To what degree is the physical component of land, responsible for today's wealth? After all, much has changed in this regard, in recent centuries.
When land value meant coordination of time value for agricultural capacity, land value was widely dispersed, and also intensively utilized. Once land use began to transition to manufacture and industrial patterns, social coordination and land use gradually became more concentrated as well. As production processes became more efficient, even smaller quantities of land were needed, in relation to total output. Changes in land use mean greater organizational clustering, and the value of spontaneous societal coordination, gradually assumed greater monetary and economic value.
This intensification of land value for coordination processes continues apace, as manufacturing makes way for services based economies in developed and developing nations alike. Today, primary land use value exists in relatively tight clusters, particularly in regions where a high degree of coordination takes place for time value and knowledge based product. Imagine for a moment, clusters of spontaneous coordination as a highly desirable marketplace component (which they are) as "wild salmon". Since the serendipity of spontaneous coordination ("wild salmon") is in short supply, why not supplement it with the "farmed salmon" of organizational design for time and knowledge value?
In other words, generate more of the knowledge "value added" marketplace which populations now seek, via more closely designed organizational patterns. These knowledge use clusters would still be tightly arranged, but different from regional or major city formation since they would be small, broadly dispersed, and capable of utilizing digital potential. Even though some might argue that a "farmed salmon" version of knowledge use isn't economically "healthy", others would be more than happy to have a viable economic option, to today's limited services marketplace. And multiple benefits would accrue, beyond those that directly affect participants in knowledge use systems. After all, corporations have already been coordinating time value for centuries, and there's no reason why a new corporate structure couldn't do the same, within a combined supply/demand and production consumption construct.
Why hasn't a similar process already occurred? Asymmetric compensation has meant a secondary marketplace for knowledge use, and the resulting discrepancies in land use options, increasingly reflect the partial nature of knowledge use in aggregate. Some of the most important forms of knowledge based product have been subjected to extreme forms of location clustering, in spite of the digital promise of wide knowledge use dispersion. Knowledge use wealth capture is an inefficient and incomplete outcome, for the wealth potential of time based product. Indeed, the recent decline in nominal income is one of the major indicators as to what has occurred, even though the problem has not been openly discussed by either policy makers or central bankers.
Land values - over time - can be greatly affected by the degree of economic complexity that not only accrues but remains intact in a given location. However, even though organizational capacity can be nurtured and developed, other more specific aspects of location often lie beyond the ability of individuals to control. Because many aspects of the economy remain in flux, assigning specific attributes for land use beyond that of time value, presently involves more risk.
Consequently, capital intensive infrastructure for specific locations could prove a better follow up strategy for successful knowledge use system formation, than initial development along these lines. Even so, some building and infrastructure components would be flexible enough that they could readily be relocated, should an equilibrium corporation decide to move and start anew. Many environments would respond to group efforts that make them pleasing places to live and work, without requiring the major expenses associated with today's development patterns.
The equilibrium corporation would establish an ownership structure in which actual land use holds a symbolic coordination value, one that would eventually be reflected as rent options for non locals to live and work within these communities if they so desire. This symbolic value would also be a reflection of local incentive patterns, which derive ownership benefits to supplement a time value commodity wage. Even though specific locations would gradually accrue additional monetary value as they mature, initially these communities are built to nurture a time value continuum as the primary component of community formation. Fortunately, should specific locations turn out to be temporary, the time continuum for coordinated activity would readily transfer to new settings.
How to envision ownership in the equilibrium corporation? Time value allows participants to accrue ownership shares which exists in (at least) three dimensions. First, the initial processes of discovering time value in relation to others, provides access to coordinated services activity and the educational structure associated with it. Then, the physical components which include living and working accommodations, in the form of land availability and building use options. The third aspect of this process is more closely related to local business opportunities, especially in terms of investment pools.
Possibly the greatest productivity potential of the present, is taking advantage of spatial land characteristics so as to make greater efficiency possible for combined group action. In spite of the broad coordination gains of an automobile defined environment, these gains came at the expense of aggregate time loss in the form of extended commutes and the need for separately existing time choices. By bringing spatial components into a close framework, groups would not only regain time use options, but also greater flexibility in terms of time use decisions during the course of any given day.
What counts most, is effective coordination for the shared experiences both pragmatic and experiential, that do a better job of organizing scarce time availability. Ultimately, it is the experiences we share with others, that lend the most meaning to daily existence. With a little luck, our economic organizational patterns can do a better job of reflecting this reality. As Paul Romer noted in a recent post, "At the most basic level, an economy grows whenever people take resources and rearrange them in a way that makes them more valuable."