Simulations for Innovative Mechanisms for the Self-organizing City: Testing new tools for value capturing

Lead Research Organisation: University of Liverpool
Department Name: Geography and Planning

Abstract

Across Western Europe the activity of urban regeneration is now around 40 years old. From the vantage point of the present this history is best understood as one of experimentation and re-experimentation with a range of policy tools, agencies and spatial scales. To take the issue of scale as an example, the preferences of British policy makers in the 1970s for 'the local' were replaced by regions in the 1980s and early 1990s (having been earlier in vogue in the 1950s). This 'new regionalism' was followed by policy orientated towards 'cities', construed as metropolitan city-regions, in the later 1990s/early 2000s - itself redolent of analysis and policy stretching back to the 1930s. Most recently this has given way to a (new) 'new localism' post-2010 (for a historical review see, Lord and Tewdwr-Jones, 2013). Against this rapid cycling of preferences for the scale at which urban policy should be delivered we could produce a parallel history of the range of limited-life agencies created by the central state to deliver such policy (the Urban Development Corporations of the 1980s, the Regional Development Agencies of the late 1990s, the Urban Regeneration Companies of the mid-2000s being a very few indicative examples).

The overarching impression is a policy landscape characterised primarily by upheaval. Indeed the only commonality between periods is the central role played by national government as architect of the agencies themselves and the geographies to which they apply.

A genuine departure to this formula came with the Localism and Decentralism Act, 2011. Under this piece of legislation for the first time anywhere in the Western world individual citizens have been given the power to assemble into coalitions, determine the boundaries of their own neighbourhood and author a plan for that area. The resultant neighbourhood plan can cover many of the features that would historically have been the preserve of a professional planner at City Hall including, for example, the design characteristics of new development. More than this, the neighbourhood planning process can draw upon innovative funding models, some of which lie outside the traditional public or public-private financial arrangements that have been the norm in the past. Good examples in this respect include Community Land Trusts and the Community Right to Build initiative which allow private individuals to jointly acquire existing buildings identified as being of local significance or develop new ones.

The purpose of this research is twofold. Firstly it seeks to investigate this process of self-organised governance of urban policy using the explanatory framework provided by game theory; secondly it aims to contextualise findings from England within the wider setting offered by related approaches that have been pioneered in mainland Europe. Taking neighbourhood planning fora as the empirical subject for the domestic component of the research we will use a range of research methods rooted in game theory and experimental economics to explore urban planning policy designed and delivered in this self-organised manner. Fundamental questions to be addressed will include what conditions are necessary for coalitions to spontaneously form; what features promote coalition stability/instability, and; how might the use of collectivised financial instruments (such as a community land trust) encourage community-directed urban transformation. The results of this research on neighbourhood planning fora will then be added to the experience of similarly self-organised approaches to effecting urban transformation reported by partner universities in North West Europe. This international feature of the research is designed to encourage policy transfer and enhance the value of the work to policy makers.

Planned Impact

-Who will benefit from the research?
Beyond the academy the research will be of benefit to, first, the worlds of policy and practice and, second, all communities who live with the effects of planning decisions.

Fundamentally the research seeks to provide much needed independent scrutiny of new, self-organised, ways of enacting planning practice taking root across some European countries. In the context of the UK there has been no formal review commissioned by government, or any other agency, on the English experiment with Neighbourhood Planning (the Celtic nations operate their own devolved planning systems). Consequently the research will be of great interest to central government, particularly the architects of the reform agenda at the Department for Communities and Local Government. Furthermore practical empirical results will also be of great value to local governments confronted with managing a process for which there is no precedent. Finally, the work will be of direct relevance to those communities that are currently creating, or contemplating embarking upon, the production of a neighbourhood plan.

To ensure that the impact of the research is genuinely felt across these non-academic groups each participating nation within the consortium has obtained the support of a "societal partner". In the case of the UK the support of the Royal Town Planning Institute has been secured (see letter of support). The Institute will provide an invaluable connection to the worlds of planning practice and will have a formal role within the project's governance through the establishment of a cross-national steering group.

-How will they benefit from the research?
One of the outcomes of the research will be empirical evidence on the progress of neighbourhood planning: the drivers of and barriers to autonomous self-organisation, how stable/sustainable neighbourhood planning fora are brought into existence and what kind of planning policy outcomes such fora have produced. The research will, therefore, provide direct evidence to central government on what the effects of planning reform have been. Similar evidence will be indispensible to local government. As it is local government that still retains formal legal responsibility for the production of much planning documentation (such as environmental impact assessments) ensuring that community preferences as set out in a neighbourhood plan are consonant with other elements of the local authority's planning documentation is an entirely new challenge. How local government engages with communities that have been empowered to create their own plans is a question that is only pertinent in the wake of the Localism and Decentralisation Act. Finally, communities themselves, both those that are currently authoring neighbourhood plans and those yet to embark on this process will benefit from evidence of how the process might work, or not work, in other contexts.

