HennyGe Wichers is a writer and researcher based in London. Her work traces the friction between technology and human society.
Each summer, just 30 miles northwest of Washington, D.C., the hills around Kingsbury’s Orchard sit lush and green as the first peaches of the season ripen to a golden-red blush. The air is heavy with the smell of fruit sugar, damp earth and dewy grass. At first light, Gene Kingsbury, who manages the farm with his sister Sue Ketron, moves along the rows of trees, running a hand across the fuzzy globes that bear his family name.
He first spotted the variety in the late 1990s on one of his trees. It was a natural mutation. From the few buds that caught his eye, he grafted two experimental trees, then propagated 200 more. Today, the tangy-sweet Kingsbury Pride peach ripens each August in Upper Montgomery County — a reminder that even century-old traditions rely on change by design.
The orchard along Peach Tree Road has been in the family since 1907, surviving wars, economic downturns and the long suburban march of Washington, D.C. But by the late 20th century, that legacy was in doubt — not because of a bad harvest, but a crisis of incentives. Several relatives co-owned the farm. Some wanted to cash out; others wanted to keep growing fruit even as the city encroached, Kingsbury recalled.
It’s a familiar arithmetic on the urban fringe: Farmland can suddenly be worth more than anything it grows because developers will pay for space to build. That’s often the moment communities fracture, too — preservationists go up against developers, farmers against town planners. The story typically ends in a courtroom.
But what saved the orchard was an unusual set of rules. In 1980, Montgomery County planners had created what they called the Agricultural Reserve: a 93,000-acre expanse of farmland stretching along the Potomac River, protected not by fences or subsidies but by a new kind of property right: Transferable Development Rights, or TDRs.
Landowners inside the Reserve were assigned one TDR for every five acres. They could use these rights to build on their own land or sell them to developers who wanted to add density — build more homes than otherwise allowed — in designated growth zones, miles away.
The idea gave farmers the option to raise funds without sacrificing productive land, and developers more room to build where schools, roads and sewers already existed. “We probably would have lost the farm back in the 1990s without the opportunity to sell the TDRs,” Kingsbury told me. The sale allowed relatives to “reap some monetary benefits,” giving Gene’s mother time to eventually buy them out. The Kingsburys sold their rights, not their land, and the transaction kept the farm intact — and the peaches still growing.
What happened on the Kingsbury farm looks, from the outside, like just another planning rule. But in practice, it does something subtler: it turns binary divides into a cooperative market by simply rewriting the economic incentives.
It worked. More than four decades later, the Reserve still covers almost a third of Montgomery County’s land. Its TDR market has enabled 70,000 acres to remain farmland — all via private transactions. The area’s more than 500 working farms help sustain rural livelihoods within just 25 miles of the nation’s capital.
Over the decades, the TDRs that farmers sold enabled thousands of new homes to be built exactly where the county — and its commuters — needed them. Today, the Reserve is home to more horses than people, as Royce Hanson, who designed the system, likes to put it. Many of its fields double as open spaces for cycling, horseback riding and pick-your-own produce days out for the surrounding communities.
This wasn’t a miracle of consensus or top-down diktat. It was a triumph of mechanism design: the science of designing rules that align self-interest with the collective good. What Montgomery County’s planners figured out for housing and preservation, mechanism designers now see as a general principle: If you can rewrite incentives, you can build cooperation almost anywhere.
Making Cooperation Rational
Montgomery County’s TDRs were a real-world experiment in a theory being formalized in economic journals around the very same time: what economists call mechanism design, or reverse game theory.
“If you can rewrite incentives, you can build cooperation almost anywhere.”
Traditional game theory assumes that the rules are fixed — the chessboard is set, the laws codified — and asks how rational people will behave within them. It predicts outcomes based on existing incentives. Mechanism design turns that question around: It asks, for example, what rules should we write to get a different outcome — say, preservation and housing?
The idea emerged in the 1960s and has since led to the awarding of two Nobel Prizes. One went to its intellectual forefather, economist William Vickrey, who shared the prize with the economist James A. Mirrlees in 1996. Vickrey’s work on auction design is still used today to sell everything from telecoms bandwidth to online advertising space. Another Nobel, in 2007, went to the economists Leonid Hurwicz, Eric Maskin and Roger Myerson, who laid the foundations of the field.
What united these economists was engineering. They all treated cooperation as a design challenge rather than a test of moral character or will. The idea frames progress as a structural problem and offers some optimism: Conflict isn’t inevitable. If we can make cooperation the rational choice, we shift from analyzing the game to designing it.
