Merge pull request #1583 from PolicyEngine/codex/improve-corporate-land

Improve corporate land allocation

Author: MaxGhenis

changelog.d/corporate-land-allocation.fixed.md

@@ -0,0 +1 @@
+Fixed `corporate_land_value` to allocate aggregate corporate land using the current weighted distribution of `corporate_wealth`, and refreshed the aggregate land parameters to the 2024 ONS land totals used by `policyengine-uk-data`.

policyengine_uk/parameters/household/wealth/land/value.yaml

@@ -8,6 +8,12 @@ aggregate_household_land_value:
     2018-01-01: 3_947_306_000_000
     2019-01-01: 3_961_152_000_000
     2020-01-01: 4_309_138_000_000
+    2021-01-01: 5_047_690_687_279
+    2022-01-01: 5_070_355_908_968
+    2023-01-01: 4_798_764_603_941
+    2024-01-01: 5_041_350_906_096
+    2025-01-01: 5_041_350_906_096
+    2026-01-01: 5_041_350_906_096
   metadata:
     unit: currency-GBP
     label: Total direct household land value
@@ -25,6 +31,12 @@ aggregate_corporate_land_value:
     2018-01-01: 1_695_825_000_000
     2019-01-01: 1_683_117_000_000
     2020-01-01: 1_757_818_000_000
+    2021-01-01: 2_059_094_312_721
+    2022-01-01: 2_068_340_091_032
+    2023-01-01: 1_957_550_396_059
+    2024-01-01: 2_058_649_093_904
+    2025-01-01: 2_058_649_093_904
+    2026-01-01: 2_058_649_093_904
   metadata:
     unit: currency-GBP
     label: Total corporate land value

policyengine_uk/tests/test_corporate_land_value.py

@@ -0,0 +1,65 @@
+from policyengine_uk import Simulation
+import pytest
+
+
+def test_corporate_land_value_matches_aggregate_for_weighted_dataset():
+    sim = Simulation(
+        situation={
+            "people": {
+                "person_1": {"age": {2025: 40}},
+                "person_2": {"age": {2025: 50}},
+            },
+            "benunits": {
+                "benunit_1": {"members": ["person_1"]},
+                "benunit_2": {"members": ["person_2"]},
+            },
+            "households": {
+                "household_1": {
+                    "members": ["person_1"],
+                    "corporate_wealth": {2025: 100_000},
+                    "household_weight": {2025: 2},
+                },
+                "household_2": {
+                    "members": ["person_2"],
+                    "corporate_wealth": {2025: 300_000},
+                    "household_weight": {2025: 1},
+                },
+            },
+        }
+    )
+
+    corporate_land_value = sim.calculate(
+        "corporate_land_value", map_to="household", period=2025
+    )
+    household_weight = sim.calculate(
+        "household_weight", map_to="household", period=2025
+    )
+    aggregate = sim.tax_benefit_system.parameters(
+        "2025"
+    ).household.wealth.land.value.aggregate_corporate_land_value
+
+    assert corporate_land_value[0] == pytest.approx(aggregate * 0.2)
+    assert corporate_land_value[1] == pytest.approx(aggregate * 0.6)
+    assert (corporate_land_value * household_weight).sum() == pytest.approx(aggregate)
+
+
+def test_corporate_land_value_is_zero_without_corporate_wealth():
+    sim = Simulation(
+        situation={
+            "people": {"person": {"age": {2025: 40}}},
+            "benunits": {"benunit": {"members": ["person"]}},
+            "households": {
+                "household": {
+                    "members": ["person"],
+                    "corporate_wealth": {2025: 0},
+                    "household_weight": {2025: 1},
+                }
+            },
+        }
+    )
+
+    corporate_land_value = sim.calculate(
+        "corporate_land_value", map_to="household", period=2025
+    )
+
+    assert corporate_land_value[0] == 0

policyengine_uk/variables/household/wealth/corporate_land_value.py

@@ -11,9 +11,17 @@ class corporate_land_value(Variable):
     quantity_type = STOCK
 
     def formula(household, period, parameters):
-        wealth = parameters(period).household.wealth
         corporate_wealth = household("corporate_wealth", period)
-        corporate_wealth_intensity = (
-            wealth.land.value.aggregate_corporate_land_value / wealth.corporate_wealth
+        household_weight = household("household_weight", period)
+        total_weighted_corporate_wealth = (corporate_wealth * household_weight).sum()
+        if total_weighted_corporate_wealth == 0:
+            return corporate_wealth * 0
+
+        aggregate_corporate_land_value = parameters(
+            period
+        ).household.wealth.land.value.aggregate_corporate_land_value
+        return (
+            corporate_wealth
+            / total_weighted_corporate_wealth
+            * aggregate_corporate_land_value
         )
-        return corporate_wealth * corporate_wealth_intensity