Creation of property rights in planning by contract and edict: Beyond "Coasian bargaining" in private planning
This article advances the proposition that the creation of property rights, whether by contract upon negotiation or edict, is far more significant than what has been described as "Coasian bargaining" in effecting sustainable development. By "creation" we intend the neo institutional economist's sense of establishing a degree of exclusive property rights for common property or devising new contractual arrangements in which private property rights are entrenched. This is sometimes mistakenly confused with the assignment of property rights. "Sustainable development" is understood as the transformation of negative into positive externalities or a state of the tragedy of the commons into a vibrant resource nourishing industry. Two real world cases involving government planning are used to illustrate this proposition.