AHI: what we think: Part 1, housing is the catalyst
Blog readers know that a while back, AHI received a $1,000,000 grant from the Bill & Melinda Gates Foundation, for a two-year research effort, with a modest goal:
Change the world’s understanding of what slums socioeconomically are, and therefore change how benefactor entities can help improve slums and cities in the global south. Do so by exploring the validity of two related hypotheses: (a) housing as catalyst for improving informal communities, and (b) non-governmental (often informal) enterprises as drivers.
[All inset quotes in this post come from our grant application.]
[As part of our research strategy, we are hiring an Executive Director and a Research Director, both positions full-time and based in
Far from being an aberration, a slum is an economically rational solution adopted by people moving to cities, a place where human desires and human enterprises have outrun formal institutions’ capacity to cope with population and economic growth.
A busy day in Dharavi
Seven years’ work via AHI has convinced me that in this, the century of cities, slums are the main demographic challenge, problem complex and difficult, whose solution will doubtless involve vast sums of money, deployed in a sophisticated plan whose shape I can only dimly guess.
[Editor’s note: Blog readers know I have visited many slums, and written about more of them. Among the major reference posts are these speculations:
Slums are economically rational
Slums are a wealth-extraction machine
A backpack, a laptop, a power source, and a cup of tea: the travelling office
And these site visits:
Historically, slums have been seen as a problem in enforcement or government. I think there’s a better change agent at hand:
Large institutions often underestimate housing as catalyst and local NGO capacity/ enterprise as change agents – that informal communities and enterprises can improve slums by themselves and via linkages to formal entities. This comprehensive new paradigm can inform and improve effectiveness of donor agency, entity, funding efforts. Our open research program will reach out for external input from academics and practitioners.
‘Open research’ means we’re not trying to hoard the ideas, either economically for profit or intellectually for credit.
My theory – and it’s mine!
Indeed, the less remarkable they seem, the more we will have succeeded. In short, if you think we’re right, email me; if you think we’re wrong, email me; and if you have evidence bearing on the question one way or another, email me.
This project addresses two related issues that can create the bottom-up self-organization that we believe is necessary to make the urban poor into an effective counterparty:
1. The crucial function of housing in improving informal urbanizing communities.
2. The capacity of non-government organizations (NGOs) as business enterprises to make change.
Blog readers will recognize that many of the ideas expressed in the grant application have been voiced on the AHI blog, such as in my post on Mission Entrepreneurial Entities (MEEs):
When I see change being made – in the
They’re the ones doing transactions.
They’re the ones turning resources into properties and developments.
They’re the ones organizing slum dwellers into political and economic forces.
They’re the ones whose activity changes the political environment.
MEEs are the change agents.
In housing-finance ecosystemic terms, they’re the critters.
We’re the gizmos driving change!
Perhaps it was easier for me to recognize the value of MEEs in the global south because I’ve spent the last thirty-three years (just short of a third of a century, gack) working with and for US Community Development Corporations (CDCs)
That’s me, fighting finance fires for over thirty years
These two keys to urbanization in the global south are currently problematic precisely because the formalized global north frequently overlooks them, both in its urbanization policies and in its entrepreneurial approaches to urban development. By contrast, AHI’s work as a practitioner, coupled with its founders’ thirty-plus years’ experience as a financier, creates an important body of knowledge and allows AHI’s research to be complemented by its real-world activity in this space and on these problems.
Making deals work – getting the sources to match the uses, the receipts to match the expenditures – gives you an appreciation for practicality akin to that of the Victorian paleontologist. You don’t know what the animals are supposed to be, so you document the bones and figure it out on your own.
Thinking about the origin of specie?
Housing touches everything connected to urbanization: indeed, housing may be considered to be what defines a city, because the built environment without housing is something else. Because people spend more than half of each day in their homes – the poor spend three-quarters or more of their day in or immediately adjacent to the home — any urban intervention touches upon the home, and its success depends on improving people’s home lives.
· Health. Without clean water and proper sanitation facilities in the home, assistance provided outside the home, such as vaccinations, has little resilience.
Happy children amid filth: Kibera,
· Education. Without a good home, it is more difficult to get to school, to stay in school, and to learn in school.
· Poverty and income. Traditionally, home is where entrepreneurial businesses start. In the global south, it is also where a lot of informal income is earned. In the home one can sew, work wood, repair electronics, cook meals. Better housing, in short, means more hours available for work, more ways to earn informal income, and more income generated.
I wondered, “If you can borrow money fast there, why not elsewhere?”
· Infrastructure: Infrastructure always has a large network component – highways, power plants, dams, reservoirs, plumbing and piping – yet that vast network can bypass whole neighborhoods. Traditional infrastructure finances stop at the site line, and even into the property itself. In most places, homes are the biggest consumers of municipal infrastructure, which is why in developed nations the water/ sewer bill runs right alongside the real estate tax bill and is paid to the municipality. While the finance of site and home infrastructure relies on the household, its provision relies as well on the municipality. Trunk infrastructure and site infrastructure must, literally, link up.
Drainage, Jardim Iporanga,
· Democratic society. Society emerges when people are rooted to a place, and in cities, it is the home. Even our word for it – neighborhood – means a place where people live together. Through housing and informal enterprise, the poor can gain consciousness, cohesion, and both economic and political clout. Housing and informal enterprise make the poor visible to the rich and powerful.
Municipal recognition in mailboxes and street addresses:
· Civic engagement at the city level. The value of housing links people to cities: the more people value their homes — and not just economic value but social and network value too – the more they care about their cities. Democracy flourishes when everyone’s home is an appreciating asset.
Even though housing is inextricably linked with these different aspects of cities, it is too often overlooked as a critical catalyst of urbanization.
If housing is the catalyst, who does the catalyzing?
[Continued tomorrow in Part 2.]
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