The elasticity of supply of land is zero. A tax on land results only in an income effect to landlords. Then it follows that a 10-percent tax on land rents will:

Question

Quizplus · Accepted Answer

A tax on land with perfectly inelastic supply (elasticity of supply is zero) cannot be shifted to others, so landlords bear the full tax burden. Since the supply is perfectly inelastic, there is no change in quantity supplied, resulting in zero excess burden.

The Elasticity of Supply of Land Is Zero