Author: Jason
In the lead precis, the author mentions how Paul Romer – the World Bank’s new chief economist and the foremost proponent of the ideas-driven endogenous growth theory – has radically proposed the top-down development of new institutions at the city-level in order to improve living standards and reduce global poverty. Despite widespread pessimism about economic growth since the Great Recession, Romer asserts that discovering and creating new “market rules” in new cities is the ticket to future progress and prosperity. While I do see merit in Romer’s approach to create “new bureaucracies and organizations rather than attempting to incrementally change existing ones,” I am rather skeptical of his charter cities idea for several reasons.
As noted in the lead precis, the charter cities concept is easy to dismiss as anti-democratic and neo-colonial. Romer argues that organizational change is too slow and sidestepping democracy to create new “prosperity-inducing” rules and institutions is the superior option. Accordingly, he suggests that poor countries should relinquish uninhabited land to enlightened foreign governments to launch new charter cities in order to streamline new rules and bypass the long process of democratic deliberation that hinders economic development in existing cities. Romer maintains that people/workers who move to a charter city would move there by choice to seek new opportunities. And although people who move to the charter city would not necessarily be granted the right to vote, they would not be coerced to stay in the city if it didn’t suit their needs. This pseudo-utopian vision is blatantly imperial, disenfranchising, and treats the city as a whole like one big capitalist enterprise where workers have the “freedom” to voluntary leave, but have no say in any of the decisions that govern their lives. Charter Cities is basically the antithesis to the Right to the City (Harvey, 2012).
Second, Romer regularly invokes Hong Kong and Shenzhen as the paradigms for the charter city. In my opinion, the over-reliance on these two examples demonstrates how Romer is preoccupied with pushing an ideological agenda while understating the fact that the economic successes of these cities might not be transferable to places with different geographies, histories, cultures, values, and so on. For instance, Hong Kong has historical ties to the rest of Asia and a unique geographical location as a natural port, which arguably has played a key role in its success as a modern center for economic activity. Moreover, since Hong Kong and Shenzhen are both affiliated with China and actually border each other, this begs the question whether or not the charter city model is replicable or even relevant outside of that specific region.
Third, the notion of charter cities seems impractical because it disregards politics and assumes that struggling nations will voluntarily sign over land to more powerful foreign nations regardless of any established political and economic rules, cultures, values, and ways of life. Along the same lines, Elliot Scalar, professor of urban planning at Columbia University, opines, “Romer makes it sound as though setting up a charter city is like setting up a fairground. We take a clear piece of land, we turn on the bright lights, and we create this separate environment that will stand apart from everything that’s around it. I wish it were that simple” (Mallaby, 2010). In fact, plans to implement Romer’s ideal charter city in both Madagascar and Honduras have encountered strong legal and political opposition over the past decade.
Lastly, Romer’s technocratic, trickle-down approach to economic growth may improve living standards for some, but it still seems like it would ultimately uphold the same patterns and systems that have maintained and reproduced inequality and poverty in the developed world. Despite Romer’s provocative rhetoric about new rules to drive prosperity, the charter city has a very limited role for government, which primarily serves as a facilitator for the creation and expansion of markets. According to Romer, charter cities cannot abolish government because it provides necessary powers such as “the ability to jail people and impose special mechanisms of accountability to make sure that those powers are not abused” (Romer, 2015). Nonetheless, since (1) neither Hong Kong or Shenzhen has eradicated poverty, and (2) widening economic inequality has evidently plagued Hong Kong during the past decade, doesn’t this indicate that new market rules (which it seems is just another way of saying privatization and deregulation) alone do not evenly distribute wealth and that government should also play a redistributive role to ensure equitable growth and development?
While I disagree with Romer’s overall approach to economic growth, I believe that certain aspects of the charter city concept holds some merit. In particular, it seems that developing new cities with new rules and institutions has the potential to help mitigate the global migration crisis. Furthermore, the idea of experimenting in cities to influence reform in state and national governments is obviously appealing. Nevertheless, I don’t think that either of these notions can bring us closer to a more just society in reality unless the development of new cities and rules are better centered around the needs and desires of the citizenry rather than the demands of global capitalism.
External sources
Kroth, M. (2014, September 1). Under New Management. Foreign Policy.
Mallaby, S. (2010). The politically incorrect guide to ending poverty. The Atlantic.
Romer, P. (2015, April 29). Interview on Urbanization, Charter Cities and Growth Theory. paulromer.net.
Royden, D. (2015, February 9). “New Model Cities" in Honduras would hand over all power to corporations. Occupy.
Talley, I. (2016, October 24). How Paul Romer Is Already Stirring the Pot as the World Bank’s New Chief Economist. The Wall Street Journal.
