ABSTRACT
Neighbourhoods are more than artefacts of urban scholarship. They can be detected from the train window, delineated on maps, priced by real estate agents and discriminated against by homebuyers. The fact that governments make policy for neighbourhoods and that buyers and sellers in property markets are not indifferent to their attributes means that neighbourhoods are economic entities. And yet the neighbourhood in planning theory, economic geography and urban economics remains poorly conceptualised. This chapter presents the idea of a neighbourhood as a constantly evolving institution the purpose of which is to govern joint consumption in cities. Neighbourhoods are therefore joint consumption spheres. They are also spheres of joint agreement (or contract) over the allocation rules that govern joint consumption. More formally, contracts may be thought of as emerging to create and protect rights to consume private and public goods and services (referred to as property rights from hereon). Property rights may be dejure (legal) or de facto (economic) and the former, which may be created by government or by the market and backed up by government authority, evolve to protect the latter.
