Keywords

2.1 Part I: Theoretical Approach—Actors-Centered New Institutionalist Political Ecology

To understand the process of implementing densification goals in-depth and its socio-political consequences on different categories of stakeholders and their responses, the theoretical lens employed in this book applies an actors-centered new institutionalist political ecology approach. This approach builds a bridge between several disciplines with a spatial interest, in particular public policy analysis (planning as a public policy), new institutional economics (property rights), and political ecology (power).

By combining these perspectives, this approach makes it possible to recognize why many different stakeholders can come into conflict with each other. It allows for a more systematic analysis to examine how various actors behave in response to a specific socio-political setting and proves to be particularly suitable for the analysis of joint use situations in which several different users find themselves as rivals (such as in densifying urban environments). Moreover, it enables to systematically capture power games among actors to explain the function and evolution of structures that drive conflict and socio-environmental disputes in the first place. Hence, it allows us to reveal potential loopholes or challenges of densification implementation in more detail.

Regarding the compact city, more precisely, this new institutionalist political ecology approach acknowledges—for instance—that different actors involved (e.g. owners, public authorities, NGOs, residents) try to shape the implementation of densification. Thus, densification objectives never get implemented on a one-to-one basis. Rather power games influence the way their implementation is or can be realized. Veto rights controlled by powerful stakeholders, as well as the negotiation of intertwined private and public interests, influence the way densification is being performed. Those actors simultaneously aim to defend their own interests and objectives, e.g. to preserve affordable living space, to save or consume energy, or to invest capital.

The shift towards the compact city increases the potential for use conflicts among these actors as it implies that they deal with the already built environment within firmly established city boundaries. Each one follows different strategies to defend their own interests and to achieve their goals of resource use in densifying city areas. In the chapters to come, densification is thus regarded and conceptualized as a highly socio-political challenge because its implementation results in losses for some and wins for others.

2.1.1 From Classic to New Institutionalism: Historical Background of Institutional Thought

To understand what socio-political structures challenge the implementation of densification objectives, this book largely builds on theories and concepts of new institutionalism. Historically, institutional thought has a rich and diversified history in the social sciences (for discussion, e.g. Dembski & Salet, 2010; Immergut, 1998; Mandelbaum, 1985; March & Olsen, 1989). In general, an institutional analysis approach makes it possible to explain human behavior as results of joint values, norms, routines, and procedures stipulated in formal rules, codes, and ordinances that guide social behavior and action. Institutions are defined as “the conventions, norms, and formally sanctioned rules of a society. They provide expectations, stability and meaning essential to human existence and coordination. Institutions regularize life, support values and protect and produce interests” (Vatn, 2005: 24).Footnote 1 They range from the rules of a constitutional order to the standard operating procedures of a bureaucracy or firm relations. Classic institutionalists regard the institutional organization as the principal factor structuring collective behavior in society and in generating distinctive outcomes (Hall & Taylor, 1996: 937). Following this approach facilitates an understanding of how densification as a process is embedded into diverse institutional structures (laws and policies) that influence actors’ decision-making behavior.

By the end of the 1980s, scholars of several sub-disciplines of political science studies, economics, and sociology rediscovered, quite independently from each other, the potential of this approach and began talking of a “new institutionalism” (for discussion, e.g. Koelble, 1995). In contrast to classic institutionalism (see previous paragraph), which often led to unraveling the functioning of institutions in a descriptive and legalistic language (Thelen, 2003), new institutionalism or neoinstitutionalism as a theoretical concept developed from the behavioral, cultural, and spatial turn during the 1960s and 1970s. The main purpose of this turn was to elaborate upon the role of institutions in the determination of social and political outcomes in more detail (Hall & Taylor, 1996: 936).

In particular, neoinstitutionalists have started to acknowledge that it is exceptionally relevant to analyze the key attributes of human action for understanding sustainable development. Different categories of institutional rules have become considered necessary for understanding the outcomes of social behavior and practice. Simultaneously, institutions themselves have come to be understood as a product of social construction rather than given per se (e.g. Williamson, 2000). In contrast to classic institutionalism, new institutionalism goes one step further in the sense that it raises new questions: for instance, why institutions have emerged the way they did. It also focuses more closely on microanalytic perspectives and criticizes the image of social causation as “path dependent”, while respecting that the effects of institutions are mediated by contextual features of a given socio-political situation and are often inherited from the past (Hall & Taylor, 1996; Healey, 1996, 1999; Powell & DiMaggio, 1991). New institutionalists have also started to emphasize in a more detailed manner that, besides the importance of public policies, property rights (e.g. Demsetz, 1967; Jacobs & Paulsen, 2009), rent-seeking, and transaction costs (costs other than those involved in the physical production of buildings) (Coase, 1960) play a crucial role in the operation and development of institutions. In Sect. 3.4, particular emphasis is put on the different forms of institutional rules influencing densification implementation.

