Four principles of effective city management

The problem with megacities? It's difficult for governments to manage them. McKinsey Global Institute researchers explain the problems cities will face -- and offer solutions for the future.
Written by Andrew Nusca, Contributor

Is there a limit to how big a city can manageably be?

Writing at McKinsey and Company's What Matters siteRichard Dobbs and Jaana Remes suggest that cities have precious little to stop them from growing bigger than ever before -- except the governments that run them.

According to research from the McKinsey Global Institute, there is no limiting factor -- in technology or infrastructure -- to how big or fast a city can grow.

The wild card: whether government officials and business leaders can manage that increased complexity.

The authors write:

We are now seeing cases where the growth rates of some large cities have begun to slow. In addition, the increased complexity of large size can overwhelm the ability to manage. When this happens, cities can become disastrous mixtures of slums and gridlock, raising the question of whether there is a maximum size for a workable city.

The authors follow by outlining a few key points about the coming era of megacities:

  • The share of the world’s population living in cities recently surpassed 50 percent.
  • By 2025,  another 1.2 billion people will become city dwellers. Ninety-five percent of them will be in developing countries.
  • The number of megacities -- with populations of more than 10 million -- will rise from 23 in 2010 to 36 in 2025.
  • Urban centers foster the growth of higher-productivity jobs and industries.
  • Urbanization reduces the cost of delivering basic services.
  • Urbanization benefits rural areas. "The decline in rural population as a result of urban migration allows rural areas to improve productivity, which in turn raises rural income," they write.

But city governments are "simply not prepared" to cope with this population boom, threatening to erode the benefits of urban economies of scale before they begin.

So what's to be done?

The authors suggest that cities focus on infrastructure, planning and jobs, outlining four principles for effective city management:

  1. Acquire sufficient funding to finance running costs and new infrastructure. Suggestions: monetizing land assets, levying taxes.
  2. Develop accountable governance. "Many large successful cities, including London and New York, have opted for empowered mayors with long tenures and clear accountability," they write.
  3. Support long-term planning schemes that span up to a 40-year horizon.
  4. Craft dedicated policies in critical areas, such as affordable housing.

The authors take steps to caution that megacities actually won't represent the majority of urban growth in the next two decades -- it will come from their smaller counterparts. But it's obviously wise to start thinking about the next stage of growth before it happens.

What’s the biggest limit on city growth? (Hint: it's not steel or cement) [What Matters]

Illustration: Evergreen State College

[via Planetizen]

This post was originally published on Smartplanet.com

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