Jamaica and Alibaug

I have been thinking about this since you first wrote it a couple of weeks ago. I have many questions, such as "How long have these areas coexisted?" and "Has there been any trend in the size relationship of the areas, or even one area pushing the other further back?" We all know that over time people settled around ports and sources of water. Those same spots are also usually the most desirable areas if you're wealthy enough to be able to push enough of your neighbors out of the way so you could establish some extra privacy. Also, areas surrounding those initially desirable areas, which were too expensive to develop in the past due to resources (cost of putting in roads, electricity,etc), are now becoming developable, yet to get to them you need to traverse the older district. What I am getting at here is that the wealthy typically want to live close to where everyone has been living, although on their own terms. I don't believe that they are influenced to live in those areas due to an availability of low cost labor. I think at this point, labor is more necessary near the factories and labor centers, rather than near the homes of the rich. I believe, especially when you have limited land available and a large population, that the rich tend not to move very far out, and instead they establish within or on the edge of existing districts (or "gentrify") and expand. Looking at the US, you don't see new cities popping up just for the rich -- resort towns and second home destinations do, but they have generally not been primary residences -- and the move to the suburbs was really a middle-class that was growing too fast for cities to accommodate. Sadly, one would like to think that all ships would rise with the tide; or that wealth would trickle-down from one group to the other. However there seems not to be any evidence of that on a scale large enough to make a difference.

Hi Tarun, I must say the paradox you are describing is particularly noticeable in Mumbai. I find it rather striking in Nairobi and Lagos as well. Living in South Africa, it has almost become something you don't notice anymore. I must say the amazing part is the degree of economic activity that goes on in and around these informal settlements. It is certainly a micro (and informal) economy, but fast moving and increasingly technology enabled. One has to ponder the question whether this is driven by the affluent, i.e. whether the poor are still becoming poorer at the hands of those that have the means to exploit the informal economy. I guess the challenges for the poor have remained the same for many years - nutrition, medical care, education, etc. All our efforts have done little to keep up with a growing need amongst a fast growing population. At the end, we still trade on hope....

Thanks @ Tarun Khanna for the article. It is quite a challenging question.

I wonder: Does the proximity of poverty and wealth have any effect on poverty reduction over time per se, or does proximity among people of widely divergent means result in socioeconomic entrenchment? Under what conditions?

Thanks Tarun.. Mumbai is built on this dichotomy of cheap labor having access to low cost housing aka slums and affordable commute peacefully coexisting with luxury cars and yatchs. Very interesting point indeed