just." My point is that a buyer who gets to force someone to sell AND gets to choose the price they must sell at is VERY far from my intuitive (yet admittedly ill-defined) feelings about justice. In your example, it seems perfectly reasonable to me that one person may value their land much more than their 20 neighbors value their own lands. Perhaps the one plot of land has been in the family for generations and has immense sentimental value. Perhaps the one landowner doesn't approve of the development project being pursued.