In the lead precis, the author mentions how Paul Romer – the World Bank’s new chief economist and the foremost proponent of the ideas-driven endogenous growth theory – has radically proposed the top-down development of new institutions at the city-level in order to improve living standards and reduce global poverty. Despite widespread pessimism about economic growth since the Great Recession, Romer asserts that discovering and creating new “market rules” in new cities is the ticket to future progress and prosperity. While I do see merit in Romer’s approach to create “new bureaucracies and organizations rather than attempting to incrementally change existing ones,” I am rather skeptical of his charter cities idea for several reasons.
As noted in the lead precis, the charter cities concept is easy to dismiss as anti-democratic and neo-colonial. Romer argues that organizational change is too slow and sidestepping democracy to create new “prosperity-inducing” rules and institutions is the superior option. Accordingly, he suggests that poor countries should relinquish uninhabited land to enlightened foreign governments to launch new charter cities in order to streamline new rules and bypass the long process of democratic deliberation that hinders economic development in existing cities. Romer maintains that people/workers who move to a charter city would move there by choice to seek new opportunities. And although people who move to the charter city would not necessarily be granted the right to vote, they would not be coerced to stay in the city if it didn’t suit their needs. This pseudo-utopian vision is blatantly imperial, disenfranchising, and treats the city as a whole like one big capitalist enterprise where workers have the “freedom” to voluntary leave, but have no say in any of the decisions that govern their lives. Charter Cities is basically the antithesis to the Right to the City (Harvey, 2012).
Second, Romer regularly invokes Hong Kong and Shenzhen as the paradigms for the charter city. In my opinion, the over-reliance on these two examples demonstrates how Romer is preoccupied with pushing an ideological agenda while understating the fact that the economic successes of these cities might not be transferable to places with different geographies, histories, cultures, values, and so on. For instance, Hong Kong has historical ties to the rest of Asia and a unique geographical location as a natural port, which arguably has played a key role in its success as a modern center for economic activity. Moreover, since Hong Kong and Shenzhen are both affiliated with China and actually border each other, this begs the question whether or not the charter city model is replicable or even relevant outside of that specific region.
Third, the notion of charter cities seems impractical because it disregards politics and assumes that struggling nations will voluntarily sign over land to more powerful foreign nations regardless of any established political and economic rules, cultures, values, and ways of life. Along the same lines, Elliot Scalar, professor of urban planning at Columbia University, opines, “Romer makes it sound as though setting up a charter city is like setting up a fairground. We take a clear piece of land, we turn on the bright lights, and we create this separate environment that will stand apart from everything that’s around it. I wish it were that simple” (Mallaby, 2010). In fact, plans to implement Romer’s ideal charter city in both Madagascar and Honduras have encountered strong legal and political opposition over the past decade.
Lastly, Romer’s technocratic, trickle-down approach to economic growth may improve living standards for some, but it still seems like it would ultimately uphold the same patterns and systems that have maintained and reproduced inequality and poverty in the developed world. Despite Romer’s provocative rhetoric about new rules to drive prosperity, the charter city has a very limited role for government, which primarily serves as a facilitator for the creation and expansion of markets. According to Romer, charter cities cannot abolish government because it provides necessary powers such as “the ability to jail people and impose special mechanisms of accountability to make sure that those powers are not abused” (Romer, 2015). Nonetheless, since (1) neither Hong Kong or Shenzhen has eradicated poverty, and (2) widening economic inequality has evidently plagued Hong Kong during the past decade, doesn’t this indicate that new market rules (which it seems is just another way of saying privatization and deregulation) alone do not evenly distribute wealth and that government should also play a redistributive role to ensure equitable growth and development?
While I disagree with Romer’s overall approach to economic growth, I believe that certain aspects of the charter city concept holds some merit. In particular, it seems that developing new cities with new rules and institutions has the potential to help mitigate the global migration crisis. Furthermore, the idea of experimenting in cities to influence reform in state and national governments is obviously appealing. Nevertheless, I don’t think that either of these notions can bring us closer to a more just society in reality unless the development of new cities and rules are better centered around the needs and desires of the citizenry rather than the demands of global capitalism.
External sources
Kroth, M. (2014, September 1). Under New Management. Foreign Policy.
Mallaby, S. (2010). The politically incorrect guide to ending poverty. The Atlantic.
Romer, P. (2015, April 29). Interview on Urbanization, Charter Cities and Growth Theory. paulromer.net.
Royden, D. (2015, February 9). “New Model Cities" in Honduras would hand over all power to corporations. Occupy.
Talley, I. (2016, October 24). How Paul Romer Is Already Stirring the Pot as the World Bank’s New Chief Economist. The Wall Street Journal.