Billy Regan thesis

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The Evolution of City-States:
A Look at Athens, Venice, Singapore and Hong Kong
Presented to
The Politics Department
In the partial fulfillment of the requirement for the degree
of Bachelor of Arts
By
William Regan
Bates College
Lewiston, Maine
January 2016

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Acknowledgments.
First and foremost I would like to thank my advisor Professor Alero Akporiaye.
Thank you for your patience, dedication and support that without I would not have
been able to complete this thesis. I hit some road bumps along the way, but your
positive attitude and sincere advice helped me push through. Again, thank you so
much for going above and beyond to guide me through this process.
I would then like to thank my family, friends, and teammates for their constant
support and encouragement throughout the past five months. Finally, thank you
mom and dad for love and support throughout my 4 years at Bates College.

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Table of Contents
Introduction……………………………………………………………………………………………....……...4
Chapter 1: Ancient Greek City-States………………………………………………………….……….7
Chapter 2: Italian City-States……………………………………………………………………….……..15
Chapter 3: Factors City-States Share……………………………………………………………….…..25
Location Compatible with Trade….................……………………………..……………26
Local Political Landscape…………………………………………………………………….27
Government…………………………………………………………………………………….....29
Downfall…………………………………………………………………………………………….30
Lack of Asian City-States……………………………………………………………………..31
Chapter 4: Modern City-States……………………………………………………………………………34
Singapore……………………………………………………………………………………………35
Hong Kong…………………………………………………………………………………………..40
Future…………………………………………………………………………………………………44
Chapter 5: The evolution of City-States………………………………………………………………..51
Partial Democracy………………………………………………………………………………51
Globalization………………………………………………………………………………………54
Conclusion…………………………………………………………………………………………………………57
Bibliography………………………………………………………………………………………………………59

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Introduction:
City-states are sovereign political entities that form in urban areas.
Compared to a traditional country, city-states do not possess direct control over
expansive territory and have relatively small populations. City-states stretch back
thousands of years, when the first significant city-states were developed in Ancient
Greece. City-states have had a huge impact on the world. City-states acted as
incubators for some of the fundamental principles that many current countries,
governments and economies use today.
The rise of the Greek Polis was a very important social formation in history
because it was the world’s first political community that defined the parameters of
the freedom of a citizen.1 Democracy was also developed and practiced as a
functioning system of government for the first time in some Greek city-states. In
particular, Athens was the birthplace of democracy and its model of government
became the bedrock of all other democracies in the future. The first chapter will
analyze the first democratic institutions created in Athens and how they helped the
city-state develop a trade based economy, a strong rule of law and defined
citizenship, which enabled Athens to reach unprecedented levels of wealth and
power.
This helped the rise of the next wave of city-states in Italy, which established
an extensive and extremely profitable global trading system. During the
1 Ian Morris. Burial and Ancient Society: The Rise of the Greek City-state.(Cambridge:
Cambridge University Press,1987) 1.

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Renaissance Italian city-states studied and adopted practices invented and used in
the Greek city-state period. The second chapter will look at how the city-state of
Venice in particular adopted and expanded on fundamental Greek city-state
principles. The Venetians built a strong city-state to fit their times by revisiting old
ideas and altering them to benefit their society.
All city-states share some key fundamental principles that ensure their
emergence and continued existence. The histories of these past city-states highlight
these common factors that allowed them to become independent and successful
city-states. The third chapter will identify and explain general commonalities that
city-states share, and why the political and economic foundations of city-states did
not exist in Asia until the eighteenth century. Eventually the rise of European
nation-states diminished the power and relevance of European city-states, but
Singapore and Hong Kong were exposed to the ideas through the influence of
western colonialism. As a result, city-states still exist today.
Hong Kong and Singapore are two modern models of how city-states have
held on two the key fundamental building blocks of a city-state. The forth chapter of
will analyze a brief history of these two city-states development and how they have
been able to build a robust economy and remain politically stable. Also, this chapter
will try to glance into the future of these city-states and explain how the current
global economic and political could effect their future.
Each period of city-states has had a lasting legacy on the global community. Over
time city-states have unintentionally been built off one another because of their
successful ideas and the creation of such ideas in most cases have outlasted the city-

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states themselves. It seems that the success of these city-states allows them to have
enough of a significant impact that surrounding areas adopt their norms and
policies. The final chapter will explore the fundamental changes that have been
made during each period of city-states and the possible causes of these changes. It is
impossible to say for certain, but Hong Kong and Singapore could create policies
that will soon be copied by nations around the globe.

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Chapter 1: Ancient Greek City-States
The Ancient Greeks founded the first city-states that would have a lasting
influence on the development of western governments and economies. The
fundamental ideas of citizenship were cultivated in Greek city-states. The
relationship between the state and citizenship was carried through the Middle Ages
and took root again during the Renaissance Period where it was further developed.2
This would become essential in the development of all future city-states. The rise of
the Greek city-states defined the parameter of the freedoms of a citizen, and the
modern idea of citizenship was clearly defined in Greek city-states. Citizens had
higher status than non-citizens and were thought of as more integral members of
both the society and the state. The distinction between a citizen and non-citizen
allowed for a set of laws for a privileged group because they were a part of the state.
Greek city-states spoke the same language and shared similar cultural and religious
practices, but they still had a broad range of differences in types of governments,
policies, and economies. Therefore, this chapter will focus on the ancient city-state
of Athens when generally referring to a Greek city-state. Also, the majority of the
ideas that outlived the Greek city-states and were adopted by later city-states,
originated in Athens.
The Greeks developed a radically new concept of the state, which developed
politics and made political relationships the core of how their new form of
2
Morris, The Rise of the Greek City-state,172.

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government functioned.3 The Greeks called this new form of society the Polis. The
Polis would essentially be referred to as a city-state later in history. There was a key
result of this new developed government. First, all authority was located in the
community; this created the role of the citizen which was the key to understanding
the new form of government. Aristotle stated, “the essence of the citizen was the
right to make judgments and to hold office, to rule and to be ruled in turn”.4 Any
monarchy or authoritarian government has a basic incentive to maintain and grow a
strong state in the name of self-preservation. A king’s first priority is maintaining his
personal power.
The new form of government that was ruled by the general community
created a new incentive for growing and developing a successful state. It is
important to note that citizenship in these states was given to a limited amount of
the population. For example, in order to be an Athenian citizen one had to be above
the age of 18, male and have both parents born in Athens. Athenian citizens only
account for ten to twenty percent of the population.5 However, this elite group of
citizens was more representative of the population than a monarchy. Citizens were
in control of placing their personal needs first. Citizens used the state to build a
state that benefited the community as a whole because they were personally
invested in the state’s well being. This game changing societal foundation allowed
Greek city-states to prosper and show the world the capability of a city-state.
3 Morris, The Rise of the Greek City-state, 2.
4 Morris, The Rise of the Greek City-state, 2.
5 John A Rothchild, "Introduction to Athenian Democracy of the Fifth and Fourth Centuries BCE," Wayne
State University Law School,(2009): 14, accessed December 20, 2015.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1020397##.