2.1.2 From Hardin to Ostrom: Towards Political and Actor-Centered Neoinstitutionalism

In this book, densification procedures in the urban housing sector are analyzed by applying theoretical concepts deriving from political and actor-centered neoinstitutionalism (e.g. Mayntz & Scharpf, 1995; Scharpf, 1997, 2000). This approach has received its popularity with the Nobel-Memorial-Prize-winningFootnote 2 political scientist Elinor Ostrom in 2009. Ostrom won the award in economics because she disapproved of Garret Hardin’s concept of “The Tragedy of the Commons” (1968). In his metaphor, Hardin argued that a common good such as land for cattle could not be used in a sustainable way, as finally, this would lead to overuse and unproductivity of the land. He saw this observation as an irrefutable argument for the superior efficiency of private property rights in the management of land and other common pool resources (CPRs) such as air or water as well as an undeniable justification for privatization.Footnote 3

Elinor Ostrom, however, countered some of Hardin’s presumptions in her book Governing the Commons (1990) and showed that it is, in fact, private property in cattle and individual utility maximizing behavior that lies at the heart of the problem rather than the common property character of the resource. To prove her assumption, she analyzed the sociological, historical, and anthropological structures that guide the use of natural resources and showed that, if the herders talked to each other, or shared cultural customs and procedures, they might be able to solve any commons challenge. She showed that individuals are capable of developing sensible collective ways to manage common property resources for individual and collective benefit. Her main concern was then to investigate how and why in some cases stakeholders succeed in doing so and under what conditions they do not.

With the findings of her research, she questioned the long-lasting economic orthodoxy, which only recognized policy in terms of a dichotomous choice between state and market, but not as a stand-alone and integral part of the socio-economic system that determines the use of sustainable resources (Harvey, 2012: 191–207). Her results have led to the recognition and integration of more cultural approaches of sociology, anthropology, and philosophy in political economy (e.g. Berger & Luckmann, 1966; Bourdieu, 1977, 1998; Weber, 1968). Scholars of this research field have started to (re)consider social norms and their guidance function over action, in addition to purely formal rules and procedures.

Indeed, Elinor Ostrom was one of the first to describe, analyze, and explain environmental problems and the unsustainability of natural resources use as results of institutional patterns and the involved actors’ individual behavior. She fundamentally questioned the dichotomy between the state and the private sphere and discussed the potential of other forms of use rights to regulate resources (e.g. public or collective). William Blomquist (2012: 370) concluded that Ostrom was a pioneer in raising unique questions such as “how people create property rights and for what purposes, why and how they choose the types of property rights institutions they do, and how and why they change property rights over time. […] She was explicitly and primarily concerned with (1) ‘who gets what, when, how’ to quote Lasswell’s (1936) famous characterization of politics; and (2) the even more intensely political questions of who decides who gets what, when, and how, and how that question is decided”. Ostrom accepted the fact that political use conflicts among rival groups lie at the heart of resource scarcity and raised awareness that environmental concerns are ultimately political problems (Bookchin, 1993).

Her work inspired many different scholars from other fields (e.g. anthropology, ecology, sociology), and particularly led to new debates and criticism in neoclassical economy. Connected to the writing of Elinor Ostrom, the award-winning economist Douglass C. North (1990, 1994), for instance, argued that neoclassical theory (e.g. Becker, 1976; Schumacher, 1973) failed as it does not consider political structures as a fundamental element explaining economic and environmental change. Neoclassical economics held the environment separate from humans and their economic activities. Therefore, the origins of resources depletion cannot be explained in-depth because markets are not recognized as results of socio-political structures and human action.

By the end of the 1970s, the research field—of which Ostrom and North became the most prominent representatives—was summarized under the new approach and term “New Institutional Economics”. This new approach “entails trade-offs between environment and development and the integration of the economy and the environment. Under the balance rubric, environmental justice, economic equity, and other manifestations of redistributive justice draw their basis” (Neuman, 2005: 19). The central message of new institutional economics is that institutions matter for economic performance. Because resource scarcity is mediated through institutions, it is acknowledged to be politically and socially constructed (Shahab et al., 2019: 541). As a refinement of the neoclassical model, new institutional economics regard the way by which property rights are allocated and enforced as determined by transaction costs because any kind of economic exchange results in external effects that need to be internalized by incentives. Changes from common to exclusive private property rights therefore leave room for unexploited gains of exchanges or benefits. While neoclassical economics consider this change in property agreements as triggered by self-interest and as results of spontaneous order, new institutional economists emphasize that they are imposed on society by civil authority, the state, and in the interests of individuals.

Later on, Elinor Ostrom incorporated her findings into the “Institutional Analysis and Development” (IAD) framework, which was used to systematically analyze policy processes and outcomes in the study of common goods such as fishery stocks or woodlands (Ostrom, 2005, 2007). According to Ostrom, the IAD helps to understand how governance systems enable individuals to solve specific problems democratically and how to organize diagnostic and prescriptive capabilities. Without the use of a framework, the systematic and comparative institutional assessment would not be based on analysis of performance, but instead on normative ideas about what kinds of institutions are “good” or “bad” (Ostrom, 2011: 7). Even though in this book the IAD is not applied, I agree that an analysis framework is needed to analyze densification processes systematically. In the following chapter, therefore, the Institutional Resource Regime (IRR) analytical framework is introduced, which allows me to address the research questions in an appropriate manner.

