The Contract Theory and the City Planning in Modern China

Abstract

This paper attempts to present the origin, connotation and structure of the contract theory clearly and completely in modern economics. According to the principle of contract choice, we have analyzed the function boundary of government in city planning: constructing the infrastructure, setting up the industrial clusters, planning the commercial and residential blocks and issuing of basic information, corresponding to the self employment contracts, sharecropping contracts, fixed rent contracts and information sale contracts respectively, all of which belong to the scope of master planning. The provisions in regulatory planning of commercial and residential land are the content of market-oriented sale contracts with clear price items, the government should not have a finger in this pie.