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What If Governments Were More Like Tech Startups? How to Grow a City in Honduras

Honduras is one of the most dangerous places in the world, boasting a murder rate almost double the next closest contender.

How do you fix a system that's so broken and corrupt that the citizens living under it go to lengths such as jumping aboard a freight train nicknamed "The Beast" with their children just to escape it? Some people are putting their hope in a new law that allows private investors to create autonomous legal and economic zones called ZEDEs, which they say will offer unprecedented opportunity and freedom for Honduran citizens.

"It's a very exciting moment, because this project, if it accomplishes what it's capable of doing, will demonstrate inside of Honduras and to the world that capacity of solving problems and creating jobs in particular can go forward with a velocity that very few people have been expecting," said Mark Klugmann, Co-Chair on the Committee for the Adoption of Best Practices, the board responsible for approving ZEDE applicants.

Zachary Caceres, executive director at the Startup Cities Institute at the University of Francisco Marroquin in Guatemala, believes that competition among small jurisdictions is the way out of poverty for citizens living in developing countries.

"On the one hand, we are very good at making physical technologies. Cell phones always get better, computers always get better, cameras always get better," says Caceres. "On the other hand, you have social technologies, the ways in which we organize ourselves, our governance systems. These are not subject to entrepreneurial trial and error. In fact, they are essentially locked away from competition and innovation."

Watch the Reason TV series below for a primer on the Honduran ZEDEs, a look at what's already working in Honduras, a contrary view of the ZEDEs from critics and skeptics, and some perspective from potential investors in the area.