Town Planning Review

Proprietary governance and property development: Using changes in the property-rights regime as a market-based policy tool

Town Planning Review (2007), 78, (1), 23–39.

Abstract

This paper presents an analytical model for the development of real estate. The model describes the relationship between property-rights regimes and property development. A property-rights regime can be defined as an integrated system that includes civil law, public law and other types of law (like fiscal law and contract law) that influence the property market. The basic idea to be explored is that a change in a property-rights regime can serve as a non-directive, market-based policy tool in property development. The operation of (new) markets for rights in land can be stimulated by means of redefinition, attenuation or other types of change in the property-rights regime. This tool, called proprietary governance, can influence the interaction between market agents in an indirect way and could in that respect be an alternative to more directive policy tools that are mostly used in planning. The model is illustrated with examples of potential changes in the property-rights regime in The Netherlands that influence the development of residential real estate.

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Geuting, Esther