This paper analyses the relationship between various conceptions of sustainable development and the role of land use planning from a Hayekian perspective. The focus of the paper is on a modified version of the Pareto principle and the manner in which this should be used to evaluate liberal market processes, relative to institutional alternatives. Using a comparative institutions analysis the paper develops a critique of the current practice of sustainability planning in the UK.
Following the Rio Earth Summit in 1992 governments throughout the world have been called upon to develop 'national plans, policies and processes' to ensure the implementation of sustainable development (United Nations Conference on Environment and Development, 1992). Successive British governments have identified the land use planning system as a central vehicle through which these objectives may be achieved. As such, the sustainability discourse has offered a lifeline to a profession that had perceived itself the victim of an ideological assault, initiated by the Thatcher administration in the 1980s.1
Notwithstanding the enthusiasm among academics and practitioners, it is the contention of this paper that the claims of the sustainability discourse are based on serious theoretical errors, which mirror the objections against more orthodox forms of planning practice originally set out by F. A. Hayek. While Hayekian criticisms of 'planning' are frequently held to be of relevance only to those forms of government action that abandon market processes entirely, this paper argues that attempts to 'steer' markets towards sustainability objectives are subject to the same obstacles besetting more ambitious planning schemes. The analysis is structured in four parts. section one sketches the principal features of sustainable development and their relationship to planning practice. section two considers some basic principles of institutional choice and their relationship to sustainability criteria. The focus here is on a modified version of the Pareto principle and the manner in which this should be used to evaluate liberal market processes, relative to institutional alternatives. Using these criteria, section three develops a Hayekian critique of sustainability planning in the UK. Building on this critique, the concluding section sets out some principles for institutional reform.
Sustainable development and the practice of land use planning
Since it was first enunciated in the Brundtland Report of 1987, sustainahle development has remained an essentially contested concept. There are many competing definitions which focus to varying extents on the environmental, economic and socio-cultural dimensions of 'development' that are to be 'sustained'. However, the unifying principle that underlies the discourse is the notion that the existing 'path' of development is in some sense 'unsustainable' and must be subject to a 'corrective' process at the societal/collective level.
Advocates of sustainability can be divided into two broad camps, each of which conceptualises a different, though related role for the land use planning system. The proponents of 'strong' sustainability argue that land use planning mechanisms should be used to identify those aspects of environmental systems that are 'irreplaceable' and which are said to constitute 'critical' natural capital. According to this perspective, protective land use designations (such as Areas of Outstanding Natural Beauty) should act as a fundamental constraint, providing an upper limit on economic development objectives, irrespective of any compensatory benefits that the latter might bring (Davoudi, 2001). While many proponents of strong sustainability focus exclusively on the definition of ecological limits, a subset of thinkers has sought to extend this approach to encompass the 'cultural' dimension. According to this view, an overemphasis on purely ecological constraints might allow for the loss of assets critical to the sense of heritage that many people feel is intimately bound up with the environmental landscape in which they live their lives (Owens, 1994; Owens and Cowell, 2001). …