Professional Documents
Culture Documents
Expansion
Paul Romer
Cartagena, Aug. 27,2015
The Growing Demand for
Urban Floor Space
• Suppose that people in cities spend 30% of their
income on housing
2
• Rent : R$ per sq m
• F = total urban floor space in m 2
Less Developed
More Developed
Total Urban Residents
$7,000 $10,000
$7,000 $10,000
$7,000 $10,000
1955
8
$7,000
7 6
0 20 40 60 80 100
Urban Share of Population
Trend in Brazil
11
US
$10,000
10
Logarithm of GDP per capita
9
Brazil
8
$7,000
7 6
0 20 40 60 80 100
Urban Share of Population
Trend in India and Brazil
11
US
$10,000
10
Logarithm of GDP per capita
9
Brazil
India
8
$7,000
7 6
0 20 40 60 80 100
Urban Share of Population
Trend in China
11
US
$10,000
10
Logarithm of GDP per capita
China
9
Brazil
India
8
$7,000 China
7 6
0 20 40 60 80 100
Urban Share of Population
Trend in China and ROK
11
US
$10,000 ROK
10
Logarithm of GDP per capita
China
9
Brazil
India
8
$7,000
7 6
0 20 40 60 80 100
Urban Share of Population
Positive Feedback Loop
Urbanization
Formal sector
Public Private employment in
spending: spending: manufacturing
infrastructure housing
Human capital
GDP growth acquisition on
the job
Role for Government?
Urbanization Industrial
Policy
Formal sector
Public Private employment in
spending: spending: manufacturing
infrastructure housing
Human capital
GDP growth acquisition on
the job
Role for Government?
Urbanization
Formal sector
Public Private employment in
spending: spending: manufacturing
infrastructure housing
Education
Policy
Human capital
GDP growth acquisition on
the job
Role for Government?
Urbanization
Formal sector
Public Private employment in
spending: spending: manufacturing
infrastructure housing
Human capital
GDP growth acquisition on
Infrastructure First the job
Role for Government?
Public Space
Urbanization
Formal sector
Public Private employment in
spending: spending: manufacturing
infrastructure housing
Human capital
GDP growth acquisition on
the job
Public Space
• sidewalks,
• bike paths, and
• roads for buses, cars, and delivery
vehicles
• new technologies …?
Utility Corridors
• Water
• Sewer
• Electrical
• Gas
• Telecoms
• Central heating and cooling
• New uses …? subsurface transport of goods?
Amount of Public Space
• Midtown Manhattan
• 30% of land in grid
• Informal development
• not arranged as a grid
Wall Street
Pine Wall Street
42nd Street
5th Ave
Room for Buses
Room for Pedestrians
What 5th ave
looked like when
it first opened
Informal
development
next to new
construction
Shanty towns
viewed from
new high rise
apartment
building
Valledupar
Valledupar
Valledupar
Montería
Montería