To clarify the relationship between planning and market in the primary allocation of land resource,this paper analyzes the particularities of land resource and establishes a framework for comparing institution costs,then it explores the governance efficiency of different institutions.The result shows that compared with general resources,land resource has such features as high externality,irreversibility,heterogeneity and asset specificity,which makes the institutions of complete market,pigovian solution and coasian solution fail due to enormous institution costs.Planning institution should be employed to govern the primary allocation of land resource and it is the combination of different governance structures such as market,hierarchy and network,so planning and market are not incompatible opposites.This paper finally proposes several ways on how to break the dilemma of planning failure,such as reducing and optimizing the effect of hierarchy,strengthening the effects of market and network,restricting the government intervention,implementing elastic planning and promoting public participation.