February 01, 2006
The economics of eminent domain
The concept of eminent domain has been in the news recently after a controversial Supreme Court ruling. N.C. State University's Mike Walden looks at the concept and the economic issues surrounding it.
"It’s a concept really defined by the U.S. Constitution," says Dr. Walden, a professor and extension specialist with the College of Agriculture and Life Sciences' Department of Agricultural and Resource Economics.
"It says that private property can be taken by the government as long as it’s for public use and as long as just compensation is provided.
"For example, property may be taken for things like roads, interstate highways," he adds. "Clearly the idea here is that the greater public use exceeds the private use.
"Now there are two issues here," he adds. "One is, What is a public use? On the one hand you may say roads are, but what about commercial development, which actually was the subject of the Supreme Court ruling? So that’s a question.
"The second question is, How do you define and calculate just compensation?"
Posted by deeshore at February 1, 2006 08:00 AM