Americans in metropolitan areas contemplating regional land use controls to contain urban sprawl and preserve open space might consider the experience of Britain, where widespread restrictions on development have been in place for 50 years. Under the direction of a government ministry, local planning authorities control the development of property throughout the country.

Economist John Corkindale, in a recent study from the Institute of Economic Affairs, say this regulatory scheme is costly to run and imposes substantial economic costs on society.

• For the United Kingdom as a whole, the direct cost of running the system is about £1 billion a year.

• In a comparison of the towns of Reading and Darlington, researchers found that if Reading had adopted the more relaxed planning regime of Darlington, house lots in Reading would have been 65 percent larger, and the total area of the city would be 50 percent larger.

• Furthermore, land prices in Reading would have fallen considerably and annual real incomes would be higher by 6 percent to 8 percent; thus development restrictions cost each household an average of £640 to £775 per year.

Corkindale point out that little research has been done to determine the national economic costs of the system, or even to decide what benefits have been obtained. And planning decisions don't even reflect the desires of local people since authority is centralized in unelected bureaucracies.

He also says that it is an ethical contradiction that landowners who are denied permission to develop their property are rarely compensated, while those who do obtain permission are allowed to receive all the economic value of their development rights. Thus, in effect, the British "nationalized land development rights and allowed planning authorities to re-privatize those rights on a partial and discretionary basis."

Source: John Corkindale, "Reforming Land-Use Planning: Property Rights Approaches," IEA Studies on the Environment No. 12, 1998, Institute of Economic Affairs, 2 Lord North Street, Westminster, London SW1P 3LB, U.K., (0171) 799-3745.

For more on State and Local Regulations http://www.ncpa.org/pd/state/state4.html