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The city-state of Athens was isolated by the Greek mountain ranges and had
time to develop slowly and reached the pinnacle of its power in the fourth and fifth
century BCE. After a period of tyrannical rule and conflict between the lower and
upper classes, Athens conceived a new form of government; democracy was
designed to fracture the aristocratic families hold on power and equally distribute
power among citizens.6 The rise of Athens democracy directly correlates with the
rise in its status and power among the Greek city-states. This two-century span of
time is referred to as the classical period of Athens. During this period a new system
of government, a trade based economy, art, education and philosophy all flourished.
Athens is referred to as ‘the birthplace of democracy’ and ‘the cradle of
western civilization’ because it developed and cemented so many foundations for
practices still used in modern governments, economies, and societies. Athens used
its power to actively spread its democratic ideology through out the Aegean and
parts of Asia Minor.7 The exposure of Athenian democracy to other city-states
spread the idea of democracy that would far outlast the city-state. The basic goals of
the Athenian democracy “aimed to vest ultimate power in the citizens; to prevent
overreaching by public officials and subversion of the democracy; to give public
officials an incentive to perform for the benefit of the community; to create a stable
constitutional structure; and to implement the rule of law”.8 Democratic institutions
offered the foundation for a never before seen level of transparency.
6 John Camp, and Elizabeth A. Fisher, The World of the Ancient Greeks. (New York, N.Y.: Thames &
Hudson,2002),119.
7 Victor Davis Hanson, A War Like No Other: How the Athenians and Spartans Fought the Peloponnesian
War, (New York: Random House,2005), 13.
8 Rothchild, "Introduction to Athenian Democracy," 13.

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The Government consisted of three main branches: the legislative, the
administrative, and the judicial. The Legislative consisted of two bodies, the
Assembly and the Council of five hundred. The Assembly ultimately held the most
legislative authority and included all male citizens; it would meet every ten days to
vote on legislation approved by the Council of five hundred.9 The council of five
hundred members had one-year terms and their duties included bringing legislation
to the Assembly, overseeing the bureaucracy, and handling foreign affairs.10 All
fundamental policies and ideas were decided in the legislative branch and they were
the highest authority in the government.
The city-state’s day-to-day administrative duties included fiscal matters,
grains supply, handling water supply, and policing; the administration of choosing
these citizens was done by lot rather then by elections.11 All citizens had a
responsibility to serve the city-state. There was an incentive to maximize people
efficiency because citizens were directly involved in the well being of the city-state.
The judicial branch was an extremely important piece of the government. A
group of six thousand citizens were chosen by lot to serve one-year terms as jurors,
who then were placed into groups of two hundred to five hundred, depending on the
caseload.12 Private parties were responsible for bringing almost all the cases to the
courts and the Jury’s final decision was uncontested.13 People had the ability to
bring their issues to a court that was transparent and receive a fair hearing. Laws in
9 Camp and Fisher, The World of the Ancient Greeks, 121.
10 Rothchild, "Introduction to Athenian Democracy," 16.
12 Thomas R Martin. Ancient Greece: From Prehistoric to Hellenistic times. (New Haven: Yale University
Press, 1996) 110.
13 Martin, Ancient Greece, 110.

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theory were carried out equally among citizens, so every citizen was held to the
same standard. Athenians who became jurors defined the structural principles of
public life because they were responsible for interpreting the law. This brief
description of Athens’ democratic system and procedures highlights the importance
of citizenship within a city-state. For the first time in history a government was
equally controlled by a relatively large percentage of the state’s population.
As Athens developed its democracy, its wealth and status began to grow.
Athens democratic government began to increase trade with other city-states. Even
though citizens had direct control of the government “trade introduced a new,
individualistic type of economic activity in which no social limit to acquisition was
set”.14 Non-citizens had the ability to increase their wealth through entrepreneurial
skills. Athens benefited from a trade based economy, but the majority of traders
were not citizens. Traders were not particularly held in high regard in Athenian
society. However, the government understood their value and maintained a state
with a strong economy where traders were a vital component. The typical
“respectable” citizen was self-employed by managing and owning a farm or
practicing a skilled craft; slaves supplied domestic services and manual labor and
foreigners and metics (residents that did not have citizenship) were mostly
traders.15 Citizens did not participate in most of the work preformed in the state,
but had a very active and time-consuming role in the government.
14 S. C. Humphreys, "Economy and Society in Classical Athens," Annali Della Scuola Normale Superiore
Di Pisa. Lettere, Storia E Filosofia, (1970): 6, Accessed December 21, 2015.
http://www.jstor.org/stable/24300284.
15 Humphreys, "Economy and Society in Classical Athens," 10.

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The citizens’ role in Athens’ trade was managing government institutions and
infrastructure that facilitated and protected trade. The League of Delian that united
many city-states surrounding the Aegean Sea was created under the leadership of
Athens. The government exploited this leadership position to build its relationship
with other city-states, so Athens increased and secured trade. The city-state also
collected a substantial amount of revenue because it charged high patron fees to the
members of the league.16 The government also protected its trade based economy
by investing money into making Athens a strong Maritime power. Athens placed the
protection of its port as a high priority. The government spent a massive amount of
resources to fortify the port and to build a two-sided wall that secured a safe
passage between the city and the port, so it could continue to trade even when it
was under siege.17 These are all examples of how the government made smart
policy choices to protect and secure trade because it was a valuable resource to the
city-state.
Athens began to slowly decline when its economy began to suffer. Since
Athens was dependent on trade conflict with other rival city-states slowly eroded its
economic capability. Athens’ revenue started to decline from overseas trading when
the Peloponnesian War began. This caused many citizens to lose wealth, so they
used their political power to receive money from the state’s coffers; this destroyed
capital, which could have been used to build up the economy, and it ultimately
stifled economic initiative.18 Arguably this is an example where democracy hurt the
18 Humphreys, "Economy and Society in Classical Athens," 6.

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city-state. In a time of crisis Athens government did not have the ability to take
decisive action to insure the future of the city-state. Athens was defeated by the city-
state of Sparta in the Peloponnesian War. Athens democracy was temporarily
dismantled and replaced with an oligarchy. It was also forced to surrender its
position as the leading city-state of the Delian league. Sparta tried to replace Athens
as the leader of the city-states, but proved to be incompetent at managing all of the
city-states as subjects.19 Sparta was a strong military oligarchy, but it lacked the
intellectual capital that Athens’ government helped foster and maintain. Athens was
an intellectual incubator and enabled it to successfully build and manage a league of
different and divided city-states. The defeat of Athens damaged the city-state, but it
was still able to start to rebuild its economy and reestablish its democracy shortly
after the war.20
Athens remained an independent city-state and began to rebuild its wealth
after the Peloponnesian War, but it never returned to its former glory. The final nail
in Athens’ coffin was the conquest by Philip of Macedonia of Greece in 338 BCE.21
An economically weak Athens was unable to fight the might of larger empires that
relentlessly sought to expand their power and territory. Athens may have lost its
political and economic power, but it still remained a cultural and educational center
in the Mediterranean for centuries and this allowed them to spread their history and
ideas to other cultures and regions.22 The Greek city-states most important legacy is
19 Hanson,A War Like No Other, 290.
20 Hanson,A War Like No Other, 291.
22Camp and Fisher, The World of the Ancient Greeks, 119.

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the manifestation of citizenship. This seemingly simple idea changed peoples’
relationship with government. Citizens have a stronger connection a state because
they have some level of participation.

