The distortion of the land market due to plans for the infra-structure of the region: criteria for alternative valuation

Abstract

The alterations caused by the realization of large scale, linear infra-structure have repercussions that similarly disrupt the land market. The market is still not perfect and has all the inherent problems connected to estimation of the compensation due for expropriation. In general, the latter doesn’t compensate the expropriated party sufficiently for the impact that the construction of a new infra-structure can have on the land in question. The result is that the expropriated party not only loses possession of their own estate, but also receives nothing in recognition of its plus/minus value compared to the non-expropriated party. The effect on the land market created by the expropriation procedure itself is not factored into the estimated compensation. Another question is the standardization of the method used to determine  the additional compensation due, calculated by means of the Vam, which does not make provisions for the instance of a farming company headed by an entrepreneur with above-average business skill, nor does it consider  the agricultural and  pedoclimatic quality. Lastly, the drafting of a new system for calculating compensation for expropriation is deemed as necessary, one that would incorporate the quid of the land productivity factor within the business initiative “infra-structure for public use”.