yes, tax does affect behavior

The simple economic case for land rent is that land is inelastic. That is, if you tax land, you won't end up with less land. But if you tax elastic things like production, some production becomes uneconomic and people do less of it. Today's Adam Smith blog is a good example, discussing the effect of oil prices and other costs on the economy. (The question of sustainable oil was discussed here in an earlier blog.)

(Some people criticize my use of a right wing site like Adam Smith Institute. But I find that, apart from the core issue of ownership, they make a lot of sense. Of course, ownership is the whole basis of capitalism, so that one caveat is rather important.)

Intelligent taxation - another benefit of land rent.