Arrival Cities, Open and Closed, Across the Middle East

Most of the Middle East is troubled because most cities lack open societies and economies. State capitalism and socialism are the rule on most countries. Tradition-heavy societies regulated by entrenched elites is more the rule in world history than the exception. But rapid population growth and migration to cities have thrown a wrench into the many Middle East countries. Turkey was an exception as it has opened its economy and granted property rights to millions living in Istanbul’s former shantytowns.

Demographics is destiny (say demographers). This 2005 paper begins:

Egypt is the most populated Arab country, and, with a population of 74 million, ranks with Turkey and Iran, as one of the largest countries in the region. Its population was 10 million in 1897, it increased by almost six times since the beginning of the 20th century and by almost three times from 1950 to the present. (Source pdf)

Half the population in Egypt is under 25, and in the Kurdish regions of Iraq, Syria, and Turkey, the median age is 20. This means millions of young people each year will be ready for jobs, homes, and opportunities to earn better lives for themselves. Closed economies don’t offer these jobs and opportunities.

Open economies thrive on population growth. The U.S. population more than doubled since the 1950s, and more people meant producing and consuming goods and services each day. People are an infinity value in and of themselves, and are also the economy’s Ultimate Resource. Houses, cars, roads, are made and improved by workers, engineers, scientists, though companies, innovations and inventions. These are all good things.

Closed economies are stagnant, tied down with regulations that protect established companies and the elites of government, military, and business. When closed economies mix with fast-growing populations, and large-scale migration to cities, conflict, riots, and revolutions are the likely result.

The success of Turkey’s more open economy provides a Middle East counterpart to the stagnation and conflict of Egypt’s closed economy. Two hundred million Arab informals went to the streets to protest the closed economies of the Middle East. Of the forty-nine who set themselves on fire in protest, some two-thirds survived. Hernando de Soto notes that in interviews after, none of them had anything political to say. Instead, they wanted their rights to earn a living recognized.

Here’s another thing: we couldn’t get a political or philosophical statement from any of the families or the surviving self immolators; 60 percent of the self immolators did survive. But none of them had anything radically political to say. All they had to say were things like, you know, “We poor people also have the right to buy and sell.” These are very down-to-earth commercial and economic statements. – (Source)

Everyday people in Egypt, Tunisia, Iraq, Iran, and Palestinian territories have struggled without access to civil society, rule of law, voluntary exchange, international commerce and investment, and other benefits of economic freedom.

In Turkey though, partial economic liberalization allowed the millions of immigrants to Istanbul from rural Turkey to work their way into the middle class. The story was much the same as with the millions of immigrants from communist China to Hong Kong in the 1950s, 60s and 70s (Hong Kong though, was a freer economy, so prosperity rose faster and further).

Arrival City tells part of the migration story and economic transformation of Istanbul over the last 30 years. Arrival City has fascinating chapters on other cities transformed by migration, but the chapter on Istanbul stands out. People in Turkey still suffer from various levels of government and legal corruption and general institutional dysfunction. But compared to Egypt, Iraq, Iran, or other Arab countries, Turkey shows the promise of legal and economic reforms in Islamic developing countries.

The Turkish economy also benefited Turks being able to leave and work in other countries, sending money, experiences, and idea back to relatives in Turkey.

In 2003, some 3.2 million Turkish nationals lived in European countries. This interesting Migration Policy Institute article from 2003 article tells the long and complex story of migration to and from Turkey over the last century.