Jane Jacobs (1916-2006) was a writer, thinker and activist. I first became aware of her work in a mathematical economics class taught by Robert E. Lucas Jr. at the University of Chicago in 1975. Her field observations of economic life in the big cities were briefly mentioned as illustrations for his highly abstract paper “On the Size Distribution of Business Firms”. Little did I realize, and I am not even sure that Lucas himself realized then, that her ideas would inspire and form an important part of the story of the new economic growth theory a decade later.
Her work challenged and changed the way people would view cities forever. With her powers of observation, intelligence, and common sense she captured social processes in ways that are fresh and inspiring. This article is about her work from which we can draw some lessons for Hong Kong and other East Asia cities. My article next week will explore what the new economic growth theory has learned from her work.
The Street is the Essential Public Space
Jane Jacobs was born in the coal town of Scranton, Pennsylvania. She received nothing more than a high school diploma (although she took an eclectic collection of courses at college), migrated to Toronto and became a Canadian citizen to save her sons from being drafted into the Vietnam War. She was arrested for rioting and faced criminal charges for disrupting a public meeting on the construction of an expressway that would have sliced through Lower Manhattan, in 1968. That battle pitted Jacobs in an epic uphill fight against the autocratic and immensely powerful master-builder of the era, Robert Moses, New York City’s urban planner. The expressway’s opponents were eventually victorious.
Her book, The Death and Life of Great American Cities, written in 1961, is an indictment of pretty much everything about American cities (particularly New York) in the late 1950s and 1960s. She railed against the received wisdom of the period’s urban planners which promoted rigid master zoning plans and called for bulldozing slums, opening up city spaces, and resettling the displaced in either “skyscrapers in a park”, in the style of Le Corboisieur, or in self-contained communities surrounded by a green-belt, in the tradition of Sir Ebenezer Howard’s “garden city”. Hong Kong’s public housing estates from the MacLehose era were a direct descendent of this mindset.
Jacobs digs into what makes a city work, or not work, based on an analysis of day-to-day street life, and studies of a wide variety of American neighborhoods. She accuses the planners of being ignorant of how they actually function; for having concocted theories about how cities ought to function and applied these theories in destructive ways under the guise of urban renewal. The “radiant city” proponents who proposed skyscrapers in parks and the “decentralists” who championed urban sprawl are really one and the same. Both miss the point of vibrant city life and are focused only on building fortresses to house strangers.
For Jacobs the street is the essential public space in a city. Heavy use at all hours creates “eyes on the street,” which are crucial to providing safety and cleanliness. Street-level businesses work better if they have a diverse clientele from different sources throughout the day. Small parks can benefit an already vibrant neighborhood, but they must fit their context. A lively street also allows for a healthy level of informal human contact, balancing between the need for privacy and the need for community. The district itself becomes a magnet drawing people from beyond the neighborhood to enjoy the available attractions. For this reason, Jacobs was scathing about the cultural precincts that many second tier cities build to prove their cultural credentials, precincts which are in use only while a show is on, but otherwise stand as ghostly shells devoid of life.
Her major theses for a city to work are four inter-connected principles:
1. The need for mixed primary uses. A district, or street, must serve several primary functions. Putting residential, commercial, office, small industrial and public uses within close proximity will create symbiotic relationships and increase the life of a city. The streets will be busy throughout the day.
2. The need for short blocks. Shorter blocks promote the circulatory flow of a city and protect streets from becoming dead zones.
3. The need for aged buildings. Older buildings and those with different conditions, use and rentals should be mixed with the new. These not only connect with history and provide character, but they are generally cheaper to rent or buy. This allows a broader range of businesses and housing to co-exist.
4. The need for population density. A critical mass of population concentration is necessary to support a cultural and economic life. Density has been confused with overcrowding. Different physical environments are designed to accommodate different densities of living, and overcrowding occurs if the number of people outweighs the physical facilities. This confusion between the two has prompted the creation of “in-between” densities that are neither suitable for suburban nor urban use.
Zoning Ends Vibrancy
Jacobs’ work led to a new appreciation of why a diverse mix of uses does not lead to chaos, but to a more developed form of order. What she advocated was organized complexity, rather than either simplicity or disorganized complexity. Our own city provides a good example of this in Wanchai district where the imposed simplicity north of Connaught Road stands in stark contrast to the spontaneous diversity south of it. Well-functioning urban areas spring from human action not human design. Perhaps Jacobs’s greatest contribution is her view that it is precisely the diversity and occasional anarchy of great cities that makes them great; diversity should be encouraged rather than being tidied away by zoning regulations that pay little regard to the consequences.
But diverse urban areas are not immune to failure. Indeed their very success can sound their death knell. When people and businesses are drawn to these areas there is a natural willingness to continue growing which, left unchecked will ultimately quash the originality and diversity that once made it so attractive. A sound approach would be to increase the supply of vibrant neighborhoods, although one can also attempt to zone for diversity. The problem with the latter approach is that any form of zoning is inherently rigid. One of the obstacles to changing the use of industrial buildings after manufacturing moved beyond Hong Kong was the zoning restrictions that changed too slowly to support a vibrant local economy.
Cataclysmic change can also disrupt city life. Slums are places where people move in or out before establishing roots and taking pride in their residence. Government projects intended to replace slums have even more devastating consequences, uprooting entire communities and placing them in dull single-use environments. The gentrification of slum areas occurs gradually as people who can afford to move out choose to stay. For Jacobs gradualism figures heavily in her ideals. High profile architectural projects, or large-scale policy endeavors, may purport to follow her principles, but they are apt to fail on because they introduce cataclysmic changes. They also fail to mix the new with the old.
One of Jacobs’s keys for a successful city is a mix of building ages. Although new buildings are usually more sought after than older ones, but urban renewal initiatives that levels an entire city section and replaces it with brand new buildings is doomed to failure. There is an obvious reason for this: new buildings are more expensive to rent, making them unaffordable to nearly all fledgling businesses. This form of urban renewal therefore stifles the emergence of new businesses, resulting in the starvation of growth and the choking of the local economy.
Public housing projects were very much in style everywhere from the 1950s and 1960s, and those projects were largely income sorted. In other words housing would be built specifically for lower income people with subsidies provided. But income sorting tends to encourage insular neighborhoods; the labeling effect creates a polarizing perception of ‘us versus them’ that reduces cross-traffic and sources of diversity, and ultimately leads to fewer retail businesses as they thrive in a diverse environment that crosses income divides. This type of housing frequently had an income cap so those who became successful were forced to move out (in Hong Kong there is the option of paying double rent). Jacobs’s simple and cogent point is that successful neighborhoods are ones that win the loyalty of their residents making them want to stay and improve their environment rather than move on at the first opportunity. For other reasons, I have suggested in the previous two articles of this Journal that Hong Kong should adopt policies that help these households become true homeowners by setting the unpaid discounted premium on HOS and TPS units at the level of the original sale price. There is now an additional reason to do so in that those who choose to stay will contribute to community building and those who choose to move will contribute the same in a different neighborhood.
Urban development in big vibrant cities undergoes continual change and must be open to evolving along with the ebb and flow of city life. It must not be welded to rigid planning rules and norms. Jacobs believed that some of our popular conceptions of ideal urban planning, like zoning and sorting of housing by income, are not only wrong but actively destructive to large cities. Planners have failed to see their cities in this light and have failed to consider the subtleties of the knowledge possessed only by individuals living at the neighborhood level.
Jacobs’s work has convinced us that state-driven urban planning has failed. But the externality effects from urban development cannot be easily resolved by relying purely on voluntary market exchanges. There are very high transactions costs resulting from strategic hold out behavior. Jacobs’s conception of cities as problems of organized complexity entails dealing simultaneously with a sizeable number of factors that are interrelated to make an organic whole. And this call for a different approach to decision-making – one that emphasizes processes and not merely outcomes, reasons inductively and not just deductively, and looks for telling clues rather than only generalizations.
Approaching urban development as a process where many diverse stakeholders have an interest requires us to engage the community and its stakeholders directly and simultaneously. This is the only approach that holds a better prospect of finding the right choices for all. Professor Elinor Ostrom, Noble Laureate in Economics 2009, has grappled with a class of policy issues that are not easily resolved by either the state or the market alone. Ostrom’s work on understanding how individuals devise a range of voluntary, collective interactions that over time evolve into efficient and equitable rules that manage the use of common resources may provide a better model for decision making. The recent flat-for-flat proposal by the Urban Renewal Authority and the introduction of interim decanting arrangements are innovative examples institutional innovations that would preserve and enhance diversity not only in the selected areas for urban redevelopment, but may even have spillover effects that go beyond them.