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Chapter 2: ItalianCity-States
While Athens and other Greek city-states created modern ideas of
government and judiciary systems, eleventh century city-states helped foster the
strong “global” economic role of city-states. Western city-states in the eleventh
century were developed through commercial, financial and industrial entrepreneurs
and craftsmen. Italian city-states in particular further developed and expanded the
importance of a strong global economy. Most Italian city-states had republican
forms of government that were adopted from the Greeks and Romans. The
Renaissance Period was a rebirth of classical learning and rediscovery of Ancient
Rome and Ancient Greece society. Italian city-states existed before and during the
Renaissance Period. Italian city-states were the main architects of the Renaissance
by adopting and expanding past ideas that originated in city-states that were almost
a millennia old. The Renaissance Period is normally associated with famous art,
breakthrough of scientific discoveries, growth of education, and growing global
commerce. This was only possible because Italian city-states’ economies and
governments were modeled from Ancient Greek city-states methods and offered a
structure that enabled progress.
The politics and economies of Italian city-states were dependent on each
other and that helped define the type and structure of their counterpart. A number
of interlaced councils made major decisions in the Italian city-states. Leading adult
male citizens, except for clergymen, were elected to fill seats on executive and

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legislative councils, and terms of office ranged from two months to one year.23 The
criteria of enfranchisement and the right to hold office were broad across Italian
city-states, but did not extend to all the inhabitants of the city-states. Their system
of government had influences of democracy and a monarchy. Italian city-states had
a wide range of policies, so Venice, arguably the most powerful European city-state,
will be used for examples of specific policies.
Venice is a unique city-state for many reasons. Venice is a city on a lagoon
and it did not have any meaningful or substantial territory in the beginning. This
early characteristic played a major role in the development of the city-state’s
political and economic system, and resulted in the city-state becoming one of
Europe’s wealthiest maritime powers. This characteristic helped develop a new
class of elites. Traditionally the aristocracy obtained its power through land, but in
Venice wealth and status were obtained through entrepreneurial skill.24 This
created an uncommon dynamic for the foundation of an emerging city-state.
The Venetian merchants, from the tenth century, became the intermediaries
between East and West. Venice was located near primary rivers and roads that
entered into Europe and its maritime dominance made the city-state a logical area
to do business. They received trading privileges from the Byzantine Emperors. In
the ninth century the Venetian merchants escalated their business with a simple
business model, buy low and sell high; Europeans would pay a high price for eastern
23 Jonathan Dewald, "City-State." In Europe 1450 to 1789: Encyclopedia of the Early Modern
World, Vol. 1. (New York City, New York: Charles Scribner's Sons, 2004), 515.
24 Thomas F Madden,Venice: A New History, (New York, New York: Viking, 2012), 32.

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goods and European goods were in high demand within the Byzantine Empire.25
The trading privilege gave the Venetians a monopoly on these goods and was one of
the catalysts for their trade-based economy. This lay the foundation for Venice’s
capitalist nature that would become the city-states defining quality. Strong ruling
Venetian families, guilds of skilled craftsmen, and traders gained strong influence
and control over the government. Their rise in power correlates with the rise in
their economic success.
A developed middle class was able to gain a significant amount of
independence from feudal or royal authorities.26 The city-state helped create a
middleclass that was strong enough and united enough to earn autonomy. Any
ruling authority could not challenge the economic might or importance of this
middle class. Unlike Athens, Venetians citizens took part in trade, and as a result
they had the ability to use their political power to improve their trading businesses.
Merchants, financiers and artisans were able to form a cohesive body. Since they
were the driving forces of economic growth, the state benefitted from an organized
middle class and therefore encouraged their growth.27 For the first time in history,
private enterprises not only rivaled the state’s authority but also was one of the
prominent reasons the state had autonomy and authority. Just people choosing to
do so cannot create a complicated and extensive trade system. It needs the
incentives created through protection of private property and a strong judicial
system that treated citizens equally to be successful.
25 Madden,Venice: A New History, 47.
26 Theodore Geiger and Frances M. Geiger. Tales of Two City-states:The Development Progress
of Hong Kong and Singapore.(Washington: National Planning Association), 3.
27 Dewald, "City-State", 517.

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The city-state as a whole benefited from a strong independent middle class
that was trade oriented. Venetian merchants were empowered to be
entrepreneurial. Marco Polo introduced Venice to the expansive Mongol Empire,
which opened trade routes to the east through the black sea. This was incredibly
important for Venetian trade because the Red Sea was previously the only trade
route that could reach the spice rich region of the East Indies and it crossed through
territory that was unfriendly to Venetian traders.28 This paramount contribution to
Venice was not achieved by state sponsored envoys, but private merchants
spreading wealth. It can be argued that Italian city-states were the catalyst of
modern global trade because they opened trade to Asia. Global trade was still very
primitive during the Italian city-state period, but they proved that global trade could
turn a state with little to no natural resources into a legitimate and recognized
power.
The Republic of Venice was a sovereign city-state for almost a millennia.
Therefore, its government experienced change, but it did retain fundamental
principles throughout its history. Tribunes overseen by an elected Duke, referred to
as the Doge, governed Venice. European Kings and Byzantine Emperors received
their authority from God; the Doge’s power came from the people because they
prized freedom and distrusted centralized power. 29 The Doge was the official leader
but there was a series of Councils that ran the government. The Great Council was
the largest, two thousand members, and most powerful branch of government
28 Frederic Chapin Lane, Venice,a Maritime Republic, (Baltimore, Maryland: Johns Hopkins University
Press, 1973), 82.

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because it was in charge of enacting legislation.30 The Senate and the Ducal Council
were smaller and were in charge of managing the bureaucracy, sending out envoys,
and commanding the fleet.31 The only adult male nobles whose legitimate ancestry
could be traced were eligible to hold office. The term nobility was a loose term in
Venice and tended to change. The merchant nobility took absolute control of
government in the fourteenth century by enacting laws that only allowed a legally
defined class to hold office.32 Government and business interest were one in the
same and this allowed merchants of Venice to use a unified bureaucracy to increase
and benefit trade. This Merchant oligarchy controlled the government until the fall
of the republic. The merchant controlled government used their power to protect
their businesses.
An important tool for protecting trade was the judicial system. City-states
developed strong legal and judiciary institutions that ensured property rights for
owners.33 This protected investments from being seized or interrupted by the state.
This level of security on people’s property was uncommon and gave people an
incentive to invest in private enterprises because they had a considerable guarantee
that their investment would be protected by the state. The merchant class was
particularly dependent on the social defense system because it provided a climate of
peace and stability, which was crucial for trade.34 A justice system needs to show
30 Lane, Venice, a Maritime Republic,97.
32 Guido Ruggiero. "Law and Punishment in Early Renaissance Venice." The Journal of Criminal Law and
Criminology 69, no. 2 (1978): 243. Accessed December 22, 2016, 1.
http://scholarlycommons.law.northwestern.edu/cgi/viewcontent.cgi?article=6072&context=jclc .
33 Geiger and Geiger, Tales of Two City-states, 4.
34 Ruggiero, "Law and Punishment in Early Renaissance Venice", 1.

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moderate consistency in its decisions, so people can understand how the system will
generally interpret and enforce the law. While courts did not have a jury, trials had
a number of judges and they had to come to a consensus on a verdict.35 This was an
attempt to keep the justice system free of corruption and also make decisions that
benefited the merchant class’s economic needs. “The law, rather than limiting the
judges, freed the judges to match punishment with crime in a manner responsive to
the nuances of societal need.”36
Religion had a major influence in the development and politics of these city-
states. The height of the Italian city-states coincides with the Catholic Church’s
dominant influence. The Pope’s influence reached into the politics of all forms of
governments throughout Europe. There was almost no separation of church and
state. However, Italian city-states managed to maintain independence by managing
their interactions through their own local parishes. City-states’ local churches and
clergymen were extremely important. In Venice, leaders of the local church came
from prominent local families, so the local church had more allegiance to the city-
state than to the papacy.37 Once in office, the local patriarch was expected to follow
the lead of the civil government in disputes with the papacy and on matters affecting
the civil government.38 Venice’s relationship with the Catholic Church is an example
of smart policy because it would have an impact on Venice’s economic policy. The
relationship between the Catholic Church and Italian city-states was not one sided; a
majority of Italian city-states did not bend to the will of the Papacy and placed their
36 Ruggiero, "Law and Punishment in Early Renaissance Venice", 15.
37
Dewald, "City-State", 516.
38
Dewald, "City-State", 516.

