Economic Perspective

New planned cities can serve multiple purposes for developing nations, including attracting foreign investment, showcasing modernization efforts, and constructing a new national identity. While economic development is a factor, it is often intertwined with political and cultural objectives.³ These purpose-built urban centers offer opportunities to implement modern infrastructure and technologies from the ground up, potentially making them more attractive to businesses and investors than older, congested cities. Homi Kharas and Harinder Kohli suggest that middle-income countries need to transition from resource-driven growth to productivity-driven growth to avoid the “middle income trap.” ⁴ This involves shifting away from traditional sectors, fostering innovation-driven industries, and focusing on specialization rather than diversification. 

For example, a plan to build a new city in Solano County, California, known as “California Forever,” aims to address housing shortages and create job opportunities in an environmentally sustainable and energy-efficient manner. With California having a shortage of nearly three million homes, and the emigration of over one million residents post covid, the 160 thousand homes built in Solano County are intriguing to many of the State’s residents. With the urban center on the edge of Silicon Valley, corporate interest is fundamental to the development of these “affordable” homes.⁵

Additionally, the creation of Special Economic Zones (SEZs) in new cities is often used as a justification for new city development. Sarah Moser, Marian Swain, and Mohammed H. Alkhabbaz note that new cities like NEOM and King Abdullah Economic City (KAEC) in Saudi Arabia operate within SEZs, enjoying favorable business and trade laws that facilitate foreign direct investment.⁶

However, critics present compelling counterarguments to this economic rationale. David Harvey argues that the creation of new cities often serves as a means of absorbing surplus capital, potentially leading to speculative bubbles rather than sustainable economic growth. This process can exacerbate social inequalities, as the benefits of such developments tend to accrue disproportionately to wealthy investors and developers.⁷ Susan Fainstein emphasizes that the focus on creating new urban centers can divert resources and attention from addressing pressing issues in existing cities, where the majority of the population often resides. This approach may neglect the potential for more equitable improvements in established urban areas.⁸

Moreover, the argument for creating SEZs in new cities can be challenged by successful examples of SEZs implemented in or near existing urban areas. Cities like Shanghai and Dubai have successfully transformed areas through the development of SEZs without the need to build entirely new cities, demonstrating that the economic benefits of such zones can be achieved within existing urban frameworks.

Furthermore, the economic success of new cities is not guaranteed. Many such projects require massive upfront investments, often financed through public funds or debt, which can strain national budgets and potentially lead to financial instability if the expected returns do not materialize. In many cases, concerns have been raised that taxpayers may ultimately be responsible for covering the costs of these developments. For example, in Solano County, there are significant doubts about the project’s ability to address essential infrastructure needs such as public transportation and water supply, raising fears that the financial burden will fall on the residents and government.⁹

The long-term economic viability of these cities depends on their ability to attract and retain businesses and residents, which can be challenging in the face of competition from established urban centers. There is also a risk that economic benefits may be undermined by social inequalities and environmental costs associated with large-scale urban development.¹⁰

Environmental Perspective

The environmental argument for building new cities primarily centers on the implementation of modern, sustainable practices from the ground up. Federico Cugurullo examines this concept through the lens of Masdar City, a planned eco-city in Abu Dhabi. The author notes that new urban developments offer unique opportunities to integrate cutting-edge sustainable technologies and design principles that may be challenging to retrofit into existing urban fabrics.¹¹ For instance, developments like the proposed city in Solano County, California, plan to include large-scale sustainable initiatives such as an agri-solar farm capable of powering one and a half million households. In addition to renewable energy solutions, these projects often incorporate advanced waste management systems and innovative transportation solutions, all designed to minimize environmental impact.¹² 

However, Cugurullo also highlights the potential pitfalls of such projects, arguing that the actual sustainability outcomes of eco-city projects like Masdar often fall short of their ambitious goals due to conflicts with economic priorities and the challenges of implementing radical eco-innovations at scale. On the other hand, Mike Hodson and Simon Marvin present a more skeptical view of new city developments as solutions to environmental challenges. They argue that the focus on creating new, ostensibly sustainable urban areas may divert attention and resources from the pressing need to address environmental issues in existing cities, where the majority of the urban population resides. The authors suggest that the process of transitioning existing urban areas towards greater sustainability, while potentially more complex, may ultimately have a more significant and immediate impact on global environmental challenges.¹³ This perspective emphasizes the importance of considering the broader context of urbanization and the potential unintended consequences of prioritizing new developments over the renovation and adaptation of existing urban centers.

Technological Perspective

The technological argument for building new cities from scratch is compelling, as it offers opportunities to implement cutting-edge technologies and create integrated urban systems. Paul D Mullins and Sofia T Shwayri describe how new cities, such as Songdo in South Korea, have been developed as showcases for smart city technologies. These cities are extensively wired with networked smart systems, designed to gather real-time data and optimize urban living. However, the authors note that these initiatives are often driven more by government economic strategies and technology providers’ interests than by citizens’ needs.¹⁴ This approach reflects a broader trend where new cities are positioned as test beds for smart technologies, though the actual benefits and implications of such developments remain subject to debate.

