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Special Economic Zones

Description​

A special economic zone (SEZ) is a geographical area within a nation state's jurisdiction operating through legal frameworks separate to those elsewhere in the nation and for a dedicated economic purpose.

Discussion​

SEZs are a powerful mechanism for limiting national government interference in a particular location.

From the national government perspective, SEZs are a policy tool to achieve political objectives. Such objectives typically include:

  • increasing direct foreign investment
  • reducing unemployment
  • facilitating innovation and entrepreneurship.

SEZs limit the scope of national government intervention within their boundaries, making them laboratories for alternative governance models. See also: free cities, jurisdiction, subsidiarity.

Notable examples include Próspera and Ciudad Morazán in Honduras, and the Dubai International Financial Centre.

Further Resources​

  • Titus Gebel, Free and Private Cities (3rd ed, Free Cities Foundation, 2023)
  • Lotta Moberg, The Political Economy of Special Economic Zones (Routledge, 2017)