Are Some Planning Transactions Intrinsically Sovereign?

The laws, policies, customary practices and other institutions that govern a country's land development and the pattern of its spatial economy are constantly evolving. They change at the margin and by catastrophe; involving major land reform, minor statutes, economic crises, and gradual shifts in the way things are done. This article analyses the institutions of planning using qualitative models of incomplete contracting. It portrays them as fluid social constructs that adapt according to the relative costs of organizing the transactions that constitute a planning service. The focus is on the way organizational and institutional structures influence and are determined by post-contractual hazards. Post-contractual hazards are risks to the desired outcome of a transaction (for example the risk that a commissioned plan proves to be unworkable or irrelevant). Attention is specifically drawn to probity hazard (following economist Oliver Williamson, 1999). A set of core planning functions (transactions) are examined with the purpose of discovering if there are a priori arguments for retaining certain parts of a planning system within the public bureaucracy.