2.1.3 The Question of Power: Bringing a Political Ecology Perspective to Neoinstitutionalist Research

Political ecology is a field of research within socio-environmental studies. Its core endeavor is its focus on power relations, socio-economic and political processes as well as the coproduction of nature and society (Swyngedouw, 2009). It moreover focuses on the study of the relationships between political, economic, and social factors that cause environmental degradation (Robbins, 2004), and the reasons why land use conflicts arise in the first place (e.g. Lasswell, 1936; Ribot & Peluso, 2003; Robbins, 2004; Swyngedouw, 2009). Theoretical inspirations to explain environmental changes are taken from different sources grounded in human geography, social anthropology, development studies, or heterodox economics.

In contrast to apolitical explanations of environmental change (e.g. Neo-Malthusianism, Limits to Growth models), political ecology differs by politicizing environmental issues and phenomena. It demonstrates that natural resources use is linked with distributive political processes, practices, and power asymmetries among different groups of stakeholders (Gerber & Debrunner, 2021). Identification occurs by highlighting questions of power, responsibility, decision-making, capacity-building, and sustainability (e.g. Evans & Jones, 2008; Evans et al., 2006; Haller et al., 2016; Krueger & Agyeman, 2005). These authors provide an alternative view on mainstream environmental degradation discourse that often puts the blame on local communities or on the least well off from society in general. Moreover, these authors question the activity of resource exploitation that powerful economic actors engage in, and they make “explicit considerations of relations of power” (Robbins, 2004: 12).

In addition, the approach takes consideration of the political processes through which resource access is defined, negotiated, and contested at multiple scales (Zimmerer & Bassett, 2003). The status of powerful actors (e.g. conservation organizations, governments, businesses) and what is taken for granted in leading discourses is critically and explicitly questioned and reflected upon (Svarstad et al., 2018). Although political ecology approaches have so far mainly focused on environmental or land use change in the Global South, challenges in first world political ecology (such as the policy shift towards densification) demonstrate that political ecology perspectives also concern the Global North (McCarthy, 2002).

A useful definition of the school of thought can be found in Robbins (2004: 12), who describes political ecology as the attempt to search for “empirical, research-based explorations to explain linkages in the condition and change of social/environmental systems, with explicit consideration of relations of power. Political ecology, moreover, explores these social and environmental changes with a normative understanding that there are very likely better, less coercive, less exploitative and more sustainable ways of doing things”. Despite apparent agreement that power is at the core of political ecology studies, over the years diverse power definitions have been introduced. A popular definition was given by Ribot and Peluso (2003: 156), who defined power, first, as “the capacity of some actors to affect the practices and ideas of others […], and second, [that] power [is] emergent from, though not always attached to, people. […] Disciplining institutions and practices can cause people to act in certain ways without any apparent coercion”. Power is studied as contestations over material assets (land, natural resources) as well as over meaning (Benjaminsen & Svarstad, 2019: 391).

In this book, I focus on a particular political ecology perspective that emerged from the 1970s as a result of a Neo-Marxist critique of Malthusian ideas in environmental thinking (also the IRR analytical framework developed within this tradition) (see e.g. Ehrlich, 1986; Enzensberger, 1974). The argument was that studies of human ecology are never neutral or apolitical, but involve interests, norms, and power. In line with this understanding, power is then seen as “the ability to get what one wants from others. It may come from greater wealth or social position or the ability to manipulate the ideology of others” (Ensminger, 1992: 7). Not only are powerful individuals more likely to influence institutions to their own advantage, but also “any given set of rules or expectations - formal or informal - that patterns action will have unequal implications for resource allocation, and clearly many formal institutions are specifically intended to distribute resources to particular kinds of actors and not to others” (Mahoney & Thelen, 2010: 8). Powerful actors are those who know how to influence the goals of the others in a targeted manner to promote or to protect their own values, needs, and objectives. Vice versa, the institutional framework also shapes and affects all actors’ behaviors, as well as their negotiating power (Mackay et al., 2010).

Environmental degradation was and still is seen as caused by human impact and political choices creating winners and losers. In particular, Neo-Marxist political ecologists address the issue of power by relying on a political economy perspective (for detailed discussion see Haller, 2019; Svarstad et al., 2018) that insists on the need to link the distribution of power with productive activity and ecological analysis (Robbins, 2004). Such perspective points out the role of market (capitalistic) relationships in the stratification of society with differential distribution of power among social classes, and corresponding impact on resource use and overuses (Robbins, 2004). The study of power relations is connected to the question of who controls the access to and uses of natural resources. Whether through exclusive property rights or tenure arrangements or through mechanisms of social exclusion from decision-making (Ribot & Peluso, 2003). Hence, Neo-Marxist political ecology underlines the agency of resource users and aims to analyze the conditions triggering forms of resistance against more powerful actors following productivist objectives in the management of resources (Haller, 2019). It points out that ecological objectives should not be the starting point of analyses of resource degradation and sustainability, but socio-political conflicts—which are often unspoken environmental conflicts (Martínez-Alier, 2002)—targeting institutional change.

This book adds the above-mentioned political ecology perspective to neoinstitutionalist research (this chapter) as it not only endeavors to describe and to analyze socio-political phenomena, but also aims to explain and to critically question them. Vice versa, political ecology does not manage to identify power structures in any systematic way. Even though it might help to ask the right questions, it does not offer any assistance in providing concrete answers to them (Hengstermann, 2019: 8). Therefore, in this book, I aim to open this dialogue between new institutionalism and political ecology to insufflate greater power-awareness to neoinstitutionalist research. Power relations that drive densification are identified and systematically explained. In this chapter, Part II, I will continue to present the core elements of the Institutional Resource Regime (IRR) analytical approach in greater detail—especially how it is applied to the study objective of housing development in dense urban environments (Chapter 3).

