Abstract
The research discusses land-based financing of sustainable infrastructure with land readjustment as an institutional innovation that might finance local sustainable infrastructure in an inclusive and participatory manner. Land-based financing with value capture describes tools with which land value increments deriving from public action can be used to finance infrastructure and public services at virtually no costs for the public. At times of diminishing tax revenues resulting from the current pandemic in combination with the continuing demographic growth, the expected surge of migration towards cities, and pressure for infrastructure investments to mitigate the effects of climate change local administrations need to prepare for the expected fiscal stress. Multilateral development agencies embrace urbanization as an opportunity to tackle economic, social, and environmental problems in the ambitious global policy agendas, published as the Habitat III - New Urban Agenda (NUA) and the Sustainable Development Goals (SDG’s) with, among other tools, the use of land-based financing. When cities prepare for this future it is not reasonable to expect to manage cities as before. Instead, there is a need to explore innovative, alternative financing tools that tackle local sustainability challenges with local resources and includes the residents in a democratic decision-making process, such as land readjustment. It is not for nothing, that the New Urban Agenda has promoted land readjustment as one of five principles that mark the shift towards a sustainable, equitable and inclusive policy thinking. However, it appears that the institutionalization of land readjustment policies has not been sufficiently understood from a distributional perspective. While land pooling policies are considered to be equitable and inclusive land tools the experience with land pooling policies in practice might contradict the equity notion brought forward by the NUA and the international best-practice literature. We take the contradiction between theory and practice that we find in the Republic of Korea as a point of departure for an institutional analysis of distributional problems deriving from the embeddedness of land pooling policies in a larger context of governmental action. This adds a new level of scrutiny to the discussion of an equitable urbanization with land pooling policies that has not previously been discussed in the academic literature or the NUA. The findings of the research formulate recommendations for the equitable and inclusive implementation of land readjustment that might be valuable for developing communities today.
