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Planning Reform and Housing Costs: Why The Coalition Failed and What it Means
Author(s) -
Niemietz Kristian
Publication year - 2012
Publication title -
economic affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.24
H-Index - 18
eISSN - 1468-0270
pISSN - 0265-0665
DOI - 10.1111/j.1468-0270.2012.02177.x
Subject(s) - nimby , incentive , opposition (politics) , public economics , economics , nothing , demographics , population , incrementalism , business , development economics , market economy , political science , engineering , law , sociology , politics , philosophy , civil engineering , demography , epistemology
Housing costs in the UK have exploded in recent decades. Contrary to what is often claimed, this has nothing to do with population density, demographics or a lack of public housing. A review of the empirical literature shows that the key determinant of housing costs is the severity of planning restrictions. Faced with a well‐organised NIMBY opposition, the coalition failed in its attempt to make the planning system more development‐friendly. This is not surprising, because the current system provides incentives which make NIMBY ism a rational option. The coalition ought to address these incentives rather than trying to sidestep them.