An economic analysis of transferable development rights

Down zoning regulation policy is liked by urban planners as a powerful tool of the urbangrowth control. This policy takes the form of constrained floor-arearatio (FAR) which is set below the FAR determined by a free market, and by doing so it aims to suppress the construction of office buildings within a specific city. For economists it is almost self-evident that such physicalregulation produces inefficiency of resource allocation by distorting free ground-rent formation in the ..