How hard the fight against poverty? So tough that an entrepreneurial NYT prof setup a transparent model with a charter city, called “a Hong Kong in Honduras” by the Economist–that was quickly turned opaque, added “bad rules” and was, in essence, corrupted. (He dropped out of the project.) Sigh.
But now, Mr. Romer, an expert on economic growth, is out of his own project, tripped up by the sort of opaque decision making that his plan was supposed to change.
An internal contradiction in the theory is playing out: To set up a new city with clear new rules, you must first deal with governments that are trapped in the old ones.
“I do feel disappointed on behalf of the people I have gotten to know,” said Mr. Romer, an economist at New York University’s Stern School of Business and the director of its Urbanization Project. “The Hondurans who hoped this would be a way to escape from business as usual.”