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3. Economic Returns to Land Resources: Theories of Land Rent Nindyantoro.

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Presentasi berjudul: "3. Economic Returns to Land Resources: Theories of Land Rent Nindyantoro."— Transcript presentasi:

1 3. Economic Returns to Land Resources: Theories of Land Rent Nindyantoro

2 3.1. Basic Concepts of Land Rent (1) (a) What is land rent?  Price paid for the service of a unit of land (b) Land rent is return to land (c) Return to land is residual payment to land

3 3.2. Basic Concept of Land Rent (2) (d) Essentially, land rent is economic surplus obtained from operating a unit of land (e) Rent can be measured either as average value or marginal value. (f) Land rent affected by many factors

4 3.3. Classical Theories of Land Rent (1) (a) Two Competing Theories  Ricardo  Von Thunen (b) Ricardo’s Theory of Land Rent  Based on differential quality of land  Higher fertility of land  higher rent for the land  Illustration

5 Teori Land Rent Ricardo  Ricardo mendalami rent pada pertanian  Asumsi daerah subur yang baru sedikit porsi yang diolah untuk bertani demi menghidupi populasi  Rent tidak ada pada kondisi itu.  Rent timbul ketika ada kebutuhan untuk mem buka lahan yang kurang subur.

6 3.3. Classical Theories of Land Rent (2)  Illustration for Ricardo’s ItemsLand ALand BLand C Yield Total cost100 Cost per Unit 2,002,503,33

7 3.3. Classical Theories of Land Rent (3) (b) Von Thunen’s Theory  Based on distance to market  Closer to market  higher rent for the land  Illustration

8 3.3. Classical Theories of Land Rent (4)  Illustration for Von Thunen’s  A unit of land produce sugarcane (1 ha)  Total production of sugar = 10 ton per ha  Total cost production = $ 13,8 per ton  Price of sugar = $ 15 per ton  So, surplus per ton sugar = $ 1,20 per ton  If the land locates around the market, cost of transport = $ 0. Hence, total surplus $ 12 per ha. This is land rent

9 Von thunen  Jika Ricardo membahas perbedaan kualitas kesuburan lahan, maka von thunen menekankan pada fakta bahwa rent timbul dari adanya perbedaan lokasi.  Lahan yang dekat kota menikmati keuntunggan melebihi yang berjarak jauh dari kota.  Perbedaan itu dapat dinilai dalam bentuk biaya transportasi

10 Henry George  Interest in Capital Invested in Land Vs rent on land itself  Rent exist no matter owner or occupier the same or not  Rent merupakan bagian dari kekayaan yg diproduksi dari hak ekslusif pemilik tanah  Rent merupakan harga monopoli yang timbul dari kepemilikan individu

11 3.4. Using Marginal Value Approach to Estimate Land Rent (a) Concept of Marginal Product (MP) (b) Maximum profit  MP = w (upah riil) (c) Total Product (TP) (d) Total payment to labor (PL) = W x L (e) Land rent = TP – PL (f) Diagram Illustration

12 3.5. Comparing Land Rent for Two Different Quality Plots of Land  Differentials in land fertility  differentials in curves of AP, and MP  Lower quality land use less labor than higher quality of land  Land rent paid for lower quality land is smaller than that paid for higher quality land  Diagram illustration

13 3.6. Other Factors Affecting Land Rent (a) Production Technology (b) Price of output  condition of output market (c) Wage rate  condition of labor market

14 3.7. Population Pressure and Land Rent (a) Population pressure on agricultural land ?  Increase in work force due population growth  Supply of agricultural land  relatively fixed (b) Impact on land rent  Wage rate declines, while land rent increases (c) Population pressure is a conducive factor for land accumulation and marginalization to prevail in rural areas


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