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own political and economic needs above the church.
The Republic of Venice is an excellent example to illustrate a city-state’s
disregard of the Papacy’s guidelines of dealing with non-Christians. The religious
demographics of Venice were diverse. It was not just a Catholic only state. While the
government remained in Catholic control and Catholics populated the city, other
groups were able to thrive in Venice because their business benefited the city-state
as a whole. Marginalized and even hated groups such as Jews and other undesirable
foreigners in Europe were able to continue their business with little harassment
from the government or people in the city-states. This was uncommon in the time
period and it highlights that city-states were dependent on a strong economy and
would do anything to preserve this strong economy. The Republic of Venice’s
inclusion of different groups attracted intellectual capital and empowered
entrepreneurs to invest in businesses because of the Venetian Government’s laws
and policies protecting private businesses.
To a certain extent talent and skill was the most important quality of a
resident in the Republic of Venice. Jews primarily handled the money lending in
Europe during the Middle Ages because Christianity forbid charging interest.39 This
was eventually outgrown when the usefulness of banks was realized and their
contribution to a trade based economy could not be ignored. Many of these Jewish
moneylenders lent money to lords and kings. This resulted in “powerful, debt-
ridden lords” dealing with Jewish moneylenders by expelling them from the
country, so the monarchy would not have to repay its debts; the monarchy of

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England in 1290 and France in 1306 expelled Jews from their countries.40 Venice
did not expel Jews and allowed them to do business within the city-state. Jews were
not welcomed with open arms but they slowly began to be integrated into the
Venetian society and economy. From 1509 to 1515 Venice waged war with the
League of Cambrai. During the war and after the war Jews were able to live in the
city of Venice because the states coffers were empty and the Jews were willing to
pay for the right to lend money in the city.41 The government exploited any
opportunity it could to maintain its economic strength in a period of war because
economic strength was the backbone of the Republic of Venice.
Jews were permitted to live in a certain area of the city known as the ghetto.
The small scale money lending that the Jews provided was crucial to the Venetian
state, and in 1553 the Senate stated, “ This council has permitted the Jews to dwell
in our dominions for the sole purpose of preventing Christians from usurious
lending in violation of both the divine and civil law”.42 The Venetian government
recognized that Jews played a crucial role in maintaining a strong economy. As a
result, the Jews were able to build their businesses because the state protected their
right to property. The government was able to make such a controversial decision
that a majority of citizens and neighboring nations disliked because it was for the
greater good of the city-state.
Venice was a maritime power and built its power on its trade with the east.
Venice traded with the east through the Byzantine Empire, which was Christian.
41 Frederic Chapin Lane, Venice, a Maritime Republic,(Baltimore, Maryland: Johns Hopkins University
Press, 1973), 300.

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However, the decline of the Byzantine Empire forced the Venetians to trade with
Muslims. The Ottoman Empire slowly replaced the Byzantine Empire, so Venice
started to trade with them in spite of the religious differences.43They tolerated
foreigners, like Muslims, because they were major trading partners. Venice was
directly profiting from dealing with Muslim Kingdoms during and after the period of
the Crusades. The Crusades were a period when Christians waged war with Muslim
Kingdoms in the name of Christianity and reclaiming the Holy Land. European
Monarchies spent massive amounts of resources sending armies to the Holy Land in
the name of Christianity. Venice contributed money and some ships to the Crusades,
but it only waged full-scale war when another nation threatened its trading routes
and colonies.44 Venice could not afford to wage unnecessary religious wars because
the preservation of its economy was a higher priority.
In 1500 the Italian city-states played an essential role in European politics,
economies, and culture, but they could not sustain the money and manpower to
defend themselves against aggressive territorial monarchies. From 1500 city-states
throughout Europe were in crisis or decline.45 They could not compete against large
national economies, and their artistic and intellectual greatness disappeared. The
European city-states began to decline during the centuries between the Renaissance
Period and the French Revolution.46 The Republic of Venice was one of the last
remaining city-states in Europe and remained an independent city-state for almost
45 Tom Scott, The City-state in Europe, 1000-1600: Hinterland, Territory, Region. (Oxford:
Oxford University Press,2014), 193.

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an entire century. However, Venice lost Cyprus in 1571 and Crete and the rest of its
eastern Mediterranean Empire in a series of wars with the Turks between 1645 and
1718.47 Venice lost its monopoly on trade with the east as technology in navigation
and shipbuilding increased and other European nations could travel longer
distances. Venetian economic strength began to dwindle, but it remained a major
center of European cultural, intellectual, artistic, and musical development. In 1797,
the thousand year-old Republic of Venice officially ended when Napoleon Bonaparte
conquered the city-state. Venice and all other Italian city-states are now just cities
that have merged into the large nation-state of Italy.
It is important to note that city-states existed in other parts of Europe at the
same time as Italian city-states, and ultimately suffered the same fate. German city-
states were sparsely populated and did not develop extensive trade routes.48 Not
ruled by prince or bishop, they were self-governing states that recognized only the
remote presence of the Holy Roman emperor.49 Along with princes, prince-bishops,
and knights, the free imperial cities had their own representation. They shared
fundamental similarities with Italian city-states, but did not reach the same level of
power and wealth. German city-states in duration, territorial extent, political
assertion, and administrative consolidation were inferior to Italian city-states.50
German and other European city-states have received far less attention then Italian
city-states by Historians. As a result there is less material to study these city-states.
48 Scott, The City-state in Europe, 214.

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They were not selected in this thesis because their relevance to the main argument
is marginal.
The Italian city-states showed the world the significance of intellectual
capital, trade based economy, and how a government can drive economic success.
The government was also willing and able to enfranchise people. After the war of
Chiogga, the Venetian government awarded thirty wealthy common families the
tittle of nobility because they could benefit the state.51 In a period where social
mobility did not exist, Venice was truly a capitalist driven society that allowed
businessmen with luck and skill to increase their status and wealth. Social mobility
was by no means available to every Venetian, but Venice was truly ahead of its time.
Venice was not able to stand up to the tide of the nation-state. However, it showed
the world the power a small city-state could have if it possessed a strong economy.
It also was a major catalyst of global trade that would continue to grow and develop
into the world economy that exists today. The city-states themselves did not survive,
but their legacy and positive attributes were imbedded throughout Europe. These
European powers would act as a bridge to bring these same ideas to Asia.

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Chapter 3: Factors City-States Share
The rise and fall of the Greek and Italian city-states all share fundamental
similarities. I believe there are three principle factors shared by city-states. First,
city-states need to be strategically located to trade routes because their economies
are dependent on trade. Second, the local political landscape needs to be
fragmented to prevent a larger neighboring state from enveloping the small city-
state before it has time to develop a strong economy. Third, there has to be a group
of elites that enact effective economic policies to maintain a strong economy.
Forms of government do not matter provided the majority of citizens within a city-
state benefit in some form from a strong economy. The three components that
determine the emergence of a city-state do not carry the same degree of importance
and can vary. I deduced these three factors after studying past and current city-
states and observing that they all share these similarities. While, there are other
factors that determine the existence of city-states, I believe that these are the most
important and logical factors that produce successful city-states.
It is also important to note that all of theses city-states follow a pattern of
copying the key fundamental aspects from a previous city-state that allows them to
function. Ancient Greek city-states are the exception because they were the first
group of city-states and created the foundation for all future city-states. There is a
clear chain of ideas passing through history. The European city-states adopted ideas
of Ancient Greek city-states during the Renaissance Period. And as we will see in
the next chapter, Hong Kong and Singapore were introduced to the city-sate legacy
through European Colonization. All city-states after the era of ancient Greek city-

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states hold on to the idea of citizenship and protection of property through a clear
rule of law. Ultimately, city-states are formed when certain circumstances exist.
Location Compatible with Trade
The location of city-states is important in determining their success and
autonomy. City-states tend to start in small urban cities near the coast. Ancient
Greek and Italian city-states, Singapore, and Hong Kong all share the same
geographic similarity of being near the coast. Ocean trading routes have always
been the fastest and easiest way to ship large amounts of goods. Having access to
the ocean is essential for large scale trading. Being near the coast is not the only
factor that helps trade.
It helps city-states to also be in a location that is not just on the coast, but is
also relevant and conducive for trade with other states. It is difficult to be a center
for trade if a city-state is not centrally located around trading partners or trade
routes. Trading routes can definitely be increased or expanded through a city-states
policy. However, all the city-states studied in this paper are located near other
trading partners and their location boosted trade at an early stage. Athens was
surrounded by other states that were willing and able to partake in trade. Venice
was strategically located between the east and the west. Many of these powerful
city-states economies were centered on trade and seaports have traditionally been
the most efficient means to facilitate trade.