And that was precisely the intuition of Royce Hanson, who took charge of Montgomery County’s Planning Board in 1972, when the region was split between Democrats and Republicans, planners and landowners.
When I spoke with him last fall, Hanson appeared on Zoom from his book-lined study — neat in a dark jacket, his voice measured but quick. He has spent more than 70 years thinking about how to make cities and suburbs work. That afternoon, he’d be going to a park named after him — a fitting symmetry for a man who redrew the landscape of his county.
When he joined the Planning Board, Hanson inherited the 1964 General Plan, which aimed to channel suburban growth into compact corridors and preserve broad green wedges of farmland between them. At the time, to hold the line against sprawl, the county had restricted new housing to one per 5 acres in its lowest-density rural areas, but that wasn’t enough to stop the city from encroaching and keep farms alive.
The best the county could have done with conventional tools, Hanson told me, would have been what’s called “large-acre zoning” that restricted lots to one house every, say, 25 acres — “and that would have held for a few years. Then a new council would have come along, and under pressure from developers and landowners … let it rip.” That’s exactly what happened across the river in Fairfax County, Virginia, where the same pressure largely erased the agricultural landscape.
To avoid that same fate, Hanson had to think beyond the usual tools. Drawing on a small local experiment in Maryland that transferred development rights to the other side of a road, he realized landowners in protected areas could sell their unused development rights to developers all the way in the suburbs.
Allowing those rights to travel was the breakthrough. “It allowed protection of a critical mass of land in agricultural use, avoiding fragmentation” and “concentrating suburban and urban development in centers and corridors,” he told me.
But the real sophistication lay in the system’s political neutrality. Hanson faced a constituency deeply skeptical of regulation. “Farmers and landowners were opposed to government intervention,” Hanson said. “And, of course, what the planners wanted was some kind of government intervention — traditionally, that had been zoning.”
“What TDRs offered,” he continued, “was the argument that the government’s not going to be involved in these transactions. These are entirely private — you’re going to set the price in negotiations with somebody who wants to buy your development rights.”
The mechanism offered something for everyone, making participation the logical choice. “It’s held for 45 years,” Hanson said. He paused, then added, “You know, I think it will hold a lot longer.”
Markets That Build Coalitions
Montgomery County’s system for development rights wasn’t unique. Planners around the world have used the same logic to turn zero-sum battles into functioning markets. Variations have surfaced in cities like New York, Houston and Tokyo for the same reason: When too many stakeholders can say no, progress depends on changing what they stand to gain.
TDRs first appeared, quite literally, in the air of New York City. In 1978, the U.S. Supreme Court ruled that the city could deny permission to build a skyscraper atop Grand Central Terminal, provided that the building owners, Penn Central Transportation Co., could sell the unused “air rights” to developers, allowing them to build on adjacent plots. That decision turned empty sky into an asset, cementing air rights as tradeable property and laying the foundation for TDRs.
Since then, a free market in air rights has flourished, aligning preservation and development — and defining the city’s skyline. Churches, theaters and landmarks sell the air above them to fund their upkeep; developers snap up those rights to build ever-taller hotels, apartments and offices on neighboring blocks. The mechanism resolves the tension between New York’s need to grow and its obligation to preserve its history.
“If we can make cooperation the rational choice, we shift from analyzing the game to designing it.”
The demand for super-skinny towers in Midtown Manhattan led to a 2017 rezoning, allowing landmarks to sell their air rights to a broader area of town rather than just adjacent lots. St. Patrick’s Cathedral used the new system in 2023, selling some of its rights in a deal worth as much as $164 million to fund its maintenance. Just around the corner from the Cathedral, that sale has allowed a new 62-story, 1,600-foot office tower to rise that’s slated to become the second-tallest in New York.
In Houston, Texas, the same logic solved a different impasse: housing density versus neighborhood consent. Houston is famous for having no zoning — it’s a patchwork of warehouses, homes and strip malls where property owners can build almost anything.
But by the 1990s, the city’s rapid population growth was pushing against its own rules. A rigid 5,000-square-foot minimum lot size effectively banned townhomes, and any attempt to lower it met fierce opposition from homeowners fearing for their neighborhoods.
Yet in 1998, amid a booming economy and surging demand for inner-city housing, its planning authority implemented a sweeping reform in the city’s urban core that cut the minimum to as little as 1,400 square feet. Overnight, a single lot could fit three houses instead of one. The real innovation, however, was a local opt-out. The smaller lot size became the default, but neighborhoods could restore the old rules through a private legal agreement among neighbors or if a majority of an area’s homeowners petitioned the city. They could still be NIMBYs (an acronym for “Not In My Back Yard”), but only by giving up the right to split their own lot.
