Half the world now lives in a city, for the first time in history — and the intellectuals are finally catching up with that fact. There's New Yorker journalist David Owen, who points out that city living is environmentally friendly: the elevator is a far more efficient way to move people than the car. Ed Glaeser, a Harvard economist, uses a new book, The Triumph of the City, to argue that cities are the driving force of innovation and economic growth. And Black Swan author Nassim Taleb predicted recently that nation states would be supplanted by city states by 2036.
The true radical of the field, however, is Paul Romer. Both a highly influential academic economist and a successful entrepreneur, he turned down the job of chief economist of the World Bank to champion his alternative approach to ending global poverty: so-called 'charter cities'.
Charter cities are likely to be greenfield building projects, but what makes them special is the fact that the city has its own special rules. Shenzhen, China's great counterpart to Hong Kong, grew from nothing as a free-enterprise zone while the rest of the country laboured under communist-era laws. Hong Kong itself and Singapore also have their own business-friendly rules.
Where Romer has excited most controversy, however, is by suggesting that Hong Kong is a more interesting model than Shenzhen, because the rules were set by a distant power, the British. In Romer's vision, the Canadians might set up a charter city in Cuba or the Norwegians in Mauritania. The host country would invite the foreign power and would be compensated for the loss of land. The citizens would not be serfs: they would show up only if they felt the new city and the new rules suited them.
Romer emphasises the foreign hand on the tiller because he sees city-building as a business in its own right, and a business investment as expensive and long lasting as a city will require a very stable investment climate. Before you dismiss the idea as absurd, bear in mind that as I write, the government of Honduras is reported in the Wall Street Journal to be taking the concept seriously.
Another advantage of charter cities requires no echo of colonialism: look at New Songdo, a not-yet-finished conurbation very close to Seoul. It is a quasi-charter city: entirely South Korean, but the rules will be different there from elsewhere. South Korean politicians privately admit that it is attractive because businesses can be offered light-touch regulations without seeding a political storm.
Cities such as New Songdo — and, who knows, an as yet unplanned city in Honduras — are an experiment at a global scale. Some will triumph and others will fail, but if city states, or charter cities, take off, it will be an interesting century.
Tim Harford is a Financial Times columnist and author of Adapt: Why Success Always Starts With Failure (Little, Brown, £20).
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