2.2 Part II: Analytical Framework—The Institutional Resource Regime (IRR) and Its Focus on Property Rights

Based on the major conceptual shift that took place with the evolved approaches of new institutional economics (North, 1990, 1994; Ostrom, 1990), the Institutional Resource Regime (IRR) analytical framework has emerged. This particular neoinstitutional analysis approach combines new institutional economics and property rights theory with policy analysis (for discussion, Aubin, 2007; Gerber et al., 2009, 2020; Knoepfel et al., 2001, 2003). The IRR framework is rooted in political science or, to be more precise, environmental policy analysis. It enables “a systematic analysis of the institutional context that influences actor behaviour and the use of natural resources” (de Buren, 2015: 9). It moreover postulates that a combination of approaches from political science (in particular policy analysis) and institutional economics (of property rights) ensures the identification of the most relevant institutional dimensions, which can explain the (un)sustainable use of resources (Gerber et al., 2009: 799). Thereby, distinct insights into the diverse array of regulatory conditions and actors are provided.

Other than Ostrom’s IAD framework, the IRR explicitly distinguishes between two main sources of formal rules—public policies (Sect. 2.2.2) and property rights (Sect. 2.2.3)—which simultaneously influence the use and disposal rights of resource use and have very different characteristics (Gerber & Nahrath, 2013: 12). The IRR does not only focus on single use situations with model character (e.g. pastures for cattle) or analyze a limited number of actors, but it rather follows a more comprehensive approach. It proves to be particularly suitable for the analysis of joint use situations in which several different users find themselves as rivals (such as in dense urban environments) because it is able to fully take into account the role of the public state (Knoepfel et al., 2003).

In contrast to the IAD, the IRR framework facilitates an understanding of how various actors behave in response not only to changes in the individual regulations of the institutional setting but also to various characteristics of the institutional rules involved as a whole (Nicol, 2011: 460). To identify conflicts that arise during contested use situations, which potentially hamper a resource’s sustainability, the IRR examines in-depth how and why rival use situations between multiple actors emerge. This high complexity of user situations helps “to understand a more representative range of resources uses [in order to] be capable of portraying the complexity of heterogeneous use situations” (Gerber et al., 2009: 800). In this book, the IRR’s ability to analyze complex use situations becomes particularly relevant since densification potentially exacerbates resources use conflicts among actors due to limited land availability.

In sum, this approach is to be seen as the next generation of institutional analysis as it incorporates earlier models, such as Ostrom’s IAD (2007, 2009). It allows for analyzing behavioral patterns stemming from incentives of different policy fields such as contradictions between public policies (e.g. planning law) and property rights (e.g. Civil Code). Furthermore, a major strength of the IRR framework is its ability to conceptualize institutions in a way that echoes real-life resource use situations by taking their complexity into consideration and to propose causal mechanisms explaining the relationship between institutions and sustainability. The IRR therefore contributes to a broad set of questions on the political and institutional dimensions of resource governance (Gerber et al., 2020).

It must also be noted that Ostrom’s IAD originated in the context of the Anglo-Saxon legal system (common law countries) while the IRR has evolved in countries with a codified legal system (civil law countries). This further presents an added value of the analytical framework applied in this book.

2.2.1 The Institutional Regime: Two Sources of Formal Rules Regulating Resources Use

As mentioned before, the IRR distinguishes two main categories of formalized rules—public policies and property rights—that operate according to a different logic and rely on opposing legitimizations. These two sources of institutional rules form an Institutional Regime that regulates resources uses. A regime is understood as “the more or less coordinated combination of public policies and property rights that relate to all user-actors of the resource, and thus affects the reproductive capacity of the resource and hence its sustainability” (Nicol & Knoepfel, 2008: 161). An institutional regime defines an explicit (or implicit) structure of rights and duties, characterizing the relationship of individuals to one another with respect to a particular resource such as land or housing (Bromley, 1992: 8).

A regime creates exclusivity, adumbrates and demarcates how resources can be used by whom and sets the rules as to how various actors can gain access, use, or exploit them. The institutional regime also manipulates, restricts, or enhances actors’ use interests (Gerber et al., 2018: 3). Regime types can be defined and categorized on the basis of two dimensions—extent (quantitative dimension) and coherence (qualitative dimension) (Hengstermann, 2019: 101). Extent refers to the total number of regulations that influence the different uses of a resource at a given time (e.g. energy law, housing law, etc.). The criterion of coherence depends on the level of content and connection between public policies and property rights (external coherence), but also within public policies or property rights (internal coherence) (Gerber et al., 2009: 8). The IRR analytical approach assumes that the extent and the coherence of resources use are intrinsically linked “because any increase in the number of regulations tends to generate inconsistencies. Conversely, when only a few uses are regulated, the coherence is likely to be much greater” (de Buren, 2015: 16).