Every resident faced the same choice: What was worth more — the right to build, or the right to stop your neighbors from building? A few wealthy areas petitioned to opt out of the lot-size reform, but the vast majority of blocks agreed to it. Since then, Houston has added 80,000 homes within existing central neighborhoods, preserving affordability by building in the city’s core. Planners didn’t have to persuade NIMBYs into YIMBYs. They simply rewrote the rules so that cooperation made sense.
The same logic works at far larger scales. In Japan, the government stretched this approach across an entire metropolitan corridor. The Tsukuba Express, a 58-kilometer, 20-station rail line linking Tokyo to Tsukuba Science City, began as a sketch on a map in 1978, and stayed that way for more than a decade because of the “holdout problem.”
In infrastructure projects, the holdout problem is a planner’s worst nightmare. Each private landowner in a potential project’s area can stall its progress, but the last ones to sell end up with the most leverage and can demand the highest prices. It creates a deadlock and a waiting game; typically, nothing gets built unless the state or courts impose a solution from above.
But in 1989, Japan’s legislature tried something new. Rather than seize land, a blunt option that breeds resentment and lawsuits, it passed a special law to build the rail corridor through a system known as “land readjustment.”
Under this approach, participation was compulsory, but compensation was tied to collective success. Planners pooled, replanned and re-parceled nearly 7,200 acres of farmland and housing plots. Across the project, owners gave up around 40% of their land area, but in return, they would receive smaller, fully serviced lots near the new stations — often worth more than their original parcels — zoned for homes, shops or offices.
They could keep them, sell them or build on them. It wasn’t exactly consensus, but it wasn’t entirely expropriation either. The system forced alignment without annihilating ownership; landowners lost land area but gained value. When the Tsukuba Express opened in 2005, it paid off. The roughly $7.5-billion project became profitable in just five years, 15 years earlier than forecast. Property values along the line rose by more than 40%, landowners sharing in the gains.
Japan didn’t conjure consensus through culture or appeals to harmony — its landowners can be as stubborn as anywhere. Instead, it wrote a win-win situation into law. Had the project been privately led, the same mechanism would still apply, but a two-thirds supermajority of landowners would have needed to agree to move forward.
At this scale, mechanism design begins to resemble governance — less a method for building coalitions, more a threshold for collective action. And that threshold raises a question: Where exactly is the line between coordination and coercion?
“Every resident faced the same choice: What was worth more — the right to build, or the right to stop your neighbors from building?”
When Mechanisms Age
Japan’s solution for the Tsukuba Express qualifies as mechanism design, but only just. While the rules aligned incentives, participation was effectively compulsory: Landowners could dispute the specifics of their lots, but they couldn’t stop the train. It was cooperation, yes — but cooperation by constraint.
It is precisely this tension — between economic efficiency and human agency — that Glen Weyl, a Microsoft researcher and founder of the RadicalxChange Foundation, a nonprofit dedicated to democratic innovation and institutional design, has spent the last decade pondering.
In the 2018 book “Radical Markets,” Weyl and his co-author argue that capitalism doesn’t fail because it’s too free, but because its freedoms pool — especially with property. The right to exclude becomes a bottleneck, a small monopoly that creates the holdout problem that trapped the Tsukuba Express. His proposed solution, the Common Ownership Self-Assessed Tax (COST), imagines all property as a perpetual auction: Owners publicly declare a price, pay tax on it, and must sell it if someone meets the price.
But when we spoke last fall, Weyl was quick to say he no longer sees this kind of pure mechanism as complete. “Mechanism design,” he told me, “is based on selfish, maximizing individuals.” He believes it’s still useful because it shows that “we could invent very different ways of organizing things.” But the theory of motivation that propels it “is extremely limited.”
For Weyl, the missing piece is humanity. “People’s motivations aren’t primarily selfish, but partial,” he said. The real goal isn’t coordinating perfect self-interest but designing systems that build “relationships across the differences that divide” us.
With that insight, our earlier examples come into sharper relief. Montgomery County, New York, Houston and Tokyo weren’t triumphs of theory and tidy formulas. They worked because planners began with real communities and real loyalties. Farmers protecting inheritances; homeowners protecting neighborhoods and retirement plans; landowners negotiating loss. Mechanisms mattered — but only because they were rooted in those lived, partial motivations.
