Cities Without Land Markets: Location and Land Use in the Socialist City

22 Pages Posted: 20 Apr 2016

See all articles by Alain Bertaud

Alain Bertaud

NYU - Stern Urbanization project; Bertaud consulting; World Bank - World Bank Institute (WBI)

Bertrand Renaud

University of California, Berkeley

Date Written: June 1995


The authors describe the structure of Russian cities after 70 years of Soviet development. This is the longest socialist experience on record and its results are of paramount interest to urban economists. In the absence of price signals and of economic incentives to recycle land over time, the administrative-command process has led to a startling pattern of land use. Its central feature is a perverse population density gradient, which rises as one moves away from the center of the city. (Driving from the center of Moscow, one passes through rings of Stalin-era, Krushchev-era, and then Brezhnev-era flats.) The Soviet city is also characterized by rusting factories in prime locations and high density residential areas in distant suburbs. Such a structure tends to maximize the economic and social inefficiency of the socialist city as well as its environmental ill effects. With market-oriented urban reform, real estate prices are now emerging. Their negative gradient signals again the massive scale of past land misallocation in the Soviet city. The experience of socialist cities is also a powerful warning about the ill effects of public ownership and the allocation of land to achieve the socialization of land rents.

Suggested Citation

Bertaud, Alain and Renaud, Bertrand, Cities Without Land Markets: Location and Land Use in the Socialist City (June 1995). World Bank Policy Research Working Paper No. 1477. Available at SSRN:

Alain Bertaud (Contact Author)

NYU - Stern Urbanization project ( email )

New York, NY

Bertaud consulting ( email )

166 Forest road
Glen Rock, NJ 07452
United States

World Bank - World Bank Institute (WBI) ( email )

Washington, DC 20433
United States


Bertrand Renaud

University of California, Berkeley ( email )

310 Barrows Hall
Berkeley, CA 94720
United States

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