Institutional Economics and Policies for Changing Land Markets: The Case of Industrial Estates in the Netherlands

Abstract

Public policies for land use include many rules and regulations. Changing those policies usually means changing rules. Institutional economics studies the effects of rules on economic behaviour and how of those rules change under economic forces. Therefore, economic theories of institutional change can be applied when designing new policies for land markets. This theoretical framework is applied to the policy followed in the Netherlands for industrial estates. This policy has been stable for approximately 60 years and shows little signs of change, even though some of its effects are not what the policy makers want. That continuity in the face of policy contradictions is explained here by economic theories of institutional change. They are applied here also to find practicable ways of changing the policy for industrial estates.