Precisely because mechanisms reside within human motivation, they drift, get hacked and inherit the politics of the moment that created them. In 2021, the U.S. had 375 TDR programs, but Rick Pruetz, co-author of “The TDR Handbook,” told me as many as a third have never been used. Some communities liked the idea but faced no developer demand; in others, sellers set prices so high that no buyers were ever interested. A mechanism that doesn’t solve a problem is a symbol, not a tool.
Even Montgomery County’s celebrated system proved vulnerable to change over time. Developers could, until recently, increase density by adding amenities — structured parking, transit proximity — and bypass the TDR market entirely. When actors can go around a mechanism, it no longer coordinates anything. In January, the county’s rules were updated so that developers must now contribute to a fund that purchases TDRs and provide amenities tied to broader county priorities, effectively closing the bypass route, according to Chris Peifer, a spokesman for the Montgomery County Planning Department.
Other flaws have surfaced slowly, like hairline cracks. Hanson, the planner who designed the system, told me the Reserve’s original rules created a “perverse incentive.” Landowners could keep one TDR and use it to build one house on a 25-acre parcel. It was meant to support generational farming, but by the 2000s, those parcels had become magnets for luxury mansions. After a 25-year break, Hanson returned to Montgomery Planning to fix the problem — offering landowners compensation to permanently extinguish their right to build on those large parcels, closing the loophole for good. Mechanisms age. They need pruning.
Legal scholars Roderick M Hills Jr. and David Schleicher have argued that TDRs fail as “a technocratic tool” for land use but succeed as a “political tool” for breaking NIMBY opposition by “building a competing pro-growth coalition.” Weyl sees the same thing. The designer’s job, he told me, isn’t just to align individual incentives but to “find a way and orient things to encourage them to establish relationships across the differences that currently divide them.”
If it fails to do that, mechanisms risk becoming a trap. Design is ultimately a technology of implementation, not morality. It optimizes for whatever outcome the rules specify. In the hands of a benevolent planner, it preserves farmland; in the hands of a bad actor, it optimizes for exclusion. The math solves the incentives problem, but ignores the power problem: Who gets to set the goal? If the initial distribution of rights is unjust, an efficient mechanism simply crystallizes that injustice into a market.
That is why the architecture itself must be visible. Without transparency, Weyl warned, incentive systems can be “fundamentally deceiving.” Top-down mechanisms, mechanisms that hide their logic, do not build cooperation or trust. They erode it.
Ultimately, mechanism design is also the architecture of politics. Mechanisms require maintenance, disclosure and adaptation — just like the communities they serve. And it’s toward that kind of flexibility that the next wave of design is now turning.
“Precisely because mechanisms reside within human motivation, they drift, get hacked and inherit the politics of the moment that created them.”
Designing For Plurality
The most successful mechanisms created space for people with different loyalties, interests and identities to cooperate on their own terms. That’s the terrain Weyl wants designers to pay attention to now — not idealized preference curves, but the messy social motivations people bring to public life.
Weyl’s latest project, “Plurality,” builds on work he’s done as cofounder of The Plurality Institute, a nonprofit that focuses on developing “plural” technologies that “upgrade democracy and support human cooperation at scale.” The new project is foremost a book developed with Audrey Tang, formerly Taiwan’s first Digital Minister, written through an open-source process that practices the same participatory principles it champions — that extends the logic of mechanism design into another arena where divides run deep: democracy. Here, the goal is to redesign voice — how people express themselves and how those expressions aggregate into power and influence.
Democracy today suffers from a problem of fidelity. In a simple vote, one person’s mild preference counts the same as another’s deepest conviction. It’s a blunt instrument flattening passion. To capture that lost signal, mechanisms like Quadratic Voting (QV) and Quadratic Funding (QF) build on the intuition that people don’t just have opinions; they have them with varying intensities.
Quadratic voting tries to refine the arithmetic. It provides citizens with a budget of “voice credits” to allocate across issues, allowing them to spend more on what matters most to them. But the cost is quadratic: Casting one vote on an issue costs one credit, casting two costs four, and casting 10 costs 100. The mathematical rule turns conviction into a trade-off: passion has a price, and so does indifference.
Imagine applying this logic in the built environment. In nearly every city, planning hearings collapse into binary choices: Build or don’t build. The loudest voices — often a small, entrenched minority — tend to monopolize the debate, creating a false impression that everyone feels the same.