Because the field of beneficiaries is so wide a strategy has been developed to ensure the research is as widely communicated as possible (see Pathways to Impact attachment). First, the inclusion of a societal partner that has represented UK planning for a century will prove invaluable in creating a systematic connection to practitioners and policy makers in both central and local government. This will be supplemented by articles aimed specifically at these groups in professional journals (such as Town and Country Planning and Planning magazine).

Making a connection to communities themselves will partly be achieved by the conduct of the empirical element of the research itself. However guaranteeing impact is felt across all the communities that could be engaged in neighbourhood planning is inhibited by the fact that this is not a well-defined set. However the project's publication strategy that includes the dissemination of research findings through the popular press and social media will support this aspiration.
 
Description This research has made significant progress in developing new methods in planning research. Our development/extension of methods and approach from game theory and behavioural economics is having a significant bearing on both theory and methods in planning research and the terms under which planning policy/practice is conducted.

Our research has discovered important insights into the implications of turning over activities that were previously the preserve of state actors to local citizens and businesses. These insights include the behavioural motivations behind citizen participation in planning along with the conditions under which coalitions of private actors can endure over the longer term.

All of the above has provided policy makers with much needed insights into what kind of outcomes a more devolved planning system might engender.

Some of the key findings relate to the viability of 'Land Value Capture' as a mechanism through which the proceeds of real estate development might be harnessed to support investment in infrastructure. This direct outcome of this project has underpinned a subsequent successful application to the joint JPI Urban Europe/National Science Foundation China call:

2019 - 2022 The potential of Land Value Capture to secure sustainable urban development supporting air quality enhancement. ESRC/NSFC (China). Principal Investigator for whole consortium- €1,578,754 across 6 partners (Centre National de la Recherche Scientifique (Pantheon Sorbonne), Université Paris-Est, Créteil, Radboud Univeristy, Nijmegen, Tongji University, Xi'an Jiaotong Liverpool University
Exploitation Route The grant has met its fundamental research objectives and is already having an impact on policy. This can be seen in subsequent awards and contracts such as leadership of the consortium of universities that completed Valuing Planing Obligations 2016/17 for the Ministry for Housing Communities and Local Government.

In addition the insights developed through this award have been foundational in developing a subsequent successful proposal on land value capture:

2019 - 2022 The potential of Land Value Capture to secure sustainable urban development supporting air quality enhancement. ESRC/NSFC (China). Principal Investigator for whole consortium - €1,578,754 across 6 partners (Centre National de la Recherche Scientifique (Pantheon Sorbonne), Université Paris-Est, Créteil, Radboud Univeristy, Nijmegen, Tongji University, Xi'an Jiaotong Liverpool University
Sectors Communities and Social Services/Policy,Construction,Environment,Government, Democracy and Justice

URL http://www.rtpi.org.uk/media/1562925/rtpi_research_report_11_planning_as_market_maker_november_2015.pdf
 
Description This work has had a very significant impact on policy. The work has been cited in evidence to select committee: It has also be cited extensively. Three recent citations include: Adams, D. (et al) (2016) Delivering the Value of Planning. London: RTPI. Aubrey, T. (2016) Bridging the Infrastructure Gap: Financing Infrastructure Investment to Unlock Housing. London. Centre for Progressive Capitalism. Outer London Commission (2016) Removing the Barriers to Housing Delivery. London: GLA. Taken together these findings all point to ways in which behavioural insights might drive planning reform. This ESRC-funded work is the first research council funded work to add evidence to this long-held aspiration of policy makers. Probably the most significant impact of the work funded through this project has been in relation to land value capture and the exaction of 'developer contributions' through the planning process. As a direct result of the insights developed through this ESRC-funded research the PI for this project was commissioned by the Ministry for Housing, Communities and Local Government to value 'developer contributions' - financial and in-kind benefits exacted through the planning process. This work was published in March 2018 (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/685301/Section_106_and_CIL_research_report.pdf) to coincide with a programme of planning reforms announced by the Prime Minister at the National Planning Conference. The impact of our work on this reform agenda has been further corroborated in writing by the senior civil servant at MHCLG (available on request) and our data is used in National Audit Office work on this question (https://www.nao.org.uk/report/planning-for-new-homes/). The Vice Chancellor of Liverpool University also recognised this work and its documented impact on policy through a non-consolidated award for 'exceptional performance' at the university's 2018 professorial review. In 2019 the same research group that conducted the previous work for MHCLG were re-commissioned to undertake the same exercise for 2018/19. This work which will be published in 2020 finds that policy changes made in 2018 partly in response to our work for MHCLG have subsequently translated into a growth in the value of developer contributions by £1bn and a more even geographic distribution of this funding. There is a clear point of connection between the ESRC-funded work and these two pieces of policy-relevant research which ave had a profound impact on the value and incidence of developer contributions.
First Year Of Impact 2015
Sector Communities and Social Services/Policy,Construction,Environment,Government, Democracy and Justice
Impact Types Societal,Economic,Policy & public services

 
Description Influence on developing planning policy
Geographic Reach National 
Policy Influence Type Citation in other policy documents
Impact Work associated with this grant has been cited in evidence presented to UK select committee on the role of planning policy in responding to development pressure (such as housing).
URL http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/built-environment-c...
 
