Public open-space conservation under a budget constraint

•This paper analyzes the fiscal and land value impacts of open-space conservation.•This paper examines where open-space conservation increases land value.•Open-space conservation can increase total land value in many American cities.

This paper analyzes the fiscal and land value impacts of public open-space conservation in a budget-constrained city. It derives the necessary and sufficient conditions for open-space conservation to increase the level of municipal services and the total land value within the city. The theoretical results, together with the empirical evidence found in the literature, suggest that open-space conservation can increase the level of municipal services and total land value in a significant share of American cities even if it generates no amenities. Open space conservation will likely increase total land values and municipal services in metropolitan areas that have stringent land use regulations, high development densities, and relatively little open space, but will likely reduce municipal services and total land values in small, lightly regulated cities surrounded by rural land and fiscally constrained in providing essential public goods (H4, R3, Q2).