ifo Institute in Favor of Demand-Oriented Land Development

The ifo Institute has come out in favor of gearing land development permits more closely to the needs of the economy. “If new apartments have to be built in a growing major city, you also need land to build them on,” says Joachim Ragnitz from the ifo Institute’s Dresden Branch. “The same applies when municipalities want to designate new business parks or build roads. Restricting land use could slow a region’s growth and drive up prices.”

Ragnitz is in favor of allowing an increase in areas given over to transport and residential buildings in Germany if regions develop rapidly. This could be tied to growth in the local population or workforce. “There’s no question that an increase in the total area of impervious surfaces can be a problem. However, the federal government shouldn’t place land protection above other economic policy goals,” Ragnitz says.

In its sustainability strategy, the German government aims to reduce the use of new land for residential and transport purposes to less than 30 hectares per day by 2030. If this is not feasible, it will set planning specifications for this.