Description Consultancy project for Ministry of Housing, Communities and Local Government
Amount £99,800 (GBP)
Organisation Department for Communities and Local Government 
Sector Public
Country United Kingdom
Start 04/2017 
End 01/2018
 
Description Ministry for Housing Communities and Local Government - The value and incidence of developer contributions, 2018/19
Amount £99,800 (GBP)
Funding ID N/A 
Organisation Ministry of Housing, Communities and Local Government 
Sector Public
Country United Kingdom
Start 07/2019 
End 02/2020
 
Description Royal Town Planning Institute SPIRE awards
Amount £10,000 (GBP)
Organisation Royal Town Planning Institute RTPI 
Sector Charity/Non Profit
Country United Kingdom
Start 03/2015 
End 11/2015
 
Description Collaboration with the RTPi 
Organisation Royal Town Planning Institute RTPI
Country United Kingdom 
Sector Charity/Non Profit 
PI Contribution I led a piece of research - "Putting a price on planning? A cross-national investigation into the behavioural economics of managed development" - for the RTPI. This piece of work draws directly upon the methods developed under the more wide-ranging ESRC-funded research for, "Simulations for Innovative Mechanisms for the Self-organising City: testing new tools for value capturing (SIMS City Value Capture)".
Collaborator Contribution We applied the methodology developed under the ESRC-funded work - which is reported in some forthcoming publications - to three Continental European case studies for the Royal Town Planning Institute. The research is reported in: Lord, A. D., O'Brien, P., Sturzaker, J. and Sykes, O. (2015). Planning as a "market maker": how planning is used to stimulate development in Germany, France and the Netherlands. Royal Town Planning Institute: London which is available at: http://www.rtpi.org.uk/media/1562925/rtpi_research_report_11_planning_as_market_maker_november_2015.pdf. The principal reason for undertaking this research was to develop an impact on the world of policy and practice with the 'societal partner' on this ESRC grant (the Royal Town Planning Institute). There is already evidence of this impact including evidence presented to Select Committee: http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/built-environment-committee/built-environment/written/25397.pdf
Impact Publication of research findings: http://www.rtpi.org.uk/media/1562925/rtpi_research_report_11_planning_as_market_maker_november_2015.pdf. Translation of research findings into academic paper forthcoming: Lord, A. D. and O'Brien, P. (2017) Putting a price on planning? Re-imagining planning as a market maker. Planning Theory and Practice. Evidence to select committee citing the work: http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/built-environment-committee/built-environment/written/25397.pdf
Start Year 2015
 
Description Valuing Planning Obligations 2016/17 
Organisation Department for Communities and Local Government
Country United Kingdom 
Sector Public 
PI Contribution In late 2017 I led a consortium of universities (Cambridge, Oxford, Sheffield, LSE) on a piece of work commissioned by the Department of Communities and Local Government: Valuing Planning Obligations 2016/17. This piece of work will be published by the ministry in 2018. 'Planning obligations' is the English shorthand for land value capture - the substantive focus of the JPI Urban Europe work funded by the ESRC are there is a direct connection between the methods and approach developed in this ESRC-funded research and the work that was undertaken for the ministry.'
Collaborator Contribution We worked with other universities to deliver a broad programme of work (for example, Cambridge did some qualitative case studies on local practice with respect to planning obligations).
Impact A report will be pubilshed soon; academic papers are also being prepared.
Start Year 2018
 
Description Invited Talk 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Postgraduate students
Results and Impact Dr Gu, co-investigator on this award, gave a talk on methodological developments in game theory to academics at Fudan University, China.
Year(s) Of Engagement Activity 2016
 
Description Invited talk 
Form Of Engagement Activity Participation in an open day or visit at my research institution
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Postgraduate students
Results and Impact Dr Gu, co-investigator on this award, gave a talk on methodological developments in game theory to academics at Brunel University.
Year(s) Of Engagement Activity 2017
 
Description Invited talk 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Postgraduate students
Results and Impact Dr Gu, co-investigator on this award, gave a talk on methodological developments in game theory to academics at Swansea University.
Year(s) Of Engagement Activity 2016
 
Description Invited talk 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Postgraduate students
Results and Impact Dr Gu, co-investigator on this award, gave a talk on methodological developments in game theory to academics at University of Nottingham at Ningbo.
Year(s) Of Engagement Activity 2016