Measuring planning: Indicators of planning restraint and its impact on housing land supply

There has been renewed interest in the impact of planning controls on housing land supply and the housing market, and particularly in their effects on supply elasticity and the type of land and housing supplied. But incorporation of planning in econometric models of housing is hampered by the lack of readily available and easily interpretable measures of planning policy restraints. In this paper a range of quantitative and qualitative measures of planning restraint developed in the context of cross-sectional modelling of housing supply in England are examined. These indicators are assessed, first, in a priori terms, second, in terms of their interrelationships, and, third, in terms of their performance in statistical explanation of variations in a number of outcomes relating to the supply of land with planning permission for housing, new housebuilding, the share of urban land, density, and house prices. The geography of restraint in England is described and some features of the planning process affecting the transmission of policies into outcomes are discussed. The paper concludes with some observations on the use of such measures in modelling housing supply.