Use situations in which the extent of regulations leads to internal or external incoherence are called “complex regimes”. In this situation, the majority of the goods and services provided by the resource are actually regulated, but in a way that is incoherent in part. The risk of overexploitation of resources increases. This situation corresponds to many resource regimes in liberal states because of the extensive development of largely uncoordinated policies since the 1950s (Gerber et al., 2009: 8). In contrast, a resource regime in which extent and coherence are balanced is likelier to be an “integrated” regime. Then, all goods and services produced by a resource are regulated in a coherent way, which increases the possibility that sustainable use conditions are created. The central and overarching assumption of the IRR analytical framework is that “high levels of regime extent and coherence are necessary preconditions for resources sustainability” (Gerber et al., 2009: 798). In states based on the rule of law, it is therefore necessary to perform a close analysis of the legal foundations of the legal system as well as of its functioning and characteristics to understand the institutional regime in force.

At this point, it must be noted that besides the analysis of formal institutions, the IRR also considers the impacts of informal rules such as social norms, conventions of social behavior, sanctions, or taboos. Informal institutions describe actors’ norms in a given context and the ensuing generally accepted rules-in-use (Thomann et al., 2018). Informal rules appear and thrive in the interstices left between formal rules (e.g. de Buren, 2015; Gerber et al., 2020). The IRR analytical framework assumes that informal rules, sooner or later, result in formal institutions to a greater or lesser extent (Gerber et al., 2009: 803). While in situations of informality actors do not play by the formal rules they do it against the rules and thus, indirectly acknowledge them (Gerber et al., 2009). Consequently, informal rules have a lasting impact on the ways a society conducts itself. This means that, even in “weak states”, the formal legal framework provides a strong reference that shapes individuals’ actions (Hagmann & Hoehne, 2009). In any case, formalized institutions strongly and directly influence the use interests of all relevant stakeholder groups and embody the clearest expression of social will in dealing with a resource.

In the next section, I explain in more detail these two categories of formal regulation—public policies and property rights. First, I address how they constitute the institutional regime of a resource; second, how they influence the behavior of actors involved such as owners and other user actors; and third, how incoherencies in regulations might occur that produce unsustainable outcomes.

2.2.2 Public Policies

According to Knoepfel (1986), the dialectical relationship between public policies and property rights in resource regulation can be summarized as follows: Public policies are crafted by democratically elected bodies to solve a politically defined public problem in the interest of the voting majority. Public policies are regularly revised and updated by political actors (Knoepfel & Nahrath, 2007: 24). Moreover, public policy derives from the state’s attempt to solve what it considers a public problem and is expressed in the body of laws, regulations, decisions, and actions of the government (Nicol & Knoepfel, 2008: 170). Following the IRR approach, public policy hence entails “a series of intentionally coherent decisions or activities taken or carried out by different public and sometimes private actors whose resources, institutional links and interests vary, with a view to resolving in a targeted manner a problem defined politically as collective in nature” (Knoepfel & Nahrath, 2007: 24).

This problem gives rise to the introduction of formalized acts of a more or less restrictive nature that are often aimed at modifying the behavior of target groups (social groups presumed to be at the root of or able to solve the collective problem) in the interest of the social groups who suffer the negative effects of the problem in question (final beneficiaries) (Knoepfel & Nahrath, 2007). Hence, through public policies the state receives the power to regulate the actions of those actors who are thought to be at the source of the collective problem, in the name of public interest. Public policies are regularly revised not only because the collective problem they are targeting constantly evolves, but also because changing political majorities propose alternative solutions to the problem (Knoepfel et al., 2012: 417). In daily practice, this makes it sometimes difficult to enforce public interests in a targeted manner since public policies are not as stable and resistant as private property rights (Sect. 2.2.4).

Public policies, moreover, are enshrined in public laws such as housing laws, planning laws, or building laws and regulations (Fig. 2.1). These laws (e.g. Housing Acts, Planning Laws) provide the legal framework for implementing the policies and guiding the actions of governments, individuals, or organizations involved in housing and urban development. In addition, all of them simultaneously solve a public problem (e.g. urban sprawl) and draw its legitimacy from a legal basis (e.g. constitutional article). This legal basis not only defines the public actors in charge of implementation but also provides them with a budget, personnel resources, and so on (Gerber et al., 2017: 1687).

Fig. 2.1
A chart. The city has public and private law with 4 intervention ways which are financial support, zoning, contracts, and property rights. Each has land policy instruments such as subsidies, affordable housing, urban development contracts, and public land purchase with building stock and users.

Instruments of land policy (own Figure based on Balmer & Gerber, 2017; Gerber et al., 2018: 16)

Full size image

2.2.2.1 Land Policy Instruments Steering Spatial Development

Among such public policies is “land use planning policy” (or land policy), which is about creating or alleviating scarcity of land according to politically predefined spatial development objectives (Gerber et al., 2018). Land use policies govern how land (and other resources e.g. energy) is allocated, used, and distributed in order to steer spatial development and resources use in the interest of the public (Gerber et al., 2017). As a public policy, moreover, it draws its legitimacy from a legal basis (e.g. constitutional article, land use planning law), defines the public actors in charge of implementation (e.g. planning agency), and provides them with a budget, competencies, or means of action (Viallon, 2018). Land use planning has typically developed a series of hierarchical plans (policy instruments) to control the actions of those actors, namely the landowners, whose effective behavior has been identified as leading to uncoordinated growth. More specifically, land use policy instruments (or “tools “ in the U.S. context) refer to specific institutional rules, laws, and regulations—enshrined in public law and private law (see Chapter 3.4 of this book for more details)—aiming to shape and influence land use, development, management, distribution, or allocation, etc. In their book, Instruments of Land Policy (2018), Jean-David Gerber, Thomas Hartmann, and Andreas Hengstermann provide a comprehensive overview of potential land rules in force (Fig. 2.1).