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Local Political landscape
The local political landscape and greater political landscape of neighboring
states are crucial in the development of a city-state. Surrounding states need to be
fragmented and lack the ability or willingness to absorb surrounding smaller states.
It is important to note that city-states are inherently small and their immediate
neighbors therefore tended to be culturally very similar. The tendency was for
clusters of city-states that share language, religion and other cultural features but
are politically fragmented into a certain number of political units.52 This holds true
for all past periods of city-states.
City-states drive political wedges between groups that share similar cultural
identity and heritage. For example, residents of Italian city-states all spoke the same
language and were mostly Catholic, but had different governments that divided the
residents. The local government needs to have legitimacy and be unified, so it can
take advantage of the lack of strong states by building its own strong and
independent state. In the Middle Ages areas of Europe lacked strong territorial
monarchies, so city-states had the opportunity to build their strength before any
large countries gained serious power.53 Once city-states became economic
powerhouses and had serious legitimacy, their surrounding political landscape
became less important.
In most cases a city-state’s economic success provided economic benefits
for the surrounding states because its economic success spilled over into the
52 Walter Scheidel, "Republics between Hegemony and Empire: How Ancient City-states Built
Empires and the USA Doesn’t." 2006. Accessed October 10,2015, 6.

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surrounding states. Through the use of global trade, some city-states make their
neighbors dependent on their continued economic success. Venice had a monopoly
over trade between Asia and Europe when it helped revitalize the Silk Road. This
put Venice in a very powerful situation. At the height of Venice’s power, not many
states could pose a threat, and even if a state could pose a threat, any conflict would
have hurt them economically. A disruption in trade and goods from Asia was not in
the interest of any neighboring state. Only when Venice and other city-states lost
their leverage over trade did they begin to decline. They were not sustainable with
a weak economy.
A successful city-state’s economy is dependent on trade, so it is imperative
that city-states are able to build relationships with other governments. While a
weak and fragmented local political landscape is important for the beginning of a
city-state, it is equally important for the surrounding nations to partake in trade.
The surrounding nations have to be willing to trade with a city-state. Athens helped
create the League of Delian by which it united Greek city-states under an umbrella
of cooperation. Venice originally had exclusive trading rights with the Byzantine
Empire and controlled the exchange of good between each halves of the known
world. Simply put, the local political landscape of other nations needed to be trade
friendly.
The motivation for surrounding local states to partake in trade usually comes
from necessity and mutual gains. Successful city-states provide a need to global
market by providing a service that is beneficial to other countries. Past city-states
have had a political environment and culture that has created effective institutions

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and practices that can provide large-scale trade. This gives them a comparative
advantage over other larger states. Also, city-states tend to act as a re-exporter of
goods because they do not have large amount of natural resources to trade.
Government
City-states emerge when there is a motivated political and economic elite in
an urban area that come together to create an autonomous state. The form of
government has not been a constant and varies between city-states and time
periods. The government needs to consist of a group of citizens that have ability to
participate in the city-states future. This participation can be politically or through
private business, but the government needs the support of the citizens. The
government does this by providing an environment for economic prosperity, which
raises the wealth for the majority of citizens in the city-states. A similarity between
most successful city-states is that they are accepting of foreigners in some capacity.
Trade inherently is with other states, so a trade based city-state needs to be
accepting of other people. As long as they add to the economic prosperity of the
city-states, the government should be accepting of them. Athens trade was almost
entirely handled by foreigners because citizens thought it was not a respectable job
and they were busy managing the government itself. Venice participated in
business with hated groups in Europe and even allowed them to live in their city
because the economic stability of the city-state was a high priority.
City-states governments need to understand the importance of maintaining a
strong economy and have the ability to create effective policy that benefits a city-

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states’ economic needs. Athens government built a wall that protected access to the
port and Venice maintained a large naval fleet to protect its trading interests. These
are examples of how both city-states held the protection of their economy a priority
and that the government was able to achieve that goal. Effective government
institutions and bureaucracy are also important.
City-sates benefit tremendously from a free market and capitalist system of
government. Athens and Venice’s government worked together with its private
business interests, and in turn they benefited each other. City-states lack natural
resources, so it is important a city-states government creates policies that protect
intellectual capital and innovation. While personal protection of citizens is not
necessary, the government needs to be able to protect the interest of private
business owners. City-states have some form of a capitalist economy. Credible and
enforced property rights are crucial for the development of a capitalist economic
system.54 A strong, transparent, and fair court system is a key tool to protect private
property and business interests. Venice and Athens had different court systems, but
they both contained methods to fight corruption. Athens had large juries and Venice
had multiple judges.
Downfall
Strong city-states all share these three factors that allow them to become
territorial small economic powerhouses. Therefore it is logical that they all shared a
54 Nina Bandelj, and Elizabeth Sowers, Economy and State:A Sociological Perspective.(Cambridge:
Polity Press, 2010), 35.

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similar weakness. Success tends to breed rivals and jealousy. When looking at
Venice and Athens at the height of their power they were not generally well-liked
city-states by neighboring nations. Other states engaged in business with these city-
states out of necessity. Athens can be considered a coercive hegemony that forced
weaker city-states to pay high tributes. Venice gained its enormous amount of
concentrated wealth through a monopoly. These methods were generally not well
received by neighboring states and would leave the city-states in a dangerous place
once their economic advantage ceased to exist.
A city-state’s sovereignty is susceptible to a larger nation-state that has the
ability to absorb the city-state. All previous city-states have been conquered by
more powerful nation-states. All of these city-states fell to a stronger nation-state.
City-states could not compete in the long run with large nation-states that had
access to more manpower, natural resources and territory. The Macedonians
eventually conquered the Greek city-states and would soon there after become a
part of Alexander the Great’s Empire. European city-states were eventually all
conquered by Napoleon Bonaparte. The small size of city-states could not withstand
the force of Napoleon’s vision of nation-states. No city-state has been able to recover
its independence or return to being a city-state once it lost its sovereignty.
Lack of Asian City-States
These fundamental factors that help create city-states, can further be seen in
the lack of Asian city-states. The fundamental building blocks of city-states were
born in the west and were not introduced to Asia until contact with western culture.

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Ironically the long existing divide between the west and the east was ended partly
through the action of Venice, a city-state. The main argument for the lack of Asian
city-states is that they did not develop a strong legal system that protected their
property from the monarchy. The state had all the power and independent
economic enterprises were never able to gain traction because the state had too
much control. Monarchies in Asia saw the rise of a strong middle class as a direct
threat to their power.
Cities in Asia were absorbed by larger states quickly and developed a
relationship that was much more dependent on the rural farmers.55 Merchants,
financiers and artisans never gained enough power to form a cohesive group. Also,
these groups that are city-states largest economic contributors were looked poorly
upon. Confucianism taught that scholars, government officials, handicraftsmen and
even peasants outranked merchants and bankers in social prestige.56 Confucianism
subverted these types of professions from ever expanding because they were seen
as a direct threat and contradiction to Chinese society.
It is logical that a monarchy would see a strong middle class as a threat and
would take steps to limits its potential by creating uncertainty over their personal
property. The legal system in China was not developed with a strong emphasis on
the protection of private property and had too many restrictions on trade.57 The
monarchical government held too much control of daily life and created a system
where citizens were not encouraged to expand and grow beyond the state’s control.

