Retooling Metropolis How Social Media, Markets, and Regulatory Innovation Can Make America's Cities More Liveable

The Manhattan Institute has long been committed to staying at the forefront of urban-policy innovation.

Aaron M. Renn

Cities matter to the Manhattan Institute.

Since 2014, the Manhattan Institute has brought together public, private, and nonprofit leaders from around the country to shape the future of urban America. From housing to transportation and regulation to urban planning, we have developed nationally-relevant policy solutions grounded in unique local experiences.

Learn more about MI's work in U.S. cities by visiting our Urban Policy Series.

In the 1970s and 1980s, the questions of urban policy were existential—could America’s major urban centers survive at all?

Today, this question has been answered with a resounding yes in many U.S. cities, from New York to San Francisco, and Denver to Houston. Yet that very success poses new challenges to a new generation of urban leaders.

Today’s urban citizens demand effective, efficient government services. They are less tolerant of bureaucratic dysfunction. Technology is transforming the world; government is no exception. And the experiences that today’s urbanites have with technology, from the iPhone to Uber, set a high service-delivery bar that citizens expect government to meet. Meanwhile, problems of success, such as uneven economic advancement and soaring rents in many cities, pose challenges to future urban growth.

The Manhattan Institute has long been committed to staying at the forefront of urban-policy innovation. To that end, we have partnered with leading academics to commission the series of urban-innovation essays found in this volume—essays that speak directly to some of the big challenges that U.S. cities now face.

In the first essay, Harvard Business School’s Michael Luca discusses the innovative work that he and his team did in partnership with Yelp, a customer-review website, and the cities of San Francisco and Boston. Traditional urban-data applications have involved either making better internal use of government data or posting government data to an online portal to allow private users to take advantage of it. In Luca’s work, there is a bidirectional flow of data and more collaboration between private firms, such as Yelp, and cities.

Luca examined public-health inspection scores in San Francisco and helped get that information onto Yelp—a useful thing for the many diners who peruse it before selecting a restaurant to visit. He also discovered that reviews posted on Yelp can be used to predict which restaurants will subsequently fail health inspections. Luca worked with the city of Boston to run a contest to create an algorithm to apply that insight to Boston, which could potentially allow health inspectors to more efficiently target restaurants that are likely to have violations.

In the second essay, UCLA’s Donald Shoup outlines better ways for cities to manage their on-street real estate. Demand for parking is growing with cities, and new technology offers new ways of managing parking. He suggests that cities should use market-based pricing for parking meters, varying the price by time of day to reflect the variation in demand for parking spaces. He outlines the concept, and then reviews the results achieved when San Francisco implemented his policy for its new SFpark system.

“The Manhattan Institute has long been committed to staying at the forefront of urban-policy innovation. — Aaron M. Renn”

Shoup also describes how market-based pricing could be extended to residential street parking. His plan: allow neighbors to petition for a uniform price auction to allocate spaces to homeowners. The money raised would then be spent in the neighborhood itself. Rich and poor neighborhoods would both benefit through a “power-equalization system” of financial allocation.

In the third essay, Alex Armlovich and I address the problem of soaring housing prices in many U.S. cities. To help ease this burden, we suggest more aggressive permitting of so-called microunits—apartments that are smaller than conventional studios.

We highlight a number of the barriers to microunit construction, including minimum unit-size regulations, a lack of multiunit zoning generally, and other de facto restrictions, such as density caps. We then review the experience of microunits in Seattle and other cities, as well as the political barriers to them, including legacy opinions shaped by the history of single-room-occupancy hotels.

In the final essay, Jeffrey Liebman and Hanna Azemati, both at Harvard’s Kennedy School, discuss ways to help cities improve their contracting. Virtually everything that cities do involves some type of contracted purchase from the private sector. In Boston alone, contract purchasing totals $1.2 billion per year. But the contracts themselves often have not been changed in many years. Instead, they are simply rolled over as they expire. There is little high-level focus on pursuing strategic contracts, either.

Liebman and Azemati recommend that cities assign a senior member of the mayor’s inner circle to be responsible for strategic management of the city’s contract portfolio; and that cities explicitly define their goals for major procurement efforts, structure the contracts correctly (such as by bundling or unbundling items) to achieve those goals, and investigate innovative types of contracting, such as problem-based procurement.

These essays address diverse topics. But they all cover themes that directly speak to the problems, as well as the opportunities, that today’s city leaders face. 

