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The conflict between world cultural heritage and local communities is investigated by using the cultural landscape heritage of West Lake in China as a case study, and establishing an analytical framework of “Rights–Values–Interests” based on the property rights theory of the new institutional economics and the value and interest structure characteristics of cultural heritage. The conflict problem in the market environment is analyzed based on a theoretical explanation. An in-depth discussion of the framework and improvement of China’s protection institution is provided. We outline the following key points: First, the Chinese government “plundered” certain behavior rights and legitimate interests of community residents through the enactment of protection laws, leading to a conflict between the protection and community. Second, China’s laws lack a clear definition of the power and responsibility of the central and local governments with regard to protection actions, leading to vague positions of the government and exacerbating conflicts. Third, China’s protection laws are out of touch with the laws of private property rights. The root cause of the conflict is that the protection action only considers the protection law as the core but neglects the residents’ legal behavior rights. Finally, from the perspective of considering the residents’ legitimate interest demands, defining behavior rights boundaries, and strengthening administrative management, we propose to improve the protection institution in order to achieve the harmonious integration of heritage protection and local communities, and we call for a greater focus on the legitimate interests or survival rights of ordinary Chinese community residents.

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Rights–Values–Interests: The Conflict between World Cultural Heritage and Community: A Case Study of the West Lake Cultural Landscape Heritage in China