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Any monarchy would fear a strong middle class of merchants and businessmen.
However, these monarchies did not understand that lacking an established class of
these people would put them at a large disadvantage in the soon to come global
economy.
The monarchies that ruled in Asia also stifled innovation by controlling and
limiting education. The invention of Johannes Gutenberg’s printing press in 1450
ushered in a new age of education in Europe. Books became wide spread and
private business owners began to make and sell books. China had invented a
“moveable-type printing”, but the imperial government restricted its use for the
bureaucracy.58 While education is beneficial for a capitalist society that is
competing to dominate in a global market, it is not a priority for, and even a threat
to, a monarchy. Successful Greek and European city-states governments and private
sectors thrived off one another. They are codependent on each other to create a
strong economy.
The first city-states in Asia were founded after World War II. The weakened
European powers could no longer maintain their vast network of colonies and they
all soon gained independence. Colonialism slowly transferred western ideals to
Asia. Some of these fundamental western ideals come from past city-states and they
are essential aspects that make a strong city-state. After exploring aspects of past
city-states that meet these criteria, now I will turn towards current city-states, and
study in closer detail how they possess these determining factors.
58 Thomas F Madden,Venice: A New History, 318.

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Chapter 4: ModernCity-states
City-states are not as prevalent in the modern world and the ones that do
exist have very successful economies through the execution of smart policies. The
era of the great traditional city-states may be in the past, but the city-states that
have emerged in the second half of the twentieth century still share similarities with
old city-states. Hong Kong and Singapore share similar histories during the Colonial
period. This shared history is a huge part of why these countries are both wealthy
city-states.
Hong Kong and Singapore were well-established ports while they were part
of the British Empire. The British used the two colonies as a staging point for trade
with China, Malaya, and the East Indies; they provided distribution, financial
support, transportation, and communication for British trade.59 They had strong
western influences and more importantly influences that can be traced back to
previous city-states. However they gained independence shortly after World War
II. The war had left most of the world devastated and the colonial powers that had
controlled the region for decades could no longer maintain control. Also, the
surrounding countries did not have the ability to absorb these city-states.
Singapore and Hong Kong were given grace periods for their governments to gain
legitimacy and to kick start their economies because of the devastation of World
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Hong Kong and Singapore have achieved high rates of economic growth
through the development of manufacturing industry based on exporting to
competitive world markets. Hong Kong has relied on local business firms,
hardworking people and open government policies that are dependent on free
market forces to provide incentives.60 While, Singapore has depended on foreign
firms (US, European, Japanese) coupled with government policies that have forced
and restricted the market to meet the economic and social goals of Singapore but
without interfering with the competitiveness of the free market.61 The two city-
states have different histories and have developed slightly differently because of
their location and government. However they still have economic similarities. For
example, both engage in re-exporting, resulting in a total volume of trade that is
three times the amounts of their GDP.62 They have the general political and
economic foundations that are essential to maintain a strong trade based economy,
and they have been able to enact policy that can maintained and grow their
economies.
Singapore
Singapore was founded by the British in 1891 as a free port and was slowly
grown over time as a major port and trading center for the British Empire. The city
is strategically located in the Malacca Straits, which is now one of the world’s busiest
62 Edward J. Lincoln, East Asian Economic Regionalism,(New York, NY: Council on Foreign Relations,
2004), 30.

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shipping lanes that connect East Asia to Europe.63 These characteristics would help
set Singapore on a course to become a successful city-state after it gained its
independence. After World War II the British returned and a temporary military
government was installed to maintain law and order until stability and security was
returned to Singapore. Britain intended to prepare Singapore to be a self-governed
and independent democracy. However, Singapore’s road to independence was a
long and uncertain period of time.
Over the course of the next two-decades Singapore began to form political
parties and hold local elections under the supervision of the British.64 Tensions
were high in Singapore due to the racial differences. In September of 1963
Singapore was merged with other territories into Malaysia.65 A group of political
elite in Singapore wanted independence because they were in the minority with in
the new nation-state. They wanted independence to pursue their own economic
goals. As a result, the new nation-state was short lived and after unrest and protest
Singapore was expelled from Malaysia to form an independent city-state in
September of 1965.66 The relationship between the nation-state and the city-state
were very damaged and this forced Singapore’s government to build economic
relationships with other nations.
Singapore was able to restore trade productivity, and social services to their
prewar levels shortly after the war, but it was not able to begin to fully develop its
63 M. Ramesh, "Economic Globalization and Policy Choices: Singapore," Governance, 8.2 (1995): 246.
64 Ernest C. T. Chew, and Edwin Lee, A History of Singapore,(Singapore: Oxford University Press, 1991).
116.
65 Chew and Lee, A History of Singapore,145.

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economy until it gained its independence. Singapore was not unified and
experienced a great deal of volatility and uncertainty, which impeded business
growth. However, independence and new government offered Singapore stability
and a blank slate to builds its economy. The Singapore government understood that
it was in a weak position of weakness, so it started to build a defense force and grow
its economy immediately.67 The Singapore government understood that it would
have to expand on its trade based economy quickly in order to maintain it
sovereignty because it did not have the protection of Britain anymore. The
government played a crucial role in creating a stable environment for international
investment and commerce. It now has a highly developed and successful free-
market economy, but it took effective government policy to build it to the strong
city-state it is today.
Singapore was able to become a developed nation by attracting foreign direct
investment and using it to grow their economy. It is important to note that the city-
state’s foreign economic policy was driven by the public sector more then the
private sector; this made the government the most important and independent
variable for this type of foreign economic policy.68 The government elite had a very
strong interest in controlling economic policy, so they could alter it to meet the
needs of the city-state above private business owners. The policies were meant to
benefit citizens by raising the living standard. Singapore was able to successfully
68 Christopher M. Dent, "Singapore's Foreign Economic Policy: The Pursuit of Economic Security."
JSTOR. Institute of Southeast Asian Studies (ISEAS), (2001): 2.

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combine an active macroeconomic management approach with the incentives and
pressures of market forces to raise employment and increase income. 69
Singapore’s state driven policies have been the most important factor in
shaping Singapore’s economy and the polices have been very successful.
Singapore’s total trade increased by almost twenty-one times, from 12.3 billion to
257 billion Singapore dollars, between 1970 and 1993, and its share of total gross
domestic product accounted for by exports increased from 101.6 percent in 1965 to
134 percent in 1993.70 Singapore’s government has increased the economic output
of the city-state in a very short amount of time. Its first set of economic policies
attracted foreign investors by maintaining low labor costs, industrial peace and
discipline, industrial infrastructure, and low taxation. Some specific examples of
strong political intervention is legislation that prevented unions from going on
strike, banned collective bargaining rights, increased working hours, decreased the
number of public holidays and rest days, and restricted sick leave and annual paid
leave.71 The government put the larger goals of the city-state above the citizens’
personal needs. This really highlight that the government was able to push past
short-term discomforts in the pursuit of long term goals.
“Singapore is often described as a global city-state in the commercial
tradition of ancient Greek or medieval Italian city-states, such as Venice.”72 Here is a
direct comparison to past city-states and how the same idea of depending on global
trade for a strong city-state has lingered throughout history because it is a proven
70 Ramesh, "Economic Globalization and Policy Choices: Singapore," 244.
71 Ramesh, "Economic Globalization and Policy Choices: Singapore," 246.
72 Dent, "Singapore's Foreign Economic Policy”, 2.

