Work

Designing a general economic model to incentivize maintaining infrastructure in informal settlements

Year: 2025

Type: article

Abstract: This paper sketches the design for a general economic model (GEM) quantifying how informal settlements (also known as slums) function and interact with ancillary urban or rural regions. The GEM is an essential tool for calculating the incentive fee payable to residents of the informal settlement to maintain housing, healthcare, schools, water, sanitation, or other infrastructure improvements and investments made by third parties and to identify potential payors or funders of the incentive fee. It is suggested that the GEM resolve limitations of traditional cost-benefit analyses (CBAs) in order to better calculate such incentive fee amounts and ascertain the parties willing to pay them. To understand how the GEM fills data gaps and helps fund national commitments to the United Nations 2030 Sustainable Development Goals (SDGs), the financial constraints on two countries, Fiji and Indonesia, as exacerbated by the coronavirus COVID-19, and Indonesia’s village finance modernization scheme (Siskeudes) are discussed.

Source: Forum for Economic and Financial Studies

DOI: 10.59400/fefs1774

Author: Bruce Cahan

Institution: Stanford University

Language: English

Topic: Urban and Rural Development Challenges

Subfield: Urban Studies

Field: Social Sciences

Domain: Social Sciences

SDGs: Sustainable cities and communities, Industry, innovation and infrastructure, No poverty, Reduced inequalities

Open Access status: diamond

OpenAlex ID: W4407895081

FWCI:

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Related to: 10