IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Land use planning challenges and tools—tradeable development rights: design considerations

Listed author(s):
  • Karanja, Francis
  • Rama, Ismo

Tradeable development rights (TDRs) are market based instruments that allow a right to develop a parcel of land to move from one parcel to another. We examine TDRs as a potential instrument for achieving the economic objective of allocating development to its highest value use in Victoria. TDRs are examined as a tool within Victoria’s existing planning system for rural land, which has a number of objectives. Design considerations for applying TDRs in Victoria include the need to consider modifying development entitlements from a right to apply (RTA) to a right to develop (RTD). It will also be important to address potential infrastructure externalities. Additional challenges include developing a suitable metric, addressing potential development hotspots and non-quantity development attributes, considering potential leaks, clarifying distributional impacts, and addressing credible commitment mechanisms. We consider the potential for TDRs to contribute to a series of land use outcomes. We find that using TDRs to protect agricultural does not appear to address underlying market failures that may contribute to excessive urban sprawl and encroachment on agricultural land. TDRs offer a potential source of adjustment income, although other instruments may assist in a more effective and transparent manner. TDRs can be directed to protecting native vegetation; however, Victoria has existing and emerging instruments in place to target this objective. Finally, TDRs offer potential for the more efficient allocation of well specified development rights, which would require modification of the existing planning framework to accommodate the design challenges noted above.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by Australian Agricultural and Resource Economics Society in its series 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia with number 100701.

in new window

Date of creation: 2011
Handle: RePEc:ags:aare11:100701
Contact details of provider: Postal:
AARES Central Office Manager, Crawford School of Public Policy, ANU, Canberra ACT 0200

Phone: 0409 032 338
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ags:aare11:100701. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.