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The Cost of Land Use Decisions: Applying Transaction Cost Economics to Planning and Development

ISBN: 978-1-4051-5123-8
208 pages
August 2007, Wiley-Blackwell
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This important new book tackles the ongoing debate between market and government in planning. By applying transaction cost economics to an evaluation of land use systems, the author provides a fresh angle and a useful contribution to a growing field of study for researchers in urban planning, public administration and land economics.

The book explains the relevance of the cost of land use decisions to planning practice and analyses institutions and transaction costs. The author offers evidence from three systematic empirical studies with detailed analyses of the planning of Nijmegen - Holland being known for its plan-led development; Bristol - where the UK planning system is characterised by being development-led and discretionary; and Houston - generally regarded as the city with no planning at all.

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Table of Contents

Preface .

1 The Cost of Making Land Use Decisions .


Beyond the ‘market versus the government’ debates.

The study of transaction costs in planning and property research.

The relevance for planning practice.

The structure of this book.


2 Institutions and Transaction Costs .

Economic approaches to institutionalism.

Institutions and transaction costs in the (early) new institutional economics.

Governance structures and property rights: building upon and refining Coase’s work.

How do transaction costs emerge? Transaction dimensions and economic behaviour.

Relationship between transaction costs and institutions.


3 Operationalising Institutions and Transaction Costs .

User rights regimes as particular governance structures.

A transaction-cost analysis of the development process: a methodology.

The empirical research.


4 Nijmegen: The Quest for Control in Corporatist Tradition .

Dutch planning and property law.

The Marialaan project: small but complex.

Transaction-costs analysis of the Marialaan.


5 Bristol: Planning In Uncertainty .

English planning and property law.

Wapping Wharf.

Transaction-cost analysis of Wapping Wharf.


6 Houston: Planning in the City That Does Not Plan? .

Planning in the US: social conflict over property rights.

Houston: no zoning, but not unregulated.

Houston city planning in practice: Montebello.

Transaction-cost analysis of Montebello.


7 Comparing and Explaining Transaction Costs: Learning from the Cases .

The user rights regimes compared.

Transaction costs entangled in structures.


8 Transaction Costs and the Institutional Context .

The quest for control over development.

Relationship between public and private sector.

Attitudes towards transaction costs.

Legal styles: Flexibility, certainty and accountability.


9 Planning at What Cost? Conclusions and Discussion .

Applying transaction cost theory to planning and development.

Transaction costs as dead weight losses or means with a purpose?.


Appendix A: Interviewees .

Appendix B: People Working in Planning .


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Author Information

Edwin Buitelaar is an assistant professor in the department of Spatial Planning of the Radboud University Nijmegen, the Netherlands. Since February 2007 he also works as a researcher at the Netherlands Institute for Spatial Research in The Hague. His research concentrates on land markets and land use planning from an institutional angle.
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The Wiley Advantage

  • provides evidence from three sytematic empirical studies

  • useful contribution to a young but growing field

  • complements the more theoretical publications
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"Anyone with a general interest in urban planning can benefit from this text." (Construction Management and Economics, October 2008)

"Readers of the book will benefit from its enlightening cross-national analysis. The Cost of Land Use Decisions succeeds in tracing the roots and current expression of three distinct planning regimes, with the lens of transaction costs bringing their similarities and differences into clearer focus." (Journal of Regional Science, February 2009)

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