Paul Romer has posted an important blog post on the urbanization process. In the case of the nation of Colombia, he seeks to help the leaders of this urbanizing nation to create the necessary conditions to have productive and "livable" future cities. Rather than embracing a "Soviet Style" deterministic plan, he advocates setting up rules of the game that permit many development paths as individual cities discover their industrial comparative advantage and the needs and desires of their growing urban middle class.Here is a direct quote:Q: What do you think are the items that a “quality city” should have?Romer quote "In the beginning, all you can do is make an allocation of public space. But a quality city needs a substantial amount of public space if it is eventually to support high density. For example, in mid-town Manhattan, the roads and the sidewalks alone take up about 30% of the surface area of the land. This was the allocation that was specified in the plan that drawn up in 1811, when what is now mid-town was rural farm area. Informal development will typically devote far less land than this for mobility. And remember, in 1811, when this plan was drawn up, people had no idea how we would be using this land today. They did not know what a bicycle was, much less what a bus or car was. But they knew that in the future, this generous allocation of public space would give the city the flexibility to take advantage of new opportunities."Do you see the implicit discussion of "option value" here. In a world with countless unknowns, where we know that we will learn about our changing environment, only a fool locks himself into a pre-determined path.MORE from Paul RomerHow should the cities confront the fast urban population growth and the continuous industrial and business development?There is great wisdom in the general advice that economists give: let the market guide most decisions. The important exception is that only a government can establish the division between urban public space and urban private land. The difficulty arises because the only affordable way to get this allocation right is to do it before urban development takes place. It is economically expensive to try to do what Haussmann did in Paris under Napoleon III, destroy many buildings and create new public space. Politically, I suspect that this kind of reallocation will never again be feasible. If a city gets the allocation of public and private space right, then the market can guide the development of urban floor-space for housing, industrial, and commercial use. In the beginning the process may look messy. Manhattan had shantytowns and informal development as it grew. But over time, the buildings can change. What won’t change is the quantity of public space.What is the Urbanization Project proposal for developing cities with quality and long-term outlook?We tell officials in rapidly growing cities that they have to set aside now the public space in the area where the city is likely to expand. To stay ahead of rapid growth, the city needs to look far into the future. We encourage cities today to plan for the expansion that will take place between now and 2050 under a fast growth scenario. If the city is growing rapidly, this can require a plan that could accommodate a 10-fold increase in the city’s built area. The land can continue to be farmed until the expansion comes. If there is less growth and the city does not need all this land for urban expansion, there is virtually no cost to having planned for too much. In contrast, if a city does not plan for enough and it suffers from disorganized informal development, the cost is very high.This is fascinating stuff and I much prefer engaging on this subject matter rather than rehashing the recent economic growth debates. Urban economists who seek to work on Romer's Agenda must think harder about what are the theory and empirical questions that need to be answered.Here let me pose a couple;1. As Paul Romer presents his ideas to urban leaders, which urban leaders want to hear these ideas? Ideally, such a selection equation could be estimated. Do younger , more educated leaders want to engage with Romer? Are those with a "free market" perspective more likely to do so? Which mayors in the developing world are willing to experiment with new ideas and why?2. If in a nation such as Colombia a few cities listen to Paul Romer and improve their public goods, will these cities grow faster in the medium term or will their populations swell as the rural poor increasingly move there? In an open system of cities featuring easy within nation migration, if a subset is well governed while others are not, do the incumbent land owners gain or lose?3. For urbanites in LDCs, what are their key local quality of life desires? Health care, good nutrition, employment, education for their kids? Street safety? How does the urbanization process affect each of these? One pathway would be that urbanization raises incomes and higher incomes permit (through Engel curve consumption paths) the ability to improve one's quality of life along all of the dimensions I just listed.4. As urbanization takes place in LDC cities, does income inequality rise or fall? One could imagine a "great compression" similar to Goldin and Margo's findings for the U.S in the 1950s as the manufacturing sector's growth helps the less educated. If income inequality increases, does this raise civic unrest? Have improvements in policing (due to information technology) helped to mitigate the challenge of urbanization and crime in the developing world?5. Do mayors learn in networks? Which mayors learn from the experience of which other cities? When Mike Bloomberg experimented in NYC, which mayors were watching and imitated his "good ideas"? Or, is it the case that it takes so long for a field experiment to be implemented and then be evaluated that mayors stop paying attention?