Grasping the landed municipality

What importance does public landownership hold for the production of our urban futures? This is one of the questions asked in my recently defended thesis project: The Landed Municipality: The Underlying Rationales for Swedish Public Landownership and their Implications for Policy. To answer the question, one must first form an understanding of the different roles that land can play in development, depending on what landownership means for the owner of said land. This short article, which builds on the findings of my thesis work, will discuss the power that landownership can provide local public bodies and how this, in turn, affects our local physical environment.

Around the 1980s, questions of land and its role in housing production were a hot topic in academia. However, the questions then seemingly disappeared from the debate for three decades, only to return with full force in the aftermath of the 2008 financial crisis. The renaissance of private land research also increased the interest in public land, and Haila (2016), Christophers (2016; 2018), Eidelman (2016), and Whiteside (2017), among others, have actively worked to bring public land back into the center of discussion. What many of the authors on land and land management have come to conclude is that the emerging tendencies of neoliberalism seen in the 1980s have now evolved into normality, often supported by a legislative framework to ensure their hegemony. However important these studies have been to understand the recent transformation in the management of public land assets, none of them have aimed to understand the presupposed purpose that these land assets have to their public owners. Instead, the landowners have often been treated as rent-seeking actors who, in the midst of a changing political climate, do what is possible to increase their rate of return.

I would instead like to argue for the importance of understanding the meaning of landownership. Not only because it broadens the knowledge of how landowners act on the land market, but because the perceived purpose of land will affect its management, and thus in the end how that land is used and developed. As argued by Linklater (2013), the choices made about land use will ultimately decide what type of society we build.

One important key to understanding the different meanings of land can be found in the early writings of Doreen Massey, in her collaboration with Alejandrina Catalano. Their work, which was published in the book Capital and Land: Landownership by Capital in Great Britain (1978), disaggregates the British landowning class into three separate rationales of landownership, each representing a different relation to land, and in turn, a distinct relation to rent.

When researching British private landowners, Massey and Catalano surprisingly realized that many acres of land were still owned by the nobility who had continued to hold on to the land in spite of it losing its economic value for them. Massey and Catalano named them former landed property owners, concluding that these landowners who had in previous periods lived well off of the rent yields from their assets now had tied their identity to the land that they owned so tightly that they would rather hold on to the land than sell it, even if putting the land up for market would be the economically sound decision. Another category of landowners Massey and Catalano identified were the industrial landowners, who had bought land to avoid paying rent to other landowners as they focused on their main activity, which was to profit off of industrial outputs. These landowners had no sentimental relations to the land and were thus more profit driven in its management. They were, however, still bound to the land through the industrial buildings necessary for their main objective, which meant that their land management was a spillover from their business strategies. The third and final group of landowners was, according to Massey (1980), the most prominent one in a capitalist society: financial landowners. For the owners of land in this category, land was just another sector to invest in, and therefore the land that they owned was treated like any other economic asset. Land for these actors could be a source of rent, an investment opportunity, or collateral for credit.

The value that comes from using this more nuanced perspective on the landowner is that it provides a better prediction and understanding of how landowners react to market fluctuations and global trends. As argued by Kerr (1996), the common tendency to treat all landowners as a homogenous class means a lesser tool for land-based analysis. Surprisingly, however, is that when Massey later went on to argue that these relations were mirrored in the way in which public actors treated their land assets (1980), none followed up on the implications of her conclusions. Instead, Massey went on to work on other subjects, and this particular piece of work disappeared into oblivion.^[1]

In my thesis project, I have used the rationales of private landowners to create an instrument through which to understand Swedish public landownership in both its historical and contemporary forms. By working closely with the Swedish case, I could adapt these modalities to different forms of public landownership.

At the beginning of the 20th century, Swedish urbanization and privatization of land contributed to land speculation and unsanitary urban housing conditions, which prompted a political debate on the unearned value increment of land and public responsibility.^[2] In response, municipalities bought land to control both the value increment and to improve the built environment. An active politics of land became a cornerstone for the construction of the Swedish welfare state (Zetterlund, 2022). During this early period, a version of landownership categorized by a long-term understanding of the value of public landownership was developed. Land became seen and treated as a public responsibility, which was reflected in the judicial discussions and political proposals at the time. One of the overarching goals of land-related politics was to create a system to ensure citizens a share of the increasing land values, either through land taxation or through public ownership of land. I call this form of public landownership moral landownership because of its focus on public long-term responsibility towards its citizens.

After the Second World War, it became clear that the construction of housing was too slow in pace to fulfill the duties of the welfare state. Consequently, the state needed to secure control over the development of housing to increase the speed and quality of construction. During this period, public landownership became a necessary tool to increase production speed and to seize control over the land value development, with the aim of keeping it stable to decrease speculation in land. The focus on housing construction is why this approach to public landownership was named productive landownership. At the end of this period, with the famous Million Programme finished in 1974,^[3] Sweden for the first time ever had an oversupply of housing.

