Abstract
This paper discusses the interaction between institutional-cultural forces and globalizing neo-liberal ideas in the discussion on the formulation of the draft of new Spatial Planning Act in Indonesia. Although the neo-liberal ideas cannot change the whole nature of the planning system, this paper shows that they fragment the system and conflict with the existing institutional-cultural forces. It argues that the ideas of rule of law and decentralization, as promoted by the neo-liberalism, should be encouraged in order to develop a more effective planning system in Indonesia.

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