Assuming away politics doesn’t work

Economist Paul Romer, best known for his work on Endogenous Growth Theory, is floating the idea of “charter cities” as a way to spur development in poor countries. Romer argues that charter cities in developing countries can help get around the political roots of poverty, such as weak adherence to the rule of law, rampant corruption, and predatory bureaucracies:

How would such a city work? Imagine that a government in a poor country set aside a piece of uninhabited land. It invites a developed country to enter into a new type of partnership, in which the developed country sets up and enforces rules specified in a charter. Citizens from the poorer country, and the rest of the world, would be free to live and work in the city that emerges…

And the new zone created need not be ruled directly from the developed partner country – residents of the charter city can administer the rules specified by their partner as long as the developed country retains the final say…

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