Paul Romer proposes that developing countries could invite instant Hong Kongs—new cities in new locations run by experienced governments such as Canada or Finland. They would enrich the country where they are built as special economic zones while also rewarding the distant government that makes the investment of building the new city state and installing a set of fair and productive rules. Over time, as with Hong Kong, the new city is turned over to the host country.HT Mark Thoma. I don't really know what to say. Dr. Thoma didn't offer any comments either. Just off the cuff, my first take is mostly disappointment. This is yet another top-down approach that does nothing to build institutional capacity in the host country and offers little in the way of fostering entrepreneurship. But perhaps I am missing something.
Thursday, May 21, 2009
New Hong Kongs
Apparently this is Paul Romer's latest idea, via Unsettling Economics: