Slum Upgrading and Long-run Urban Development: Evidence from Indonesia

Event Date: 13 October 2021

Speaker: Mariaflavia (Nina) Harari is an Assistant Professor of Real Estate at the Wharton School, University of Pennsylvania, specializing in urban economics and development economics.

Time: 4 pm

Please contact Rachel Hill (r.hill@strath.ac.uk) for Zoom details.

Abstract:

Developing country cities face massive urbanization. We investigate how to facilitate urban transformation through the lens of the 1969-1984 KIP program, which provided public goods to five million slum residents in Jakarta, Indonesia. We assemble high-resolution data on program boundaries and current outcomes, including novel slum indexes from photographs. Among historical slums, KIP areas have 14% lower land values and 50% fewer high-rises. They are more informal, denser, and land is more fragmented, consistent with delayed formalization. We assess dynamic inefficiency from KIP and find that surplus losses are concentrated in the top market potential areas only. Elsewhere, we find greater surplus in KIP, suggesting that slum upgrading can provide an attractive cost benefit balance in cities in early stages of urban development

If you would like to read the full paper, please click here.

Published: 7 October 2021