One of the primary advantages of building new cities is the ability to integrate various urban systems from the ground up. This integration allows for seamless connectivity between energy, water, transportation, and other critical infrastructure components through technology.¹⁵ Furthermore, new cities can be designed with data collection and analysis in mind from the start, potentially leading to more efficient urban planning and management.¹⁶ This data-driven approach can help optimize resource allocation and improve the overall quality of life for residents.

Plans like the one in Solano County incentivize the development of critical infrastructure, such as transit and electrical systems, which are often neglected in the US. These foundational improvements enable the success of “smart” and “green” initiatives. The concept of “smart cities” has gained prominence in new city developments, attracting interest from major technology companies. In South Korea, the government has actively collaborated with private sector actors, particularly telecommunications companies like KT, to develop and implement smart city technologies. These companies see new cities as opportunities to showcase their technologies and potentially create innovation hubs. The promise of high-tech environments can also attract skilled workers, further fostering innovation and economic growth. However, these initiatives may prioritize the interests of technology providers over the needs of citizens. Additionally, there are concerns that some developers may emphasize the potential benefits while downplaying issues such as data privacy and the broader social implications of data usage for economic gain.¹⁷ 

This technology-driven approach to urban development is not without its critics. Some argue that the focus on building new, technologically advanced cities may exacerbate social inequalities. Rob Kitchin points out that smart city initiatives often overlook critical issues, including the potential for widening inequalities. He argues that there is a lack of critical reflection on the broader implications of technology-driven urban development, which could lead to uneven social outcomes.¹⁸

Moreover, the argument for building entirely new smart cities is challenged by the potential for retrofitting existing urban areas. Many smart city technologies can be implemented in established cities through targeted upgrades, offering a potentially more cost-effective and inclusive approach.¹⁹ The case of Barcelona demonstrates that older cities can successfully implement smart city initiatives, integrating new technologies into existing infrastructure and social fabric.²⁰

Barcelona’s smart city model shows that it is possible to transform traditional urban centers into technologically advanced cities without starting from scratch. The city has implemented various smart initiatives, including a sensor network, Open Data projects, and living labs, all within the context of its historic urban landscape.²¹ This approach not only preserves the city’s cultural heritage but also ensures that technological advancements benefit a diverse population.

Political Perspective

The construction of new cities from scratch is not merely an economic or urban planning endeavor; it often carries significant political implications. These projects can serve as powerful tools for national rebranding, reshape governance structures, accumulate capital, and even function as strategies to address or deflect political dissent.

One of the primary political motivations behind new city projects is their potential to serve as national rebranding tools. This is particularly relevant for previously colonized countries seeking to define their own identity in the post-colonial era.²² A classic example of this is Brasília, Brazil’s planned capital city inaugurated in 1960. Brasília’s inland location and modernist architecture were deliberately chosen to symbolize a break from the colonial past and to represent Brazil’s entry into a new era of modernity and progress.²³

In a similar vein, several countries are currently undertaking ambitious capital relocation projects. Egypt is in the process of building a new administrative capital forty-five kilometers east of Cairo. While officially framed as a solution to Cairo’s overcrowding and congestion, this move also reflects President Abdel Fattah el-Sisi’s broader strategy to consolidate his power. By relocating the capital, the government can exert greater control over public gatherings and limit the civilian population’s ability to mobilize against the regime. The new capital is equipped with advanced surveillance systems, including thousands of cameras, to monitor and manage public spaces more effectively.²⁴ Indonesia has also announced plans to move its capital from Jakarta to a new city in East Kalimantan on the island of Borneo. This decision is partly motivated by environmental concerns, as Jakarta is rapidly sinking, but it also reflects a political desire to shift the center of power away from Java and create a more geographically balanced nation. The relocation aims to address severe urban problems in Jakarta, such as overcrowding, traffic congestion, and flooding. Additionally, President Joko Widodo envisions the new capital as a smart, modern city that will foster technological innovation and symbolize Indonesia’s progress. This move is also seen as an effort to reduce regional inequalities and decentralize development, shifting the national paradigm from Java-centric to Indonesia-centric.²⁵

However, the political implications of new cities extend beyond symbolic gestures of national identity. These projects often involve significant changes in governance structures and social norms. King KAEC in Saudi Arabia provides a striking example of this phenomenon. Unlike traditional Saudi cities, KAEC is run by a CEO rather than a mayor and operates under a more relaxed set of social rules. This governance model represents a significant departure from current Saudi social values and reflects a shift in the ruling elite’s priorities.²⁶ Such differences in governance and social norms can create tensions between new cities and the rest of the country, potentially leading to a two-system policy within the nation.

While new cities are often presented as solutions to various social and economic challenges, they can also be seen as strategies to stave off political and social dissent. In the aftermath of events like the Arab Spring, some governments may view the creation of new urban spaces as a way to appease a population eager for change. However, this approach has also faced criticism. The creation of new cities often involves the displacement of existing communities, raising serious concerns about land rights and social justice. For instance, the NEOM project in Saudi Arabia has been criticized for potentially displacing up to 20,000 members of the Huwaitat Tribe.²⁷

David Harvey argues that the creation of new urban spaces often involves the dispossession of marginalized groups, leading to conflicts over land and resources. He suggests that urban development projects can become tools for class confrontation and the redistribution of wealth and power.²⁸ This perspective highlights the potential for new city projects to exacerbate existing social and economic inequalities, even as they promise modernity and progress.

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