East-Asian Cities Avoid the Soviet Calamity
I learned about Soviet urban planning on a trip to Moscow in September 1990. After landing at the airport our entire delegation was taken to the guest house of the USSR Academy of Sciences. The trip was almost two hours by coach. As we left the city center and moved to the outskirts we were driven through endless rectangular street blocks of about 100 meters squared that were entirely empty except for one high rise residential building at the center of the block. By my rough estimate it could not have occupied more than one-tenth of the area in a block. This vast empty space with equidistant blocks was clearly the result of state planning. The inhabitants of these residential units had absolutely no reason to leave home after returning from work; in short, there was nowhere for them to go. And since most nights in Moscow are probably freezing cold there was even less reason to take a stroll outside.
Aleksandr Solzhenitsyn’s Gulag Archipelago immediately leapt into mind and I imagined a scene of individuals wasting themselves on vodka night after night. I also recalled Jacobs’s criticism of planner Ebenezer Howard’s scheme of self-sufficient small towns: “Really very nice towns if you were docile and had no plans of your own and did not mind spending your life among others with no plans of their own. As in all Utopias, the right to have plans of any significance belonged only to the planners in charge.”
Cities in East Asia have avoided the Soviet calamity but they have not found an efficient and equitable alternative. This became evident on a trip to Taipei in 1999. Surveying the city from the top-floor balcony of the newly-built Far Eastern Plaza Hotel, I noticed that Taipei’s skyscrapers were randomly strewn across the city with no decipherable logic. In most cities I have visited in Australia, Europe, North and South America the skyscrapers tend to be located in the city center. Why is this so? Taipei is not alone. Based on my recollection, the high rises in most major East Asian cities seem to be strewn all over the place. This repeats a common pattern witnessed in many Mainland cities, including Beijing and Shanghai.
Economic logic suggests that it would make sense to build the first skyscraper in the part of the city where land values are highest. When this happens the city center is confirmed. Subsequent skyscrapers would be built in close proximity to the first one as land values in that area will continue to escalate. This is of course the well-known rent gradient. Land rent is highest in the city center and descends in an outward ripple. The puzzle is why, with the exception of Hong Kong and Singapore, isn’t this evident in the rest of East Asia?
Wake Those Who are Asleep
I believe rapid economic growth in East Asia has placed huge pressures on land resources in the main economic cities. These were often old capitals that had expanded over time. Land ownership rights were established based on rules from an older regime, long before rapid economic growth occurred. Development rights, planning rules, and the institutions for their administration could not adapt fast enough to meet the demands of new development while also meeting the standards of efficiency and equity in allocating development rights and making appropriate compensation. Powerful political interests probably prevented the most logical choice from being approved. The ones that were approved made political logic only. They just happened to be different from any sensible economic logic and did not meet the needs of a rapidly-growing city. Skyscrapers popping up all over the city are a sign of policy failure.
Planners and powerful interests were taking on projects hugely damaging to the future of these cities. Neighborhoods were destroyed. Cities were growing without a central business district. There was rampant random development all over the place making it impossible to put in place any sensible transportation system. Despite this rapid development the inefficiencies and inequities simply piled up. I have been told that in many of these major cities a business client is often stuck in traffic for hours going from one skyscraper to another and frequently failing to complete two appointments in a day. Many Chairmen and CEOs simply do not show up at their offices, but choose to meet at the golf course instead.
Urban development in Hong Kong successfully avoided randomly strewn skyscrapers. This is very fortunate and has gone a long way towards making Hong Kong one of Asia’s leading international business and financial centers. But the city’s rigid adherence to zoning restrictions is slowing the process of urban redevelopment and choking the emergence of the new businesses that are necessary to fill the void left by manufacturing. The vitality and mobility of half the population is compromised as a result of being landlocked in subsidized housing that they do not own and in neighborhoods to which many do not feel committed.
When half the city has fallen asleep and is no longer linked to the rest, the circular flows slow down and move less smoothly, and society inevitably becomes divided. Jacobs would have us rejuvenate those parts of our city that have dozed off and reconnect them with the rest. Her name has sometimes been associated with leftist intellectuals who decry the rise of suburbs and the decline of downtown areas. However, she strongly resists being labeled by any ideological movement. Jane Jacobs was neither a nostalgic anti-growth conservation activist nor a believer in the ‘small is beautiful’ movement popular with her generation. She was a big fan of big cities and she believed that they were the essential drivers of economic growth.
Jane Jacobs, The Death and Life of Great American Cities, Random House, New York, 1961