unearned increment
The value of the land increased due to unearned increment from the new subway line.
Noun: An increase in the value of property or an asset that occurs without any effort, investment, or improvement by the owner. This rise in value is typically due to external factors such as general economic growth, population increase, infrastructure development, or changes in market conditions.
The term is used primarily in economics, real estate, and public policy discussions to describe profit gained passively, often raising questions about fairness and taxation. - It often carries a neutral or slightly critical connotation, highlighting that the gain was not a result of the owner's labor or merit. - It is commonly applied to land and real estate values.
- Noun:
- The city's new subway line caused an unearned increment in the value of all nearby properties.
- Some economists argue that taxing the unearned increment from land value is a fair way to fund public services.
- He sold the vacant lot for a large profit, most of which was pure unearned increment due to the neighborhood's popularity.
- Concept in Political Economy: The idea of the "unearned increment" was notably discussed by political economists like Henry George, who advocated for a "land value tax" to recapture this socially-created wealth for public benefit.
- Contrast with "Earned Income": This term is often explicitly contrasted with income earned through work, investment, or entrepreneurial activity.
- Windfall Profit (n): A sudden, unexpected profit, which may or may not be unearned. An unearned increment is a specific type of windfall profit from asset appreciation.
- Economic Rent (n): In economics, the extra income earned from a resource (like land) beyond what is needed to keep it in its current use. Unearned increment is closely related to the concept of economic rent arising from land.
- Unearned gain
- Passive appreciation
- Windfall gain (contextual)
- Earned income
- Active return
- Labor income
- "To reap where one has not sown": This idiom captures the ethical criticism often associated with the unearned increment, implying benefiting from the work of others or from sheer luck.
The value of the land increased due to unearned increment from the new subway line.
- an unearned rise in the market value of property resulting from general market factors