Charter Cities Attempt to Reduce Poverty by Providing Options
NYU development economist Paul Romer has pioneered what may be the latest, and perhaps craziest, idea in this trend. What if we provide individuals with greater means to select which government they live under?
His idea is for poor countries to set aside a portion of unoccupied land big enough to build a “charter city.” Charter cities would grow to approximately 10 million and operate largely under their own laws without interference from any other government.
According to Romer, charter cities would have two positive effects:
First, they would provide the poor with options. Currently, if people live in countries that are corrupt or just plain poorly governed, they have few alternatives. Most countries that could offer them a better life, frankly, don’t want them. Charter cities would have an explicit aim of attracting poor people from the area and implementing a world-class government.
Second, Romer says that the cities would motivate other governments in the region to improve. Because people in the area would have more choice concerning which government to live under, corrupt governments or governments that don’t respect human rights would need to change to prevent losing too many residents to charter cities. Also, those governments could learn from what works in the charter cities and implement their own reforms based on that knowledge.
Cities like this have popped up in the past. One example is Hong Kong, which provided an opportunity for many mainland Chinese to escape the cultural revolution in the 1960s (in which over 20 million people died). Under its British government, Hong Kong unleashed tremendous prosperity in an impoverished region.
Unlike Hong Kong, Romer’s charter cities would not be taken by force and colonized by England. Nevertheless, many critics are still concerned that the cities would impose too much of an outside, Western influence on the developing countries because they would likely be modeled after wealthier nations in the West.
Romer counters that impoverished people should have the ability to live under governments based on principles that have proven successful elsewhere, and that everyone who lives in them will do so voluntarily.
The biggest challenge, of course, may be finding a nation that will agree to cede sovereignty over a portion of its land, even if only for a limited period of time.