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and successful model. Singapore has created tax incentives that promotes foreign
business to extend their business to Singapore, and at the same time gives tax
incentives to domestic companies to relocate production abroad.73 The city-state
has really committed itself to the global economy because the global economy is
responsible for its success. The city-state is dependent on a stable international
economy, so the city-state’s general security is linked to the international economy.
Singapore’s government just needs to continue to adapt and have the ability to
design policy that will maintain their relevance in the world economy in order to
secure it sovereignty.
The British influence in Singapore were well integrated into the society, so
many of the political institutions were directly copied from British political
institutions. The judicial system in Singapore is based upon the British courts
system, but trial by jury was abolished in the late 1960s.74 This is interesting
because a fair and transparent court system is attractive to foreign investors and
protects business interests. However, the government around the same time was
creating legislation that was unpopular and in order to maintain their control on the
economic welfare of the country the political elite reformed the judicial system to
favor their agenda.
Singapore adopted a parliamentary system of government that has a formal
written constitution. However, the government did not function as a genuine
democracy. It is not a total autocracy and has become more democratic as its
economy developed. The government is still generally responsive to the will of
73 Ramesh, "Economic Globalization and Policy Choices: Singapore," 246

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citizens, but is more of a carefully controlled democracy. A one party system
emerged with the People’s Action Party taking control of the government; Lee Kuan
Yew was the leader of this party and was Prime Mister until 1990. 75 The party’s
authoritarian qualities invade citizens’ personal lives and closely monitor members
of the opposition party’s finances and personal lives.76 Although authoritarian rule
is not generally conducive with a capitalist society, the PAP was extremely focused
on the growth of the economy and fostering an environment that encourages
international investment and trade. Singapore has used economic policy and
international trade to create one of the few successful and truly independent city-
states in the modern world.
Hong Kong
Hong Kong has never truly been an independent city-state. After World War
II it returned to the British as a colony and then in 1997 it was turned over to the
People’s Republic of China. However, it still has many of the characteristics of a
city-state and has had a very influential local government, an important factor for
city-states economic success. The British increasingly played a smaller and smaller
role in the governing of Hong Kong after World War II. Prior to the arrival of the
British, Hong Kong was a small fishing community in the South China Sea.
After World War II Hong Kong returned under British rule and the civil
government resumed control. Asia was free of Japanese authoritarian rule and the
Allies used military occupation to stabilize the region. With the exception of China,

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the region’s nations were rebuilding government and local economies. Hong Kong
was able to recover quickly after the Japanese occupation because of the
“entrepreneurial spirit” of Hong Kong citizens and by quickly resuming its role of
servicing trade to and from China.77
The rise of the Communist party in the mainland of China drastically changed
the dynamic of Hong Kong’s economy. This change in dynamic influenced Hong
Kong development for the next two decades. Hong Kong was under serious threat
because the cold war economically and politically isolated China from Western
nations by the use of western trade embargoes against China. In 1950 China
accounted for 32 percent of Hong Kong’s trade, and in 1959 it fell to 5 percent.78
Hong Kong’s entrepreneurs shifted to industrial production to make up for the loss
in trade with China. Britain had a political incentive to keep Hong Kong out of
China’s reach, so they allowed Hong Kong businessmen to pursue any business
ventures.
Manufacturing took off in Hong Kong and became a valuable resource to the
city-state. Industrialization reinforced and propelled Hong Kong’s trade based
economy into the future. Industrialization used Hong Kong’s well-established
infrastructure to create new trading partners and trade the goods they were
manufacturing.79 The government had little direct involvement in Hong Kong’s
economic change. The government allowed the private sector to adapt by providing
a capitalist friendly environment. When the Hong Kong local government gained
77 Steve Tsang,A Modern History of Hong Kong, (New York City, NY: I.B. Tauris & Co, 2004) 161.
78 Steve Tsang, A Modern History of Hong Kong,164.
79 Steve Tsang,A Modern History of Hong Kong, 166.

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more independence it took steps to continue the growth and maintenance of the
city-state’s infrastructure.
Economic development requires solid infrastructure to support economic
growth. In the case of Hong Kong there is interaction between the public and
private sectors. Public capital enhances the productivity of private capital, and this
raises the rate of return for the private and public sector and encouraged more
investment.80 Hong Kong policies have taken advantage of its location to help build
it into one of the busiest shipping ports in the world. The Hong Kong government’s
biggest role is in providing a sound and stable investment environment, supported
by a consistent regulatory framework and a low tax structure.81 Hong Kong has used
the free market to ensure that it remains competitive. For example, there are no
restrictions on foreign contractors in the construction markets.82 The government
had the foresight and ability to seek the best contractors for its infrastructure
because high quality infrastructure will pay off in the long run. Using domestic
companies would be a short-term gain; poor quality infrastructure could slow down
trade and this could slowly lessen trade within the country. Again, economic
stability is essential to a city-state with little natural resources.
Hong Kong made another economic shift when its industrial production
slowed down by diversifying its economy. In the 1980s the government used its
already existing network of educated citizens, banks, shipping and insurance
agencies to develop Hong Kong into a major business service sector hub for
80 R. Y C Tse, and John Raftery, "Infrastructure Policy and Economic Growth: Case of Hong Kong,"
AJCEB Australasian Journal of Construction Economics and Building, 1.1 (2001): 66.
81 Tse and Raftery, "Infrastructure Policy and Economic Growth”, 68.
82 Tse and Raftery, "Infrastructure Policy and Economic Growth”, 67.

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international business. 83 This was done by a joint effort of private investment and
government polices that encouraged the growth of the service sector. Hong is still a
major shipping city-state, but modern trade has evolved past the shipping of
tangible goods. Hong Kong has been accepting of foreigners because they add to
the economic interest. Hong Kong has a very strong relationship with foreign
investors. In 1999 foreign direct investment accounted for 60 percent of Hong
Kong’s gross domestic capital formation, which was the highest in Asia.84 Hong
Kong is an attractive investment for western nations because of the western
influence from Britain.
The British influence in Hong Kong was so deep that many of the political
institutions were directly copied from British political institutions. Most important
is the influence of the British judicial system. Hong Kong has the influences of a
British judicial system that provided stability and security; this allowed Hong Kong
to flourish as a center for international trade and commerce because business
entrepreneurs had a solid court system to protect their investments.85 The British
influenced judicial system was comparable to Brittan’s own judicial system. This
was a big concern when Hong Kong merged with the People’s Republic of China.
China does not have a strong and transparent judicial system and the very idea of
“rule by law” is western by nature and is not a familiar practice in China.86 Rule of
law is an essential for city-states. Hong Kong could not risk losing foreign investors
because their investment would not be protected under Chinese rule. Hong Kong’s
83 Steve Tsang,A Modern History of Hong Kong, 175.
84 Lincoln, East Asian Economic Regionalism, 34.

