Miceli, Thomas - Department of Economics, University of Connecticut - 2007
Blume, Rubinfeld, and Shapiro (1984) first showed that compensation for takings can lead to a moral hazard problem that … results in overinvestment in land suitable for public use. To the contrary, this paper shows that the compensation rule is … budgetary terms, causing the distortionary effects of compensation and property taxation to cancel each other out through the …