Formulating the Theoretical Costs of Border Cities

One of the key deficiencies in border studies is the lack of formulas associated with the costs border cities incur from the border itself. Before considering the net benefits of being a border city or categorizing the relation between border cities, it stands to reason that understanding the inherent costs are a matter of course. This is particularly important in order to understand why residents on either side of the border or in inland cities might hold a particular view of border interaction. Similarly, determining the extent to which a border city might carryout cross-border cooperation or a greater still foreign policy agenda. What follows is a short summary of the theoretical costs along a relatively open border between a richer and poorer nation (as measured by GDP/capita).

The key to understanding border costs is that border cities on the Rich Nation side must contend with: a) a poorer economic catchment zone that extends into the Poor Nation in comparison to inland regions of the Rich Nation and b) increased costs in reaching its regional population as a result of the costs of crossing the border from one country to the next. These two can be visualized in Figure 1 (below). These two drags on the local economy of border cities can only be mitigated through centralized policies on either side of the border. Whilst increasing the general wealth, in this case, of Mexicans within the border city’s catchment zone will depend on policies implemented in Mexico City and the state capitals, lowering the cost of crossing the border requires policy action within Washington D.C. This means that for border cities, strong lobbying efforts in national capitals of both countries are necessary for improving local economic conditions. An example of this is the U.S.-Mexico Border Mayors Association. An effective lobby would result in national policies that will create border conditions similar to those of inland metropoles eliminating disparities in mobility and socioeconomic similarity.

Figure 1. Theoretical Costs of Border Cities

By visualizing the theoretical costs faced by border cities (Figure 1) it becomes apparent that these costs can be understood from four different perspectives depending on a city’s relation to the border. If we assume that per Figure 1 each city is of equal size, with an equal catchment zone, and equal mobility costs within their catchment zones being the border the variable at play; then mobility costs and the socioeconomic similarity can be calculated from each perspective. Table 1 (below) shows, in accordance with the results of Figure 1, that the highest local GDP and lowest mobility costs will belong to Rich Nation Inland City. In comparison, Poor Nation Inland City will have the lowest local GDP as a result of the country’s lower GDP/capita whilst taking advantage of the lowest mobility costs. Border cities on either side can be understood in two ways: as two separate cities whose catchment zone (and thus population and its GDP) is cut in half and as a single city stitched together from both sides of the border. From this dual perspective border cities share half of GDP equal to that of what would be expected were it wholly a Rich Nation Inland City plus half of GDP equal to what would be expected were it wholly a Poor Nation Inland City. Yet one effect of this dual perspective is that depending on what side of the border you are on it seems that the border city either gained GDP or lost GDP given that 1/2x is worth more than 1/2y. A second effect of the dual perspective is that navigating the border city’s catchment zone requires overcoming the cost of crossing the border. Given that international requirements on the movement of people, goods, services, and capital are bilaterally agreed upon and reciprocated, it can be assumed that no matter in what direction the border is crossed the costs are the same. Therefore local mobility costs acquire an additional variable raising them higher than in Inland Cities on either side of the border.   

Table 1. Formulating General Border Costs