2.2.3 Property Rights—A Chronological Review

The IRR analytical approach acknowledges that besides public policies, property rights play a decisive role in the regulation of resources (for discussion, e.g. Demsetz, 1967; Jacobs & Paulsen, 2009; Steiger, 2006). In general, “property” does not describe an object such as land. Rather it is understood as a social relation that defines the property holder with respect to something of value (the benefit stream) against all others (Hallowell, 1943: 115–138). The one holding said rights has the expectation, in both the law and in practice that, those with duty will respect his or her claims.

As titleholders, property owners have the legitimate authority to act in a predetermined manner. Thus, property rights are identified as an exclusive, transferable, and legal right to the physical use of scarce resources, the returns thereon, and the alienation thereof. The authority system legitimizing this behavior can either be a central government, or it can be a local village council. The important issue is that the individuals feel compelled to comply with the institution in effect (Bromley, 1991).

In liberal states, therefore, property rights protect the individual’s interest against the (potentially absolutist) action of the state. Property rights are grounded in the Civil Code (or similar in Common Law countries) and are extremely stable over time because their definition hardly changes (Bromley, 1992: 11; Savini et al., 2015). Within the constraints of the law, the holder of a property right has the right to benefit as well as to freely and completely dispose of his or her property. For example, land or housing stock owners have (1) the right to control and make decisions about the housing stock that belongs to them; and (2) the right to obtain at least a portion of the benefits produced by the housing stock. Owners are also legally bound to fulfill certain obligations. The Code of Obligations and supplementary contracts stipulated in private law describe the obligations of the stock owners regarding, for instance, contractual obligations, the sale of buildings, rental contracts, or the relationship to tenants (Nicol & Knoepfel, 2008: 170).

Moreover, Bromley (1992: 2) distinguishes between four different property regimes that structure resources use—common, state, private, and non-property (open access). He argues that property regimes represent human artifacts reflecting instrumental origins that provide owners the legally and socially sanctioned ability to exclude certain users and to force them to go elsewhere (Bromley, 1992: 15). Consequently, particular property regimes prove to be chosen for particular purposes. For instance, concerning housing stock regulation, the importance of private property lies in the fact that the surrounding laws stipulate specific forms of tenure that enable residents’ entry or exit to/from the housing estate. Private rental, public housing, or tenant cooperatives are very different forms of ownership that include the potential for social exclusion to a greater or lesser extent (Blomquist, 2012; Wimark et al., 2019: 20).

In the following section—still subsection to 2.6—two instrumental conceptions of private property are introduced. Historically, they have followed either classic liberal or reformist tradition. Both of them acknowledge private property as the most important source of economic activity (for discussion, e.g. Meyer, 2009). In this book, this chronological review helps to understand how property rights have evolved over time and how this background explains why property owners are able to defend their interests in dense urban environments in an effective manner in contrast to other user actors, such as public authorities or tenants.

2.2.3.1 Property Rights in the Rise of Liberal Philosophy—Protection Against State Powers

During the seventeenth century in the rise of liberal philosophy, the conception of landownership was based on the idea of “private dominium” (Hobbes, 1651; Locke, 1689). It was handed down from Roman law, revived by the Napoleonic Code after the French Revolution, and subsequently spread within Europe and throughout the world, particularly through colonization. Following the principle of accession, individuals started to exercise dominion over several things they owned. They also became the owners of immovable objects such as buildings that were attached to the land (for discussion, Gerber et al., 2017: 1687). By further tightening “the bundle of rights” (Commons, 1893: 263), the accession principle played a fundamental role in making property more exclusive and rigid. The metaphor of “the bundle of the rights” conveys that property rights are to some extent decomposable into elements that secure property owners’ exclusive rights of resources use such as the Rights of Access, Rights of Withdrawal, Rights of Management, Rights of Exclusion, and the Rights of Alienation (Schlager & Ostrom, 1992: 252). These rights derive their significance from the fact that they help an owner to form those expectations that he or she can reasonably hold in dealings with others.

Specifically, in classic liberal perception, the purpose of property rights is to maximize the common good when socially integrated through the institutions of fair and free market exchange. The solution to the problem of natural monopoly is to conduct an ex ante bidding competition and award the right to serve the market to the group that tenders the best bid. Thomas Hobbes (1588–1679)—English liberal theorist and philosopher—argued that a commonwealth is only produced through privatizing competitive interests within a framework of strong state power. Private property was identified as an individual’s right that arises when they create value by mixing their labor with the land. The fruits of their labor belong to them and to them alone. Market exchange socializes that right when each individual gets back the value they have created by exchanging it against an equivalent value created by another (Hobbes, 1651). In effect, individuals maintain, extend, and socialize their private property right through value-creation and supposedly free and fair market exchange.

