Question

Briefly explain the idea of ‘charter cities’ as a poverty reduction approach

Answer 1

As one of the leading growth economists of our time, Romer discussed his idea for a profoundly new way to reduce poverty in the developing world: chartering new cities to create centers of growth and prosperity within developing countries. These cities let people voluntarily move to a place with rules that provide security, economic opportunity, and improved quality of life. Charter cities give leaders more options for improving governance and investors more opportunities to finance socially beneficial infrastructure projects. They also harness the forces that have been among the most successful at reducing poverty in developing countries over the past few decades.

In the United States, a charter city is a city in which the governing system is defined by the city's own charter document rather than by general law. In states where city charters are allowed by law, a city can adopt or modify its organizing charter by decision of its administration by the way established in the charter. These cities may be administered predominantly by residents or through a third-party management structure, because a charter gives a city the flexibility to choose novel types of government structure. When the administration is handled by residents or third party, they can give more concentration for the economic activities of the city. Thus poverty can be wiped off to a great extent.