Replacing taxes on building structures with taxes on land-value results in more improvements to the land, measured as a higher capital-land ratio.

"A shift from property to land taxation (or the movement to a “graded” tax system under which land is taxed at a higher rate than the structures on the land) will reduce the “penalty” on improvements and encourage more intensive land use. Brueckner (1986) has demonstrated this proposition in a rigorous static analysis: the replacement of taxes on structures by levies on land-value will result in a higher level of improvements to the land (i.e., a higher capital-land ratio). We will refer to this as the capital-intensity effect."

empirical