Like Thomas Hobbes, John Locke (1632–1704) later on believed in a natural right to life, liberty, and property. However, according to his perspective, the right to property is guaranteed to protect individuals against possible interferences—from other individuals or the government—in the private sphere. The function of property is to protect individuals’ autonomy and freedom as citizens (Locke, 1689). Property rights make the private appropriation of goods and services provided by resources possible, as long as public policies do not restrict exclusive appropriation in the name of general interests(s) (Constant, 1988). This classical economists’ notion of property rights was articulated by many other liberal theorists such as Adam Smith (1776), Thomas Malthus (1789), or David Ricardo (1812), and found its ways into the state systems of most Western modern societies (Keynes, 1936).

In sum, this classical liberal conception of property has always been very strongly linked to capitalism. The credo was and still is that human well-being can best be advanced by liberating individual and entrepreneurial freedom and skills within an institutional framework characterized by strong private property rights, unencumbered markets, and free trade (for discussion, Miller, 1978). Political sovereignty appears as a necessary evil that intervenes in and violates the pre-existing private sphere of ownership (Meyer, 2009: 104). Private property can only be infringed upon in very particular circumstances and when “fair compensation” is guaranteed (Cooter & Ulen, 2004; Hartmann & Needham, 2012). The role of the state, in turn, is to create and to preserve an institutional setting appropriate to such practices (Harvey, 2005: 2–3).

2.2.3.2 Reformist Positions—Towards a Perspective of Possession

During the 1870s, the classic liberal perception of property was questioned by those who pointed out that titleholders also have a social responsibility (Commons, 1893; Engels, 1872; Marx, 1868; Proudhon, 1840). By the early twentieth century, urban growth, affordable housing crises, and severe hygiene problems have created reform movements. These proposed that one of the missions of private property is to promote societal goals that are intrinsically associated with a social obligation for the landowners (Jacobs, 1998; Sax, 1992). In response to the acute housing crises endured by the working class in many cities at that time, Karl Marx and Friedrich Engels—two German followers of the French anarchist Pierre-Joseph Proudhon—proposed outlawing private landlordism and converting tenants’ rents into purchase payments on their dwellings (Hodkinson, 2012). This, they believed, would end the exploitative character of private property and transform the property-less tenants into a “totality of independent and free owners of dwellings” (Engels, 1872/1997: 28).

Their proposal was based on the writings of Karl Marx (1859)—German philosopher, economist, and political theorist—who observed that the use of goods and services under liberalism was shaped by a process of “commodification”. This process perpetually aims to produce surplus products in order to constantly gain a surplus in economic profit. Market forces and profitability objectives determine not only how goods and services are used, but also how they are produced, managed, and distributed (for discussion, e.g. Harloe, 1982: 40; Harvey, 2005: 166). While commodification might be advantageous for those selected few who reap the disproportionate benefits of the capital gain, the vast majority and particularly those of lower income would have little ability to capture value from this development. Commodification, therefore, would sooner or later end in economic development that is (ab)used as a source for profit extraction by a small financial elite. Those with limited financial means, however, will be pushed out and excluded from this process.

A sector in which “commodification” has become especially apparent was and still is the housing segment. According to Marx (1859), the commodification of housing relies on the assumption that the market, including the profit-maximizing rationality of investors, is the most efficient solution to guarantee housing supply for all income segments. The role played by private landowners becomes particularly relevant in this matter. Due to the protection guaranteed by private property rights, landowners are free to define the profit margin to be targeted on their parcels and to set the rents according to market prices. Hence, commodification of housing not only results in a dominance of financial actors, markets, practices, and narratives at various scales but in a structural transformation of housing supply, demand, and households itself (Aalbers, 2019: 4). It moreover leads to a general shift from housing treated by its use value to its financial value, meaning that housing is no longer considered a basic human need but rather more a commodity that must be traded or paid for in a globalized financial market (for discussion, e.g. Aalbers, 2017; Harvey, 1985; Marcuse, 2012; Rolnik, 2013; Schipper, 2014). Housing stocks, in other words, have become a lucrative investment outlet, a safe source of revenue, and a highly valued form of collateral.

Engels moreover argued that there was no such thing as a housing crisis, only a crisis of capitalism in which housing conditions formed just “one of the innumerable smaller, secondary evil” caused by the exploitation of workers by capital (Engels, 1872/1997: 18). The contradictory and uneven processes of capitalist development would, sooner or later, continue to generate housing questions at different points of the business cycle. From this observation derived one inescapable political conclusion: the only real alternative to the housing question was “to abolish altogether the exploitation and oppression of the working class by the ruling class (Engels, 1872/1997: 17) through working class revolution and expropriation of private property.

Later on, this classical Marxist orthodoxy that only a proletarian revolution would be able to solve housing challenges has sparred with less rigorous interventions. Other reformist positions aimed at reconsidering the strategic importance of state intervention or the shift towards more self-organized solutions of property in the here and now, such as small-scale cooperatives or mutual ownership (for discussion, Hodkinson, 2012). Without denying the commodity character of housing that Marx and Engels have pointed out, these reform approaches have brought to the surface the use value of housing both as an essential human activity and as a sphere of productive non-market activity.

