What Does Development Look Like?

Hong Kong

Not everywhere will look like this

Apologies for my long silence. I was at home in Hong Kong on holiday attempting to eat a hole in the restaurant industry and drain the islands of tea. Going between the places where I work and Hong Kong is always an extreme contrast – the physical dissimilarities are jarring enough, an emblem of the extremes of material wealth that Hong Kong and, say, Zanzibar represent; but beyond this, the conceptions of what constitutes a working economy and society are different as well.

But these differences aren’t just between ‘developed’ and ‘not developed’ countries – one gets the same feeling moving between Hong Kong and London. It’s a reminder of the fact that development looks different in different places. Of course, there are characteristics that unite developed countries: higher average incomes, longer life expectancies, better education, less poverty and better prospects for employment. But the way in which these places function are different.

In England, and most of Europe, working hours are relatively short, incomes protected by legislation and unionism and living standards safeguarded by a social safety net provided or supported by the State. In specific enclaves of the economy, there is frenzied activity: the City of London (dominated by financial and legal services) operates on long hours, high volumes of transactions and isn’t the most stable of employers. But for the most part, England seems a more sedate place with a pretty good work/life balance.

Hong Kong is different. That frenzied economic activity that characterizes the City is everywhere, driven by rampant consumerism. People work insane hours, and not just the bankers and lawyers. Many of my friends there own or manage companies – they work long hours, but most of their staff do as well. Many are paid for a standard eight hour working day, but without the inducement of over-time pay or extra leave choose to stay in the office well beyond this most days to push the company’s business just a little bit further. They know their jobs are not well protected, and depend on the strength of that individual company – any edge they can provide helps safeguard their livelihood. This attitude carries over to the retail sector as well: walking down a busy street in Causeway Bay or Wan Chai and you can buy shoes, movies, stationery or handbags at midnight or later.

This isn’t an unreservedly good thing: while it’s great to be in a vibrant place that doesn’t shut down, a common complaint about Hong Kong is the poor work/life balance. People are compelled to work extremely long hours partly because the Government takes a minimalist approach to social protection and the fact that job security isn’t great, responding closely to economic conditions. Life in England isn’t completely different, but it’s at a different point in the scale of uncertainty, work/life balance and commercialism.

These observations matter for development. We take for granted that there is a vision of ‘development’ or ‘developedness’ that poor countries are striving to, but how accurate is this? There are many different paths that can be taken to the same aims of better incomes, life expectancy, health and education. These paths will lead to a different kind of economy and society, with different advantages and drawbacks. Yet, it doesn’t appear that development policy, certainly not from the donor side, takes into account the myriad approaches to development. From the developing country side, the mania for strategies, visions and plans, while well intentioned, seeks to hit specific targets rather than laying out a conception of what kind of society and economy is desired.

If we accept that developed countries have used different methods to get where they are, and that they have created economies, state structures and societies that have different sets of advantages and disadvantages, there is a case to be made that development policy should focus on individual countries. Specifically, perhaps we should be looking at how the population, state, geography etc. might best develop as a functioning economic and social structure, rather than focusing on the outcomes and outputs that these structures are supposed to achieve to merit the tag ‘developed’.

These are just thoughts. There are good reasons why we focus on incomes, health and such – these are the real experiences of people. But perhaps, in keeping with the modern obsession for measurement, we’re focusing on the wrong end of the development process.

Living Just Enough for the City? Extended Thoughts on the Charter Cities Proposal

The worst case scenario?

The worst case scenario?

Has everyone heard about Paul Romer’s Charter Cities idea yet? Chris Blattman heard him speak about it recently, announced himself interested and unconvinced – and Romer responded eloquently within a week. Aid Watch even gave him a Q&A in which to explain it all just the other day. It’s a radical concept getting a lot of press (or blog, rather).

Though the Charter City concept is sold a little bit like a home shopping network product (‘Yes – you too can create a developed state in just five easy steps’) we should not undervalue the innovative thinking it embodies. Romer wants to grow new dependent micro-states that can house the poor from less developed countries in a functional economy and service-provision unit. The thinking behind the idea can be summarized by these two quotes, both from Romer:

All it takes to grow a charter city is an unoccupied piece of land and a charter. The human, material, and financial resources needed to build a new city will follow, attracted by the chance to work together under the good rules that the charter specifies.

Sounds simple, but the devil is in the details:

The key … lies in timing. The charter comes first, then residents, investors, and employers each decide whether to come live under the rules that it specifies. Historically, the ability to vote with one’s feet has been a powerful force for progress. Charter cities offer a chance to amplify it, dramatically improving the rate at which people get access to better rules.

I’ve got a something of a personal interest in this. I come from a Charter City. At least, I think I do. I was born and raised in Hong Kong, an example that gets cited a lot when people talk about the concept though I point out below that I recognize very little of what Romer describes as ‘Hong Kong’ or her history.

He describes the One Country, Two Systems approach, in which China agreed to absorb Hong Kong without changing the Basic Law put in place by the British for 50 years as a Charter (incidentally, this is why Wong Kar-Wai’s magical sequel to In the Mood for Love was set in 2046). Of course, most Hong Kongers were emphatically not allowed to vote with their feet: the vast majority were unable to secure British citizenship and remained in Hong Kong under Chinese rule. Many who could win citizenship elsewhere voted for Vancouver.

Knowing the likelihood of my interest Matt alerted me to the idea a few months back, and I’ve been reading reactions with interest. I think the idea is profoundly and fatally flawed due to Romer’s ahistorical approach. Equally importantly, there are two major positives to the idea that should be more fully articulated and understood, so important are they. They are completely new – groundbreaking in the true sense of the word – and speak to what I see as the central problems of economic transformation.

Continue reading