Urban planning and the market of development rights in Italy: learning from Milan

In recent years, the influence of neoliberal principles has led to an experimental application of new market-oriented approaches in the field of urban studies, in order to achieve different objectives of public interest, from the compensation of land use restrictions to the acquisition of areas for public services. Also in Italy, the use of equalization and non-financial compensation mechanisms has been influenced by internationally consolidated models, such as the Transfer of Development Rights programs (TDR). The key issue concerns the legal autonomy of development rights from land ownership, allowing their trade in the municipal market and thus, in theory, balancing private and public benefits. The scientific debate focuses on the several opportunities, in terms of planning effectiveness and flexibility, but also envisages the risk to generate unfairness, deregulation and other speculations. The paper aims to assess the positive and negative impacts of a generalized use of TDR in the urban governance and in the real estate market, adopting a case study research method. The experience of Milan has been investigated, analyzing the municipal registry of development rights. The results highlight strengths and weaknesses of the market of development rights application, in particular the risk of encouraging real estate speculation, in the same way as financial markets. Conclusions suggest the need of a more effective integration of market-based tools in the planning and regulatory framework, avoiding that their uncontrolled use could weaken the role of public authority in the local government.