What price planning? Reimagining planning as “market maker”

Abstract

Planning has been widely vilified for the role it plays in disrupting the development process, hindering economic growth and creating the conditions for undersupply in housing markets characterised by unaffordability. In this paper we hope to show that the analyses that support this view of planning are incomplete because of the theoretical limitations of the neoclassical tradition from which they emerge. By way of alternative we posit an account of planning that draws upon game theory and behavioural economics to explore those aspects of the activity that serve to animate the development process. This interpretation of planning as a 'market maker' is explored through empirical case study research from three Continental European contexts where planning is charged with playing an economically active role to control liquidity.

How do planners manage risk in alternative land development models? An institutional analysis of land development in the Netherlands

“…A fundamental feature of land readjustment is that land acquisition is absent from, but land assembly is facilitated by, the model. Indeed, transaction costs associated with land assembly issues of the first mover problem, the free rider problem and the holdout problem are addressed by land readjustment (Lord and O'Brien, 2017). Transaction costs for land acquisition are therefore zero, though transaction costs for land assembly can be extremely high, in spite of this being an aim of the model, because of the voluntary nature of urban land readjustment in the Netherlands.…”

“…The paper proceeds as follows. First, we discuss how planning has been influenced by theories and methods from economics, using this discussion to frame the conception of planning and markets as interrelated, rather than opposing, spheres (Alexander, 2001a;Adams and Tiesdell, 2010;Lord and O'Brien, 2017;Lord and Gu, 2019). Second, we consider the relationship between planning and risk, and the treatment of risk by planning agencies, noting the potential utility of institutional analysis to address these issues.…”

Revisiting the Purpose of Land Policy: Efficiency and Equity

“…Precise assessment of efficiency and equity impacts is impossible due to policy interactions, which often hinder determining their real final impact (Whitehead 1983), or due to many various environmental and social effects which would need to be disentangled before their economic assessment (Lord and O'Brien 2017). Methodological difficulties further undermine the possibility of assessing efficiency impacts to calculate nonmonetary values necessary for these assessments.…”

Can the market be tamed? A thought experiment on the value(s) of planning

“…The net result of work in this vein has been to challenge the logic that real-estate markets would respond effectively to market signals if it was not for the planning system. Correspondingly, the argument has emerged that there may be value in thinking of planning as a 'market maker' (Lord and O'Brien, 2017) and that planning may be conceived as an important foil to the neoliberal hegemony rather than explicitly incompatible with it.…”