Abstract
One of the major problems of land use planning in a market or in a mixed economy is that the use of land in urban areas is determined by two different institutions: the property market and land use planning. The property market provides a set of financial incentives for the allocation of land to the use which maximises its value, and thereby the wealth of its owners. Of course the value of property is affected also by the quality of the environment and the provision of public services but the property market has no direct means of affecting these determinants.