DEVELOPING POST-WAR BEIRUT (1990-2016): THE POLITICAL ECONOMY OF ‘PEGGED URBANIZATION’ BRUNO MAROT SCHOOL OF URBAN PLANNING MCGILL UNIVERSITY, MONTREAL JULY 2018 A thesis submitted to McGill University in partial fulfillment of the requirements of the degree of Doctor of Philosophy (Ph.D.) in Urban Planning, Policy and Design. © Bruno Marot 2018 i Table of Contents Abstract ....................................................................................................................................... xiii Acknowledgments ...................................................................................................................... xvii Preface .......................................................................................................................................... xix List of Boxes, Charts, Figures, Maps and Tables ...................................................................... xx List of Acronyms ....................................................................................................................... xxiv Chapter 1 – Introduction ............................................................................................................... 1 1.1 Beirut, the Capital City of a Widespread Diaspora Community and a Conflict-Ridden Country ........................................................................................................................................... 4 1.1.1 Lebanon: Figures and Facts .................................................................................................. 4 1.1.1.1 A land of permanent and temporary emigration .................................................................. 5 1.1.1.2 A brief political history of contemporary Lebanon .............................................................. 5 1.1.1.3 The post-war mutations of elite politics in a divided polity ............................................... 11 1.1.1.4 Is everything about political sectarianism and sectarian strife in post-1990 Lebanon? ... 16 1.1.2 Beirut: A Divided City Early Opened to Globalization ....................................................... 18 1.1.2.1 From late Ottoman rule to post-war reconstruction: a brief history of Beirut in the 20th and 21st centuries ............................................................................................................................ 18 1.1.2.2 The state of knowledge on urban production in post-war Beirut ....................................... 21 1.2. Research Questions, Arguments and Contributions .......................................................... 30 1.2.1 The Puzzle ............................................................................................................................. 30 1.2.2 Main Argument and Conceptual Proposition ..................................................................... 31 1.2.2.1 ‘Pegged urbanization:’ theorizing spatial production in financializing economies of the Global South ................................................................................................................................... 32 1.2.2.2 ‘Pegged urbanization’ in post-war Beirut ......................................................................... 34 1.2.3 Research Contributions ........................................................................................................ 36 1.2.3.1 The political economy of city-building in post-1990 Beirut ............................................... 36 1.2.3.2 South-focused urban development and studies .................................................................. 39 1.2.3.3 The plurality and complexity of urban production in conflict-shattered cities .................. 42 1.3 Research Design and Methods .............................................................................................. 44 1.3.1 Data Collection ..................................................................................................................... 44 1.3.2 Data Analysis and Theory Building .................................................................................... 46 ii 1.3.3 Positionality and Limitations ............................................................................................... 47 1.4 Overview of the Dissertation ................................................................................................. 48 1.4.1 Part One – Conceptual framework ...................................................................................... 48 1.4.2 Part Two - The regulation-urbanization nexus ................................................................... 49 1.4.3 Part Three – The implications of the nexus for urban development and housing provision ........................................................................................................................................................ 50 PART ONE v CONCEPTUAL FRAMEWORK ..................................................................... 53 Chapter 2 – ‘Pegged Urbanization’ in Post-War Lebanese Capitalism: A Framework for Institutional Analysis ................................................................................................................... 54 2.1 The Social Construction of the Economy: A Political Economy Approach Turned Toward the Role of Institutions .................................................................................................. 58 2.1.1 Theorizing Markets as Social Phenomena: The Seminal Contributions of Max Weber and Karl Polanyi ............................................................................................................................ 58 2.1.2 Institutional Analysis as a Methodological Framework ..................................................... 60 2.1.2.1 Institutions defined ............................................................................................................. 60 2.1.2.2 From old to new institutionalism: the contributions of major streams .............................. 62 2.2 Conceptualizing Lebanese Capitalism in the 21st Century: The Inputs of Critical Social Theory ........................................................................................................................................... 67 2.2.1 Regulation Theory: An Institutional Account of Capitalist Systems ................................. 67 2.2.1.1 The origins and objectives of regulation theory ................................................................. 68 2.2.1.2 The major contribution and limitations of regulation theory ............................................ 69 2.2.2 The Financial Turn of Capitalism in the Late 20th Century ............................................... 71 2.2.2.1 Finance-led capitalism: the restructuration of accumulation regimes and modes of social regulation ....................................................................................................................................... 73 2.2.2.2 The spread of ‘shareholder value’ to non-financial firms and households ....................... 77 2.2.2.3 Emerging geographies and trajectories of financialization in the Global South .............. 78 2.2.3 Contemporary Capitalism in the Middle East: The Dependence on Oil-Derived Rents ... 82 2.2.3.1 From rent to rentierism: the key input of Middle-Eastern studies to political economy research .......................................................................................................................................... 83 2.2.3.2 Rentier economies and external dependency ..................................................................... 85 iii 2.3 Understanding Beirut’s Urbanization: The Contributions of Critical Urban Theory .... 87 2.3.1 The Regulation Approach: Space without Property ........................................................... 87 2.3.2 Critical Urban Studies: Urban Production as a Capitalist Process ................................... 89 2.3.2.1 Neoclassical economics: the dominance of agency and price-based mechanisms ............ 90 2.3.2.2 Neo-Marxian sociology and geography: the connection of urban development to broader economic restructuring and social relations .................................................................................. 91 2.3.2.3 Urban political economy and the institutional model of development: the social construction of city-making ............................................................................................................ 94 2.3.3 The Urbanization of Capital in Financial Capitalism ...................................................... 100 2.3.3.1 The financialization of property assets: motivations, mechanisms, actors and implications ...................................................................................................................................................... 101 2.3.3.2 Real estate and construction activity: a key policy lever to regulate financial capitalism ...................................................................................................................................................... 106 2.3.3.3 Japan and Gulf Cooperation Council countries: two illustrations of property-based regulation ..................................................................................................................................... 111 2.4 Unpacking Urban Policy in Lebanon: The Power of Institutional Design ..................... 114 2.4.1 From the North: The Centrality of Formal State Action and Political-Economic