Categories:
Institutional Economics
Private cities are happening now for a reason. Africa, India, and China are urbanizing more rapidly than has ever occurred in human history. In Africa, the number of urban dwellers is projected to increase by nearly 400 million, in India at least 250 million will move to cities and in China more than 400 million will move to cities in just the next 20 years. Not all of these people will move to older cities, which are not always in the right places and which rarely possess anything like the right material let alone the right political infrastructure. The rising middle-class want to live in first-world cities and in many of these countries only the private sector can deliver those cities.
READER COMMENTS
Wade
Sep 12 2011 at 11:17am
And Stephenson’s next book, The Diamond Age, described the hellish life of people living in these private cities.
If you are an advocate of this (“You can have all the rights you can afford”), then I recommend you move to Singapore or Argentina or South Africa for a few years (as I did), and then, if you still have the means to return, report back to us.
Alex J.
Sep 12 2011 at 12:23pm
The people in The Diamond Age living hellish lives were doing so because they (or their parents) were hellish people. Everyone with normal values got along fine (aside from the war, but war is not exactly an innovation). Singapore is reasonably pleasant, but Argentina and South Africa are not run like the Vickies’ enclave.
Wade
Sep 12 2011 at 3:33pm
Hi, Alex.
Singapore is pleasant only if you belong to the correct tribe. So, too, for Argentina and South Africa. In each of these places, you can do pretty much whatever you want, if you are well-connected. They are places where money and connections place a person above the law. And I thought South Africa (during apartheid) was run exactly like the Vickie’s enclave.
For more on life in these places, google “vengeful majorities” Prospectmagazine, and “Amy Chua”.
With respect to your comment about the poor being hellish people, I thought that Nell’s brother, Harv, was far from being a bad person, but he was unable to rise from the low social position into which he was born. Stephenson is a dazzling writer, and I think he makes the point that the culture in which we live determines whom we can and cannot become.
Steve Sailer
Sep 12 2011 at 5:53pm
“Snow Crash,” which was obviously influenced (c.f., The Raft) by Jean Raspail’s anti-immigration classic “The Camp of the Saints,” is a dystopian novel that libertarians assume is a utopian novel.
Stephenson’s line “once the Invisible Hand has taken away all those historical inequities and smeared them out into a broad global layer of what a Pakistani brickmaker would consider to be prosperity” ought to be pretty frightening to Americans, but libertarians seem to think it sounds swell.
allan henderson
Sep 13 2011 at 1:09am
Wade describes a competitive marketplace of private cities as an order wherein ‘you can have all the rights you can afford.’ I agree, but I think this is praise, not blame: the residents of private cities will probably pay a relatively low price for relatively good rights.
1. A poor worker (who might have a hard time paying for expensive rights) has little property to insure and is not party to complex, high-stakes contractual disputes that are costly to arbitrate. The rights he needs to enforce are those that relate to his person: if someone punches him in the nose, he needs an institution that can reliably obtain damages, and thus effect deterrence.
There are all sorts of ways to set up institutions for dealing with torts in a private city. They range from systems of criminal law (where the private city developer brings charges – very reasonably – against the miscreants who are making his city dangerous) to systems of monopoly civil law (where victims file suit against tortfeasors in city courts) to systems like David Friedman’s private law. And there are also more advanced schemes and hybrid schemes that might, for example, require residents to take out liability insurance that would compensate anyone whom they might harm; dangerous and immoral men would be unable to afford such insurance and thus kept out of the city, while men of marginal character would pay a higher rate and be subject to additional scrutiny by their insurance agencies.
Given all the possible ways to deal with torts, it’s hard to believe that some of them (or some combination of them) would not prove economical and effective, such that the per annum expected value of the city’s costs for producing rights for a marginal laborer would be low enough for him to afford without too much pain.
2. Consider the case of a poor worker living in a welfare state. On net, he pays no taxes. The cost of his rights (and most other goods he receives from his state) is thus zero.
Now imagine that the quality of the rights he receives from his state is poor. In some cases, the state fails to protect him from aggression. In other cases, the state itself aggresses against him. This is not an uncommon condition. Few states provide their residents with anything like efficient enforcement of just law, and there is little prospect of this changing any time soon.
This worker then has a choice: he can remain where he is and receive poor rights at zero price, or he can move to a private city and receive good rights (and whatever other goods are produced by the private city developer) at a modest price. If he values good rights more than the opportunity cost of obtaining them – if he’d rather feel safe in his home and be free to live his life without the coercive interference of others than wear marginally nicer clothes and go to restaurants a bit more often – he’ll move to the private city.
This suggests that for the vast majority of the world’s population, rich or poor, who have not been lucky enough to live comfortably at the expense of others, moving to a private city might be a rational decision.
David Mershon
Sep 13 2011 at 10:19pm
I didn’t see The Diamond Age as being either particularly utopian or dystopian, but rather a thought experiment on morality and society in a truth-less, relativist, postmodern age. The Vickies and the other socially conservative philes seemed to lead reasonably decent lives if that’s the sort of thing that you’re into, and the poor people who lived in the leased territories were materially more comfortable but perhaps intellectually less stimulated than poor people are today. There were a bunch of other people in less socially restrictive philes that lived something like a David Brooks-esque bohemian-bourgois existence that is part hippie and part high tech. To the degree that the book has dystopian themes, I think it does so from the point of view of the Celestial Kingdom, and this is embodied in the conversation that Hackworth has with Dr. X near the end of the book.
Evan
Sep 13 2011 at 11:29pm
@Steve Sailer
I think that this quote from an interview with Stephenson probably explains how you got that impression:
I think “Snow Crash” is in general a parody of dystopias, especially cyberpunk ones, that portray a future corporatized societies with weak central governments as necessarily dreary, awful depressing places. “Snow Crash” instead shows that such places could in fact be pretty fun. The characters in it aren’t really poor, they don’t make as much money as we do, but things are cheaper for them too. In particular people who are poor in real life are often wealthy online. And market forces (the burbclaves) are able to separate people who don’t want to live together without any sort of government movement restriction policy.
I don’t see that “The Camp of Saints” is an obvious influence, concepts like the Raft could have any number of inspirations, in fact I’m tempted to say that the idea is sort of archetypical. And the revelation that
spoiler
The people in the raft were infected by a mental computer virus by a crazed corporate executive kind of makes it hard to map the Raft onto any sort of realistic idea, except maybe some bizarre form of Marxism.
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