Friday, September 25, 2009

What does Paul Romer think of Dubai?

The economist Paul Romer is the proponent of charter cities. In a nutshell:
As you’d expect from the name, a charter city is a city governed by a charter. Sounds simple, but it’s a surprisingly powerful way to let people choose to move someplace that is well governed.
Imagine that the United States and Cuba agree to disengage by closing the military base [Guantanamo Bay] and transferring local administrative control to Canada. Canada works with Cuba to draft a charter for this special zone and promises to enforce its terms. Under this charter, a new city blossoms. It does for Cuba what Hong Kong, administered by the British, did for China; it connects Cuba to the global economy. To help the city flourish, the Canadians encourage immigration.
So what does he think of Dubai? Chris Blattman paraphrases Romer's view:
...unlike Dubai (which proves a city can be built anywhere) we’ll let the workers bring their families, have equal rights, and stay.
That's not to say Dubai is bad, it is just that it doesn't fit the model Romer has in mind. All workers come to Dubai because it offers them better opportunities than they can find at home. And I have to say, that for many of these workers the better opportunities exist because governance in Dubai is superior to governance in their home country. If better governance doesn't come to your country, go where this is better governance. Even it is temporary and you don't have equal rights.


Thursday, September 24, 2009

How does Sharjah's economy look from space?

Consider the abstract from Measuring Economic Growth from Outer Space, J. Vernon Henderson, Adam Storeygard, David N. Weil, NBER Working Paper No. 15199, Issued in July 2009:
GDP growth is often measured poorly for countries and rarely measured at all for cities. We propose a readily available proxy: satellite data on lights at night. Our statistical framework uses light growth to supplement existing income growth measures. The framework is applied to countries with the lowest quality income data, resulting in estimates of growth that differ substantially from established estimates. We then consider a longstanding debate: do increases in local agricultural productivity increase city incomes? For African cities, we find that exogenous gricultural productivity shocks (high rainfall years) have substantial effects on local urban economic activity.
All kidding aside, you could apply this framework to oil prices and economic activity in oil-rich states.

Here's an un-gated version of the paper.

More in this September 21st article in Seed Magazine:
Henderson cites the Democratic Republic of Congo as an example of where data quality is poor. According to the Penn World Table, a standard source used to measure economic growth across countries, during the period from 1992 to 2003 the country had negative GDP growth. In that same period, the satellite data shows a marked increase in nighttime light intensity, suggestive of positive growth, likely in the informal sector. Henderson says Myanmar’s numbers, on the other hand, may show political manipulation: Nocturnal lights indicate significantly lower GDP growth than that stated by the ruling military junta.

Henderson and his colleagues also used the DMSP data to examine economic activity on sub-national scales, investigating the relationship of African cities to nearby agricultural regions. They found that years of crop-boosting high rainfall in a city’s hinterlands significantly correlated with increased growth and development in the urban center as measured by artificial lighting intensity.
A NOAA team led by Chris Elvidge removes contaminating natural phenomena from the images like moonlight, cloud cover, lightning, polar auroras, and forest fires, but human choices of how buildings and streets are lit, the ways windows are shuttered, and even which variety of light bulbs are used all alter the patterns and intensity of light, adding uncertainty to any conclusions.
Of course once this becomes widely known, the Myanmars of the world may ban shutters and change the kind of outdoor lighting they use. D'oh!

Tuesday, September 08, 2009

This post is not a fake

Bill Easterly:
The cover is genuine, but Miranda Kerr was actually trying to save the koala bear and said nothing about staying naked, USAID, aid tying, or the drought. I am experimenting with this (fake) blog post /Tweet to see what would work on blogs and Twitter to promote the Aid Watch motto, “just asking that aid benefit the poor.” Based on my Twitter experience, the main ingredients behind how much Tweets “succeed” in the philanthropy area seems to be some combination of two or more of the following: (1) Sex, (2) Celebrities, (3) Outrage (moral), (4) Suffering Africans, and (5) Satire (lame attempt to come up with memorable acronym for (1) thru (6) [sic]: SCOSAS).
[M]y big worry at Aid Watch is that relying on shallow sexy celebs to promote aid leads to a shallow aid message: just spend more aid dollars with no incentives for dollars to reach the poor.

Is there some way to grab attention for good causes without selling out to our society's worship of celebrity & sex?
I'll interested to see what traffic this post generates from search engines and tweets.