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Reshaping Reshaping Economic Economic Geograph Geograph y y Policy Messages for Domestic Integration

Reshaping Economic Geography Policy Messages for Domestic Integration

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Page 1: Reshaping Economic Geography Policy Messages for Domestic Integration

Reshaping Reshaping

EconomicEconomic

GeographGeographyy

Policy Messages for Domestic Integration

Page 2: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Concentration, a fact of life,Half of the world’s production…..

Page 3: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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…at the global spatial scale…

….can fit onto 1.5% of its land, less than the size of Algeria

Page 4: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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…at the national spatial scale

Even in a small country like Belgium, production is concentrated in small areas

Page 5: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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… at the local spatial scale

Cairo produces over half of Egypt’s GDP with 0.5% of its land

Bangkok generates close to half of Thailand’s GDP with < 0.1%

of its land

Page 6: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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… similarly in Central Asia… economic landscapes are bumpy

Kazakhstan

UzbekistanKyrgyz Republic

Page 7: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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A Bumpy Economic Landscape

….. different parts of a country urbanize at different pace

…. and these areas present different policy challenges

Incipient stage urbanizationPopayan, Colombia

Intermediate stage urbanization Bucaramanga, Colombia

Advanced stage urbanization Bogota, Colombia

Orange areas denote urban settlements—Popayan, Bucaramanga, and Bogota

Page 8: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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As urbanization advances, the functions of cities change

… and they deliver different types of scale economies

Popayan, Colombia Bucaramanga, Colombia Bogota, Colombia

Page 9: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Some are at the incipientstage of urbanization

Per capita GDP Urban share

Kazakhstan US$ 5,060 57%

Turkmenistan US$ 3,000 43%

Uzbekistan US$ 730 37%

Kyrgyz Rep US$ 590 34%

Tajikistan US$ 460 25%

Page 10: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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… and face the challenge

…that rapid urbanization takes places when countries are at low-income levels

Page 11: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Incipient Urbanization Stages

• Priority Policy Instrument:

–Spatially blind institution

– universal provision of basic amenities and social services

– tax and transfer systems

– land market institutions

…in Tajikistan, Uzbekistan, & Kyrgyz Republic imply….

Page 12: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Areas at incipient urbanization stage:

Density

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WDR Conference in Central Asia, February 26-27 2009

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… about facilitating Density, building spatially blind Institutions

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WDR Conference in Central Asia, February 26-27 2009

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Land market institutions are critical

--- to facilitate agglomerations--- to encourage mobility

Spatially Blind Institutions

Page 15: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Historical and contemporaneous examples of land market institutions

Land tenure security, private property rights:• England 16th century: enclosure movement in 1500; Enclosure Act 1604• Denmark 18th century: Abolition of “villenage”: 1760 communal to private land

holding• USA 19th century: 1862 Homestead Act – the foundation of strong property rights• Cambodia 20th century: land tenure security; land registry; land administration,

conflict resolution;

Ease of land use conversion; versatile zoning law:• London: 18th --19th century: Land Enquiry Commission; 1832 Reform Acts; Land

valuation decrees; The Housing of the Working Classes Act 1890 and Cheap Trains for London Workers Bill 1890

• NYC: 19th - 20th century: 1916 zoning resolution; 1938 City Planning Commission; 1961 zoning law.

• Hong Kong 20th century: 1935 Housing Commission and Town Planning Ordinance (amended overtime); 1963 first land-use strategy “Zoning Plan;”

• USA, 1930s-40s: Wagner-Steagall Housing Act of 1937, good intra-urban public transport systems

• Sweden, 1960s-70s: Royal Housing Commission in 1945; Million Homes Programme • Korea, 1980s-90s: universal provision of basic amenities; property rights; and

subsidized credit for slum dwellers to become home owners

Page 16: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Spatially Blind Institutions

Universal provision of basic amenities and social services:

--- to generate portable assets for the population so people can move to places with economic opportunity

--- to equip every place to be ready for urbanization (industrialization)

--- to ensure comparable levels of basic living standards across areas

Page 17: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Some places are at the intermediate stage of urbanization

Per capita GDP Urban share

Kazakhstan US$ 5,060 57%

Turkmenistan US$ 3,000 43%

Uzbekistan US$ 730 37%

Kyrgyz Rep US$ 590 34%

Tajikistan US$ 460 25%

Page 18: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Areas at intermediate urbanization stage:

Density + DistanceIn addition to providing institutions to continue building density,

infrastructure is necessary to reduce distance due to congestion

Page 19: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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…promote Density & reduce Distance strengthen Institutions & invest in Infrastructure

Page 20: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Spatially blind Institutions and Spatially connective Infrastructure

• London: 18th --19th century: Land valuation decrees; underground; The Housing of the Working Classes Act 1890 and Cheap Trains for London Workers Bill 1890

• NYC: 19th - 20th century: 1916 zoning resolution; 1938 City Planning Commission; 1961 zoning law.

• Hong Kong 1930s-80s: 1935 Housing Commission and Town Planning Ordinance (amended overtime); 1963 first land-use strategy “Zoning Plan;”

• Bangkok 2000s: zoning and parking spaces; traffic demand controls

Page 21: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Territorial Development Issue:

Poverty Rate

Poverty Mass

• Main Policy Instrument: Institutions e.g., universal provision of basic and social services

• Secondary Policy Instrument: Infrastructure that connects some places to leading areas

Page 22: Reshaping Economic Geography Policy Messages for Domestic Integration

WDR Conference in Central Asia, February 26-27 2009

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Policy Response: An “I” for a “D”

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WDR Conference in Central Asia, February 26-27 2009

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APPENDIX

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WDR Conference in Central Asia, February 26-27 2009

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Leading and lagging areas…