Thus, by the end of the 1970s, the tool of public landownership had transformed from being the sole possibility a municipality had to ensure control over the built environment to being one tool among many through the development of more intricate planning regulations. However, the top-down planning regulations also came with controversies, and at the end of the 1980s, new discussions on public participation, decentralization, and the retraction of state influence became prominent, leading up to a new planning legislation in 1987 and a shift towards another type of public landownership: the investment landownership. The investment landownership attitude to public land regards public land assets as assets to be realized. It is short-sighted in its approach and seeks to solve the issue at hand in the near future, either by using the land assets as collateral for debt, or by improving the municipal budget through land sales. The key to good land use planning, according to this form of public landownership, is to ensure that citizens get a good return on their public assets, and thus the land is often sold at the highest possible price.

The historical transitions between these periods are complex and muddy, but in my thesis I argue that the paradigm shifts arrive when a landownership rationale is no longer able to deliver on its promises. The shift from moral landownership to productive began when the idealistic long-term goals of the moral rationale started to clash with the growing unrest of an anticipated working class who did not care to wait any longer than necessary for improved living conditions. A generation later, the shift from productive to investment rationale came as a consequence of a regulative, top-down planning regime who might have been too enthusiastic about bureaucratic power. When regulation reaches its peak, there is nowhere to go but to deregulate.

Since the 1990s, the state in Sweden has taken a step back from the financing and control of housing production. Instead, the responsibility of ensuring new housing has been left to the municipalities to handle. This has created the interesting feature of Sweden having in essence 290 municipalities, with 290 different planning strategies. In my research on contemporary municipal land politics, I looked closely at three of these municipalities working actively with land. By using the public landownership categories as a lens through which to interpret their contemporary land use, it shed light on the fact that the rationales that shaped municipal politics of land were different and created different outcomes than what was deductible by only looking at the dominated rationale on the national level.

From interviews with local politicians, it became clear that public landownership, although every respondent considered it important for planning, had different meanings to them and, consequently, the local politicians held different views on the municipal responsibility of keeping a public land bank. One example that I discuss further in the thesis is the different interpretations these municipalities had on the term “market price” and how that affected their pricing mechanisms. According to EU State Aid regulations and Swedish municipal legislation, public land must be sold at market price (EUR-Lex, 2008; SFS 2017:725). Nevertheless, the municipalities participating in the study held very distinct views on how market price should be assessed, addressed, and even manipulated.

Not surprisingly, a municipality guided by the investment rationale was much more inclined to use the land as collateral for debt to avoid tax increases, thus effectively pushing issues into the future. To these actors, the land needed to have its values realized to hold value, and they often attempted to maximize its price tag with the direct incentive to improve municipal finances. Contrastingly, one municipality with the productive approach was instead prepared to go to great lengths and include innovative takes to ensure that the pace of housing construction continued as intended. By actively evaluating every new project, they constantly improved their land allocation strategies to achieve their goals, and when they saw that they needed to improve their public land bank to uphold construction they took a public loan to see it done. Lastly, for the municipality guided by the moral landownership rationale, their goals were so long-term that they had no issue with purchasing land today that would not be developed until 40 years ahead in the future. Furthermore, the municipality had long been so active on the land market that they effectively controlled land market prices by selling their land at a fixed price and strategically saturating the market with new land when needed, if they saw the market value increase. For them, public landownership was seen as such an important and natural part of the municipal responsibility that they did not have any political conflicts about this particular part of municipal politics.

Through the interviews with local politicians, it became clear that the landownership rationales active in the respective municipalities were not as dependent on the political majorities of each place as one might initially think. Instead, the land politics were characterized by broad coalitions, perhaps reflecting the necessity of long-term agreement when it comes to planning and housing, as each project will, unavoidably, span political shifts. What becomes interesting here is not the municipalities acting within the investment rationale, as it only follows the dominant rationale on the national level. Instead, what we should look at further is the municipalities who, based on broad political agreements, chose to set out a different path for themselves and the future of their physical development.

Their ability to do so is, of course, dependent on several framing factors such as access to land, previous political regimes, their voter base, etc.  Nevertheless, this clearly demonstrates that local authorities do have an important choice in the matter of land politics and urban development, instead of being swept away by the current. This article set out with a question: what importance does public landownership hold for the production of our urban futures? The crude answer is that in itself, public land holds zero importance because it is not the land and its ownership in itself that matter, but what that ownership means, as it is only this that will determine how the land is finally used and developed, and for whom.

---

^[1] Except as a reference to historic British landowning patterns.

^[2] The discussion on unearned land value increment traces back hundreds of years and will not be done justice here. For more on this see e.g, Gunnison Brown (1943), Backhous (1997) or Ryan-Collins et al. (2017).

^[3] During the years 1965-1974 a system of state subsidies and aggressive programme of housing construction led to one million homes built in under 10 years.

References