A Private Sector Economy in Action

Alex Tabarrok comments on an NYT article:

Gurgaon has no publicly provided “functioning citywide sewer or drainage system; reliable electricity or water; public sidewalks, adequate parking, decent roads or any citywide system of public transportation.” Yet Gurgaon is a magnet for “India’s best-educated, English-speaking young professionals,” it has 26 shopping malls, seven golf courses, apartment towers, a sports stadium, five-star hotels and “a futuristic commercial hub called Cyber City [that] houses many of the world’s most respected corporations.” According to one survey, Gurgaon is India’s best city to work and live. So how does Gurgaon thrive? It thrives because in the absence of government the private sector has stepped in to provide transportation, utilities, security and more.

It's not all private sector though, according to NYT:

… a state agency, the Haryana Urban Development Authority, or HUDA, was supposed to build the infrastructure binding together the city.

And that is where the problems arose. HUDA and other state agencies could not keep up with the pace of construction.

Writes Tabarrok:

Gurgaon is described as a city of “private islands.” Private oases would be a better term. Within the private oases life is good but in between lies a desolate government desert.

Naturally, since everything is working well in the private sector and there has been a a failure in the parts left to the government, NYT suggests that some things need to be left to the government. Tabarrok again:

Much of the article is written as a “cautionary tale,” the private sector can’t do everything and the absence of government has made the city dysfunctional.

Only NYT could report on a fully functioning private sector and then somehow reach the conclusion that because there is dysfunction where the government is in charge that the government is needed.