Rethinking metropolitan governance: an exploration of urban entrepreneurialism in decentralized Indonesia : The case of Jakarta Metropolitan Region (JMR)

Past studies of urbanization in Indonesia found that market-oriented policies in Soeharto’s regime in the late 1980s already contributed to the rapid development in the Jakarta Metropolitan Region (JMR). They indicate the emergence of the phenomenon of urban entrepreneurialism which highlight an ambitious policies for gaining economic growth. However, indications are that following Indonesia’s decentralization reforms, this phenomenon became more visible at the local level and resulted in inter-urban competition. The intention between good planning for all on the one hand and generating fiscal income on the other hand, has lead to unexpected, even preverse outcomes of decentralization. This study investigates the extent to which municipalities in JMR show characteristics of urban entrepreneurialism, by considering overall trends across local governments in JMR and by zooming on and comparing two such fast growing municipalities. Several general implications can be drawn from the results: First, the intra-regional competition to escalate economic competitiveness has increased regional disparities in JMR. Second, the development of spectacular places, such as shopping malls and fancy buildings – at the expense of lower income group welfare – has transformed the suburbs into new urban centers and has created development fragmentation. Third, in both cases, the urban entrepreneurialism strategies rsther cause spatial segregation and environmental problems. Finally, the emerging trends of urban entrepreneurialism phenomenon in JMR seem inevitable if seen as a political agenda of mega-project development with deep cooperation between the local government and the private sectors. In order to prevent the negative impact of the growth competition, this study proposes The Government of Indonesia to strengthen the currently weak – regional administrative body (BKSP), to empower it to intervene in the planning and implementation of JMR development as a key organization keeping in mind the interest of all.