Editing Land value tax (section)

===Classical economists===

Adam Smith, in his 1776 book ''[[The Wealth of Nations]]'', first rigorously analyzed the effects of a land value tax, pointing out how it would not hurt economic activity, and how it would not raise contract rents.

{{Blockquote
|Ground-rents are a still more proper subject of taxation than the rent of houses. A tax upon ground-rents would not raise the rents of houses. It would fall altogether upon the owner of the ground-rent, who acts always as a monopolist, and exacts the greatest rent which can be got for the use of his ground. More or less can be got for it according as the competitors happen to be richer or poorer, or can afford to gratify their fancy for a particular spot of ground at a greater or smaller expense. In every country the greatest number of rich competitors is in the capital, and it is there accordingly that the highest ground-rents are always to be found. As the wealth of those competitors would in no respect be increased by a tax upon ground-rents, they would not probably be disposed to pay more for the use of the ground. Whether the tax was to be advanced by the inhabitant, or by the owner of the ground, would be of little importance. The more the inhabitant was obliged to pay for the tax, the less he would incline to pay for the ground; so that the final payment of the tax would fall altogether upon the owner of the ground-rent.
|Adam Smith
|The Wealth of Nations, [[s:The Wealth of Nations/Book V/Chapter 2|Book V, Chapter 2]], Article I: Taxes upon the Rent of Houses
}}