Neighbourhood Economics, Part I

Nature of Neighbourhood Governance

By John Taylor; 2009 Sep 27, Mashiyyat 01, 166 BE


We have already discussed our ideas about the financial arrangements of households in a hillside housing development. Today, I want to give a quick review of the structure of a hillside development, then later go on to economics on the neighbourhood level, especially how credit and banking fit into it.

Depending on circumstances and location, a neighbourhood consists of anywhere between a dozen to a hundred households that reside along the streets of a city block. Its headquarters are centrally located, featuring a large "War and Peace" conference room with a large, interactive display of statistical and other data feeds about the locality. Residents and entire households visit this room in order to make their plans while viewing a simulation of the wider consequences of their actions.

The neighbourhood has a strict constitution with a charter that gives it monopoly control over and ownership of all real estate on its street. As a cooperative, every resident owns a fair share of its public assets. But as an institution it does not deal with individuals. Rather, it farms out responsibility for specific tasks to member households.

A neighbourhood is neither a government nor a private corporation but a combination of both. It is an open cooperative, owned and operated by member households for their benefit. But it has many features of a government, including the power to determine and collect taxes and the duty to uphold inalienable voting rights to all residents.

From an accounting point of view, the neighbourhood is both a publicly-held corporation and an association of many companies, since each household is a company in its nucleus and may run one or more subsidiary commercial services or enterprises. Unlike a government, though, all property of neighbourhoods is divided into stocks that are traded at an urban or regional stock and bond market.

In order to form or move in, member households must join the neighbourhood cooperative and purchase a minimum number of bonds and shares in the neighbourhood. Shares are bought and sold freely, but a minimum number must be retained by a household as long as it resides there. Similar arrangements apply for local banks and insurance companies. Unlike individuals and other economic entities, though, a household cannot reside or own property in more than one neighbourhood. This assures two things: member households will have a stake in the long-term stability of the locale, and will always give their whole attention to its prosperity.

Some jobs and administrative functions are rotated among households, others are appointed, chosen by lot or elected by secret ballot. The administration of the neighbourhood does not legislate, though it can sanction member families, usually with positive dividends and rewards, such as allowing a household to move to a more choice location. In rare, extreme cases of malfeasance, a neighbourhood may demote or banish member households, but it cannot dissolve them.

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