2.2.4 Conflict Relationship Between Public Policy and Property Rights

Consequently, public policies with a spatial impact often conflict with the property owners’ freedom since their rights might be restricted (e.g. through zoning). Among these public policies, land use planning is the most obvious as it precisely aims to control how landowners use their land and the housing stock that is built in the interest of the public. However, since private property rights are strongly protected by law and are very inflexible, land use planning seems to experience difficulty in implementing democratically accepted spatial development plans on titleholders due to conflicting interests (Jacobs & Paulsen, 2009; Needham & Verhage, 1998). For example, densification efforts to curb urban sprawl prove very tricky to implement (see next paragraph). Therefore, the real spatial challenge is not so much plan making, but rather plan implementation. Without heavy state intervention such as expropriation, new housing regulations (e.g. new zoning) are only implemented when titleholders agree to undertake new developments, sell their stock or the land, or transfer their development rights (Gerber et al., 2017: 1685).

The shift towards densification in land use planning makes this conflicting relationship even more pronounced because densification inherently deals with the already built environment. Planning therefore takes place within a tight web of existing rights and duties engraved in complex institutional norms and regulations. Potential for redevelopment is often given, but the land is frequently not accessible due to the land rights secured by strongly protected property titles. In this situation, planning often fails to deal with complex private property right arrangements as most avenues of public intervention were crafted to handle simpler property rights situations on unbuilt agricultural or former industrial land. However, in a context of land scarcity, land use planning needs to cope with complex property rights situations on already built land such as intermixed parcels of different sizes, co-ownership constellations, rights to object granted to neighbors, rights of way, mosaics of easements, etc. (for discussion, e.g. Blomley, 2008, 2017; Gerber et al., 2018). More than ever, therefore, a keen understanding of the close interactions between public policy and property rights is required to effectively steer (socially) sustainable spatial development.

2.2.5 Actors’ Use Strategies

Ultimately, the IRR postulates that resources development is not only influenced by formal institutions. Moreover, actors and their appropriation strategies also play a significant role in this complex process of negotiation (Healey, 2007a, 2007b). Even though formal rules (legally) frame resource users in their activities, users can simultaneously exercise their own agency within this frame of reference in order to take advantage of the opportunities granted by those rules. In other words, formal institutions are regarded as the product of a socio-political compromise crystallizing in space and time the complex power relationships shaping resource uses. This compromise is never stable, as laws and regulations are constantly revised, remain unimplemented, and can be diverted or even hijacked by different actors involved (Gerber et al., 2020: 157). The IRR analytical framework aims to capture how these different actors use interests to evolve within a given institutional setting in order to understand how sustainable outcomes are shaped.

An actor describes “a unit that acts as a bearer of social roles with specific orientations (values, attitudes, and motivations) in a social situation. The unit of action is carried not only by individuals, but also by social structures and collectives” (Parsons, 1986 in Hillmann, 1994: 6). Hence, actors are not explicitly considered individuals. Individuals can be actors, but only if they represent interest groups or a unit with particular interests (Knoepfel et al., 2011: 60). The most common case is that actors act collectively. This includes groups of individuals who are linked by the same interests such as legal collectives (legal entities, parties, associations, unions, social groups) or social entities (e.g. an administrative unit within the city administration) (Hengstermann, 2019: 113).

On the one side, actors’ interests, ideas, and values depend on the configuration of the institutions in force. For example, landowners are in a position of power due to the protection guaranteed by private property rights. They can enact their objectives in a very targeted manner. On the other side, an actor’s behavior is itself goal-oriented and strategic (Hall & Taylor, 1996: 955). Within a given institutional setting, actors develop strategies to defend their own interests in order to achieve specific goals. For instance, within the structure of incentives produced by formal rules and norms, actors regularize or adapt their plans and actions to defend their own interests and objectives (Ostrom, 2007: 23). Consequently, an actor’s behavior may be influenced both by reference to a familiar set of moral obligations and by strategic calculation about what others will do. This brings to the forefront that institutions themselves are never stable or predetermined. On the contrary, they are the result of social practice and construction, strategic actors’ behavior, and decision-making (for discussion, e.g. Drahos, 2004; Fuys & Dohrn, 2010; Gerber et al., 2018; Hess & Ostrom, 2003) (see this chapter). Actors can either (re)activate, change, or (re)formulate existing formal rules through targeted intervention strategies in order to defend their own interests effectively.

Another way to understand the relationship between actors, institutions, and strategies is the “game-actors-play” (Scharpf, 1997) metaphor. Players (actors) play on a joint playground (arena) and move within determined rules of the game (institutions). To understand the game, its processes and outcomes, players must not only understand the rules of the game, but also the strategies of the other players. However, these strategies are not made explicit but can be read and understood through each move and decision they make. To win, players must mobilize available “policy resources” such as capital, personnel, infrastructure, information or know-how.Footnote 4 Policy resources are understood as means “actors use to assert their values and interests in different stages of the process” (Knoepfel et al., 2011: 86). The players can combine these policy resources depending on their availability and strategic background considerations. Simultaneously, they must also invest in the creation and maintenance of these policy resources to maintain or increase their availability in the long term. A rich equipment and skillful combination of policy resources by the players points to influential or powerful actors who, in principle, have a great chance to win the game (for discussion, Hengstermann, 2019: 95–108).

In general, the IRR distinguishes between regulators, owner-, and user actors each of which can guide, structure, or even determine housing use through their strategic behavior. In Chapter 3.5, the strategies employed by the actors involved in the decision-making process about residential densification are outlined in more detail.