Can A Charter City Save Honduras?

Adam Davidson explores Honduras's experimentation with economist Paul Romer's theories on the need for poor countries to build special economic development zones that essentially "start from scratch" with new legal and political systems.
May 14, 2012, 7am PDT | Jonathan Nettler | @nettsj
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Based on the belief in the economic power of well-run cities, and the crippling effects of "invidious systems (corruption, oppression of minorities, bureaucracy)" often found in poor countries, "Romer developed the idea of charter cities - economic zones founded on the land of poor countries but governed with the legal and political system of, often, rich ones." 

Honduras imported the idea in late 2010, and has implemented the concept to varying effect since then. 

"There are, of course, countless ways that this charter city could go wrong, but Romer has a point," observes Davidson. "Huge numbers of people are already moving to the world's cities, too many of which are set up to create unstable poverty. Wealthy countries spend billions per year on projects designed to reform governments, build modern utilities or teach their workers new agricultural techniques. For all the cash, there has been very little success. Sponsoring a charter city, Romer said, may be a better (and cheaper) way to help."

Over at Next American City, Greg Lindsay has a more thorough exploration of the subject.   

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Published on Tuesday, May 8, 2012 in The New York Times
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