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Case Study


the most community-focused large city in the world”. Known as The Downtown Project, the idea is attack the problem from the bottom up with a focus on residential development,


small


businesses, education and tech start- ups. So out goes bling, glam, glitz and kitsch and in comes technology, fashion, photography, art, music and faith.


Even if you are new to the area of Town Planning and Urban Regeneration, chances are you have heard of the term “Smart City” and maybe even its near cousin “Creative Class”. Commentary on Smart Cities is still very focused on technology but the term is increasingly used to the describe the aspiration of a well designed city that works for the people who live there in the key areas of health, education and transport.


The term Creative Class


comes from a book published in 2002 by the American Urban Economist Rich Florida. The argument goes that if you build a Smart City and then fill it with the Creative Class, the magic happens.


If you have a real interest in this area, the key introductory text remains The Death and Life of Great American Cities by Jane Jacobs from 1961. Perhaps because she did not formally study Urban Planning as a discipline, her ideas were very different to what modernist planning policies were arguing for at the time. She liked to work by observation and ask questions such as: ´Why is that pavement 20ft rather than 35ft´? Her later work continued to look at growth and prosperity from a people and


La


Barceloneta is earmarked to become the Mediterranean’s prime home for super yachts


18 entrepreneurcountry


ecosystem perspective and her later work is sharply critical of development for development´s sake.


just


A more recent book from Florida is called The Great Reset. The Harvard Business Review summarised its core message that “elected officials need to get over their love affair with big renewal projects” and “steer money toward neighbourhood ventures that improve people’s lives” Key to the need for a great reset is The Property Predicament, the notion that house price rises are always and everywhere a good thing. They are not, as Robert Shiller wrote recently in FT:


“We should be hoping not for price increases, but for


prices that are


formed in markets in which all people participate with realistic expectations, prices that reflect contracts that treat everyone fairly and that reward good behaviour.”


So a house becomes somewhere for people to live and the reality that property prices fall as well as rise becomes the orthodoxy. Faced with the end of flipping as a means to get rich quick, we should see resources directed instead to the creation of the


type of disruptive high growth


firms that create employment. If like BetFair, Party Poker or Paddy Power,


these allow people to make bets then good. Just not casinos with their record of bringing street crime, money laundering and loan sharking. The only development we should incentivise is the D in R&D, something the Spanish government have chosen to cut, resulting in thousands of scientists leaving the country.


The vital importance of good policy decisions is the theme of Why Nations Fail: The Origins of Power, Prosperity, and Poverty, a recently published book by an MIT Economist and a Harvard Political Scientist. The authors write:


“Nations fail when they have extractive economic institutions, supported by extractive political institutions


that


impede and even block economic growth.”


If that is a bit wonkish try: making rich people richer in the hope they will create jobs won’t create more jobs. Inclusive governments and institutions mean prosperity, growth and sustained development; extractive governments and institutions mean poverty, privation and stagnation. So economically unproductive activity such as gambling and casinos needs to be taxed and real economy activity like education, research & development and manufacturing not crowded out.


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