But using QV lets locals express the strength of their preferences with voice credits. A community might collectively vote to accept higher density on a main road (spending few credits to oppose it) in exchange for preserving the park (spending many credits to protect it). Or they might allocate credits to amenities that make growth beneficial — a library or bicycle lanes. QV would surface what a simple vote doesn’t: that most communities are neither as opposed nor as united as the loudest voices suggest.
Governments are already moving from theory to practice. Since 2019, the Colorado State Legislature has used QV to set its internal budget priorities, capturing nuances that standard voting misses — though the experiment ended in 2024 when a court ruled the anonymous process violated the state’s open meetings law. Across the Pacific, Taiwan’s Presidential Hackathon uses QV as part of its process for letting citizens choose which of the submitted civic-tech proposals will receive backing. In both cases, the mechanism helps turn agenda-setting into a dialogue rather than a tally of factions.
The logic extends to money through quadratic funding. Traditional philanthropy often amplifies the interests of the wealthiest donors, but QF amplifies widespread support. A government or foundation pools matching funds and allocates them based on the number of unique contributors a project receives rather than just the total raised, turning strong social signals into financial power. So 1,000 people giving $10 each can unlock much more in matching funds than one person giving $10,000. The system has already distributed tens of millions of dollars through platforms like Gitcoin, helping fund projects that support open-source software, climate solutions and civic technology.
Mechanisms are also making their way into the governance models for digital systems and AI. Social media algorithms at times maximize engagement by maximizing conflict, but a new class of “bridging algorithms” — like X’s Community Notes or Taiwan’s use of Polis — flips the incentive. They surface agreement and boost content rated as helpful by people who usually disagree, rewarding bridge-building over polarization.
In 2023, Anthropic and the Collective Intelligence Project, a nonprofit research hub, ran an experiment in crowd-sourcing a constitution for large language models using Polis, asking a sampling of citizens to define the values chatbots should serve — a proof of concept for what plural, democratically shaped AI governance could look like, as Taiwan has already been using to some degree for about a decade. We can imagine going further still: using QV to choose which AI principles matter most, or QF to support open-source models as digital public goods, and encode those values into the systems themselves.
“Standard markets value scarcity, but these mechanisms value plurality.”
Standard markets value scarcity, but these mechanisms value plurality. They reward us, literally and algorithmically, for collaborating with people who are different from us.
Still, Weyl stressed to me that these tools are not a panacea. Their significance lies in what they reveal: Institutions are provisional, adjustable and generally capable of redesign. The design challenge here mirrors the one in land-use. Mechanisms must be rational and rewarding for diverse communities to cooperate. And if we accept that our rules can be rewritten, the new question becomes: Where do we need to apply this logic next?
The Architecture Ahead
The stakes for this kind of design are rising. As the climate crisis accelerates, we will face coordination problems that dwarf our existing housing shortages. We will not only need to decide where to build but also where to retreat.
Coastal communities from Florida to Bangladesh will face the holdout problem on a planetary scale as sea levels rise. How do you move a town? If the government buys out homeowners one by one, the community breaks. The first to leave damages the social fabric for those who stay; the last to stay is living in a ghost town.
Mechanism design offers a third way. Instead of individual buyouts, a community could vote to move collectively, perhaps using a supermajority threshold like in Japan. If the threshold is met, the whole community moves together, as happened with the Alaskan native village Mertarvik, preserving the social capital that makes a town more than just a collection of houses: the neighbors, the networks, the schools.
By coupling this with TDRs, a coastal town could, in the future, transfer its collective right to grow to an inland community, perhaps by transferring development rights and its people together. The inland town gains density and tax base; the coastal town gains the funding to rebuild together on higher ground.
This is the promise of mechanism design: It suggests our hardest problems — from housing shortages to climate retreat to democratic trust and technology — won’t be solved by better attitudes or more flexible positions. They will be solved by better architectures, by structures that treat division not as an obstacle to eliminate but as material to consider when building.
At Kingsbury’s Orchard, the namesake peaches still ripen every August — not because time stood still, but because the rules around the farm changed just enough to let the family change with it. That same lesson runs through Montgomery County’s Agricultural Reserve, New York’s skyline, Houston’s backyards, Tokyo’s commuter towns and Taiwan’s civic hackathons.
The real question now — for housing authorities, governments, AI labs and climate planners alike — is whether they are willing to treat their rulebooks as design spaces, rather than lists of constraints. In an era often defined by fragmentation and deadlock, that might be the most promising way to truly move forward.
Correction: On March 27, 2026, this essay was edited to make clear that the Montgomery County Planning Department updated its rules in January so that developers can no longer bypass the TDR market.
