The Determinants of Land Values in an African City: The Case of Accra, Ghana

Abstract

Problems associated with urban areas, such as overcrowding, obsolescent and abandoned buildings, traffic congestion, haphazard or uncontrolled development, and fiscal insufficiencies, have spurred a vast amount of research toward the understanding of the economics of the cities of the developed countries of the world. Little, however, is known about the economics of the cities of the developing countries of the world, especially African cities. Urban land is used virtually in every urban function, including transportation, production, government, and consumption activities. The price of land allocates space among alternative uses. Failures in the allocative function of land values are directly related to many of the problems facing urban areas. Governmental decisions like urban zoning, land-use planning, urban renewal schemes, various land-reform measures, and so on, which are aimed at solving these problems, however, require specific assumptions concerning land values but may also be responsible for creating or exacerbating some problems. A clear understanding of the determinants of land values must, therefore, precede the formulation and implementation of all land-related policies. Among the necessary steps toward the understanding of the determinants of land values and the issues related to the allocative function of land values are case studies, especially of areas that are demonstrably different from those already studied. The objective of this study is to report such an investigation. The study area is Accra, Ghana. Accra, the capital city of Ghana, has an estimated population of 1,400,000 people (see Bobo 1974). By virtue of its function as a capital city, Accra has become the major center of government and the major trading and service center of the country. Accra exerts more influence over Ghana in terms of population movement than any other major city in Ghana. As has been the case with other African capitals, the population of Accra has been increasing rapidly due to ruralurban migration. The population of Accra, for example, increased by as much as 126% between 1948 and 1960. The increase from 1960 to 1970 for Accra (including Tema) was 181%.' The result of