political economy and land valuation methods

Land is a key factor for urban planning and is a basic input for any housing and construction policy in public spaces. This requires the utmost rigor in the scientific perception, instruments and methods that are appropriate for determining the price of urban land. Before presenting and discussing these aspects, this article examines the arguments of classical and neoclassical economic theory that explain the principles of studying valuations as part of a theoretical conception of economical sciences. This review stresses poorly understood notions, such as this: the price of land is not established in the production process and it is not produced like any other commodity, since its existence comes from processes of higher productivity and resource ownership that makes a difference in productivity in a market where the worst production conditions regulate prices; in short, it is the market and not land ownership what defines land prices, consistent with the valuation of utility in the production process of built environments.