Planning, Urban Land Economics and Urban Economics

Abstract

Economics at its simplest is focused on the ways that the three basic resources of land, labour and capital are used to produce outputs. Given that it is difficult to create new land, it is generally regarded as a scarce resource and an essential good. When combined with capital as the main feature of land creates our housing and property markets. This makes an understanding of how an economy functions an essential tool for planner. The growing understanding of the links between economics and planning in the mid-1960s lead to the development of new areas of economic thought. Urban land economics ‘deals with the processes and patterns of land utilization’ , in an urban setting, grew out of the older land economics. Land economics specifically looked as how land is utilised as part of a productive system. The more focused urban land economics deals with a range of issues of interest to planners including the workings of the urban land market, the land development process, land and housing markets complexities, and the impact of planning on those markets and processes. Much of the literature on urban land economics was developed within the context of land markets and the political and planning systems in the United States, Britain and Europe. This chapter intends to explore how the main theories of urban land economics can be adapted to be of use in the political and planning systems that exist in New Zealand. To do this the chapter also covers some basic economic concepts and issues which are at the heart of urban land economics. It will then go on to look at the role of planning in economics in general and in urban land economics before moving to a discussion of some significant economic driven issue facing planners such as housing supply and affordability.