Contributors

Alex Armlovich is a policy analyst at the Manhattan Institute. He primarily writes on urban issues including housing, transportation, and infrastructure. Armlovich is the author of MI’s “Poverty and Progress in New York” series, benchmarking quality of life in NYC across a wide array of policy fields. He has also co-authored two reports with Howard Husock on nonprofit philanthropy. Armlovich’s work has appeared in a variety of publications, including the New York Daily News, New York Post, U.S. News & World Report, Washington Examiner, and City Journal (co-authored with Judith Miller). He previously worked as an intern in the offices of Senator Charles Schumer (D-NY) and the U.K. Parliament’s Labour Party deputy leader. Armlovich holds a B.A. in economics and political science from the University of Rochester.

Hanna Azemati is an assistant director with the Government Performance Lab at Harvard’s Kennedy School. She is leading the Government Performance Lab’s work on the Bloomberg Philanthropies’ What Works Cities initiative. Azemati has also been supporting New York State’s Social Impact Bond initiatives, first as a Government Innovation Fellow and then as the Director of Social Innovation Financing for New York State. Previously, she was a financial analyst at Citigroup in New York and a fellow for Kiva in Kenya, Uganda, and Rwanda. Azemati earned a BA in Economics with a minor in Government from Dartmouth College as well as an MA in International Relations from Yale University.

Jeffrey Liebman is the Malcolm Wiener Professor of Public Policy at the Harvard Kennedy School where he teaches courses in social policy, public sector economics, and American economic policy. In his research, he studies tax and budget policy, social insurance, poverty, and income inequality. During the first two years of the Obama Administration, Liebman served at OMB, first as Executive Associate Director and Chief Economist and then as Acting Deputy Director. From 1998 to 1999, Liebman served as Special Assistant to the President for economic policy and coordinated the Clinton Administration’s Social Security reform technical working group. For the past five years, his Harvard Kennedy School Government Performance Lab has been providing pro bono technical assistance to state and local governments interested in improving the results they achieve for their citizens.

Michael Luca is a faculty member at the Harvard Business School. Professor Luca works closely with companies and cities to help them become more data-driven, and has ongoing collaborations with Yelp, Facebook, the UK government, and the city of Boston, in addition to other partners. Professor Luca teaches The Online Economy, an elective course about the strategic and operational decisions faced when designing and launching an online platform. He also teaches an elective course in which student teams develop behavioral interventions and experimental designs for government and company clients, called IFC: Behavioral Insights. Professor Luca’s current work focuses on digital data and platforms, analyzing a variety of companies including Yelp, Amazon, and Airbnb. He also works on issues related to the design of information disclosure. Focusing on the behavioral foundations of how people make decisions, Luca has done work on rankings, expert reviews, online consumer reviews, and quality disclosure laws, among other types of information provision. His work has been written about in a variety of media outlets including The Wall Street Journal, New York Times, Washington Post, Boston Globe, Guardian, Telegraph, Huffington Post, Harvard Business Review, Atlantic, Quartz, Vox, and Forbes.

Aaron Renn is a senior fellow at the Manhattan Institute, a contributing editor of City Journal, and an economic development columnist for Governing magazine. His work focuses on ways to help America’s cities thrive. During Renn’s 15-year career in management and technology consulting, he was a partner at Accenture and held several technology strategy roles and directed multimillion-dollar global technology implementations. Renn has contributed to The Guardian, Forbes.com, and numerous other publications. His perspectives on urban issues are regularly cited in the New York Times, Washington Post, Time, The Economist, Daily Telegraph, and other international media. Renn holds a B.S. from Indiana University, where he coauthored an early social-networking platform in 1991. He has created several widely used open-source software packages, including the only program for recovering data from corrupted gzip backups. In 1998, Renn launched one of the nation’s first blogs, the Weekly Breakdown, to cover the Chicago Transit Authority.

Donald Shoup is Distinguished Research Professor in the Department of Urban Planning at UCLA. His research has focused on how parking policies affect cities, the economy, and the environment. His research on employer-paid parking led to the passage of California’s parking cash-out law, and to changes in the Internal Revenue Code to encourage parking cash out. In his book, The High Cost of Free Parking, Shoup recommends that cities should charge fair market prices for on-street parking, use the meter revenue to finance public services in the metered neighborhoods, and remove off-street parking requirements. Shoup is a Fellow of the American Institute of Certified Planners, an Honorary Professor at the Beijing Transportation Research Center, and the Editor of ACCESS. In 2015, the American Planning Association gave Shoup its highest honor, the National Excellence Award for a Planning Pioneer.

• Chapter 1. Restaurant Hygiene and Social Media: How to Improve Regulatory Disclosures in the Digital Age by Michael Luca
• Chapter 2. The Right Price for Curb Parking by Donald Shoup 
• Chapter 3. Microunits: A Tool to Promote Affordable Housing by Aaron Renn and Alex Armlovich
• Chapter 4. How Cities Can Improve Their Procurement of Goods and Services by Jeffrey Liebman and Hanna Azemati

Editor's note: Download a full version of Urban Policy 2016 here.