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local government managed to maintain their judicial system because it was in
China’s best interest to maintain Hong Kong’s economic stability, so the region did
not become a drain on the state.
The transition of Hong Kong from British rule to Chinese rule has been
relatively smooth. The local government under both rulers has played a vital role in
maintaining economic stability and growth. Hong Kong citizens have managed to
overcome constant change and adapted their policies and economy to meet the
demands of the global market.
Future
Ancient Greek and then Italian city-states were absorbed into larger
countries and have left a significant impact on how western society functions. Past
city-states have all experienced the same ending of being absorbed by larger nation-
states. Singapore is still an autonomous state and Hong Kong is a semi-autonomous
state and both are very economically successful. However, they could still suffer
similar fates of past city-states. The value of the city-states rests in maintaining
their current governing body and business elite to continue to drive economic
growth and success. Hong Kong and Singapore have established infrastructure and
ports that have value by themselves, but the main resource of a city-state is its
intellectual capital that runs and maintains the economy. The hostile takeover of a
city-state or any nation would most likely disrupt the economy and destroy the
intellectual capital, which is the foundation of a city-states economy. History has
shown that nation-states conquer city-states when the city-state is declining in

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power and their military and economic strength is generally greater than the city-
state.
Hong Kong and Singapore’s future is uncertain. History would suggest that
the two city-states would eventually be conquered or dissolved into a larger state.
However, the world is a very different place and globalization has also put Hong
Kong and Singapore in uncharted territory for city-states. Since the formation of
these city-states the local political landscape has changed drastically. Globalization
has had a huge impact on every nation, and has drastically changed the political
dynamic between nations in a very short span of time. Wide spread free trade and
international markets have largely been responsible for the drastic shift in the
world economies and political institutions. Hong Kong and Singapore’s reliance on
foreign trade leaves them vulnerable to global financial market volatility or a
slowdown in the global economy.87 Hong Kong and Singapore’s financial security is
dependent on the stability of other nations economies.
Many of the larger countries surrounding them transformed from colonies
with little independence into nation-states and they can be used to describe a
majority of nations in the world. A nation-state is a combination of tangible and
conceptual bonds that unite people under a common identity and a single flag. “The
modern nation-state is a group sharing a common history, identity, and culture, with
87 "Hong Kong," Central Intelligence Agency, (December 20, 2015), Accessed December 21, 2016.
https://www.cia.gov/library/publications/the-world-factbook/geos/hk.html.

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47
a monopoly on the legitimate use of force linked to a specific territory recognized as
sovereign by other nation-states.”88
A nation-state is built on two fundamental principles. The first principle is an
abstract one that refers to a shared culture, values and a desire for political self-
determination shared by a group of people. Nationalism is a psychological bond
towards an imagined community that can be shared by people of different race, age,
class, religion, and gender.89 A fundamental aspect of nationalism is that everyone
equally belongs to the imagined community. The roots of the imagined community
come from a collective memory. Each nation-state has a unique collective memory
because they each have a different history. The second and more tangible principle
is the governing body that comprises of laws and policies that guide the nation. “The
state is not a single entity but a network of originations; government, bureaucracy,
military and police, and judiciary.”90 These are all institutions of authority that have
legitimacy because they are recognized by a majority of the people. Citizens
recognize these institutions of authority because they are a part of the shared
community and the institutions are in place to manage and protect members of the
nation-state.91 These institutions are the structure of the nation-state and give a
society structure and order. The “state” and the “nation” are dependent on each
other to make a nation-state.
88 Betty Dobratz, Lisa K Waldner, and Timothy Buzzell. Power, Politics, and Society: An Introduction to
Political Sociology, (Boston, Massachusetts: Rutledge, 2012), 37.
89 Dobratz et al., Power, Politics, and Society, 43.

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48
This development is important and relevant to current city-states. Greek and
Italian city-states were all surrounded and developed with other city-states. Hong
Kong and Singapore are arguably the only city-states in Asia. Hong Kong and
Singapore were surrounded by weak nation-states for a brief but critical amount of
time. Now they are now surrounded by large nation-states. They never developed
at the same time multiple city-states. These city-states clearly have separate
governing bodies that define each state, but the difference in the collective identity
that manufactures nationalism in the surrounding nation-states is less clear. Before
the colonization of Hong Kong and Singapore residents shared a similar culture with
the people that are residents of neighboring nations. This is an uncommon
framework for city-states to exist in and could result on never before seen outcomes
of city-states.
Singapore is currently not under any direct threat of being absorbed or
conquered by a neighboring power. However, that does not mean its sovereignty is
secure. Singapore is completely surrounded on land by Malaysia and only half a
century ago seceded from the young nation-state. However, after years of being a
city-state it has become a melting pot of people that speak different languages,
practice different religions, and have different ethnicities. Singapore has four
official languages Mandarin (spoken by 36 percent of population), English (spoken
by 29 percent of population), Malay (spoken by 12 percent of population), and
Tamil (spoken by 4.4 percent of the population).92 Singapore’s residents’ ethnicities
comprise of 74 percent Chinese, 13 percent Malay, 9 percent Indian, and 3 percent
92 “Singapore,” Central Intelligence Agency,(December 18, 2015), Accessed December 21, 2015.
https://www.cia.gov/library/publications/the-world-factbook/geos/sn.html.

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49
other.93 Finally, 34 percent practice Buddhism, 17 percent practice Christianity, 14
percent practice Islam, 11 percent practice Taoism.94 Over Singapore’s history it has
become an extremely diverse city-state.
However, people within the city-state are generally able to live in peace and
partake in the economic prosperity in the city-state. There is clearly not a deep or
long cultural connection between the citizens of Singapore. The strongest glue of
the city-state is the shared economic interest and the state itself. As long as the city-
state is able to provide safety and economic stability for its citizens, it will be able to
remain independent. History tends to repeat its self, but there is really no way to
know how Singapore or the world will change.
Hong Kong could be the first example of a larger nation-state, The People’s
Republic of China, successfully integrating a city-state by maintaining its strong
economic value. Hong Kong reverted to control of the People’s Republic of China in
1997. However, Hong Kong still has managed to remain somewhat independent
from China. In the agreement that returned Hong Kong to China, China agreed to a
“one country, two systems" blueprint. Where China's socialist economic system
would not be implemented in Hong Kong and that Hong Kong would maintain a
"high degree of autonomy" except in the area of foreign policy and defense until the
year 2047.95 They have some serious and crucial differences across a broad range of
types of issues: different fundamental economic systems, political systems, and
cultural norms.
93 “Singapore,” Central Intelligence Agency.
94 “Singapore,” Central Intelligence Agency.
95 Tony Saich, Governance and Politicsof China, 3rd ed (New York City, NY: Palgrave Macmillan, 2011)
180.

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50
China’s population in July of 2015 was 1.4 Billion people and its GDP per
capita in 2014 was 13,300 dollars.96 While, Hong Kong’s population in July of 2015
was 7.1 million people ands its GDP per capita in 2014 was 55,100 dollars.97 This is
partly due to their focus on different types of economic growth. Hong Kong is a
valuable city-state, and it is logical that China wants to integrate their economy with
Hong Kong’s. However, it is also logical that the political and economic elite are
trying to resist the integration of the state. Understandably they are wary of losing
local power and influence to the government based in Beijing. China is a communist
state and does not have some of the government institutions that have allowed city-
state’s to prosper economically.
Even though Hong Kong is now technically part of the People’s Republic of
China it still maintains a level of independence from the rest of China. Hong Kong is
already successful and has an affluent class of people that are able to resist authority
more because they already have power. China is not willing to drastically challenge
this group because it could disrupt the economy in the region, which would be more
damaging than useful. The People’s Republic of China is currently slowly absorbing
Hong Kong. The government is trying to integrate the RMB into Hong Kong slowly
and the Chinese government is lowering restrictions for entering and the number of
visitors from the mainland has increased from 4 million in 2004 to 47 million
visitors.98 The large nation-state has an arguable claim to the land, but they have
developed different cultures over the time they were split apart. However, the slow
96 "China," Central Intelligence Agency. (December 18, 2015), Accessed December 21, 2015.
https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html.
97 "Hong Kong," Central Intelligence Agency.
98 "Hong Kong," Central Intelligence Agency.

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51
absorption of the city-state could help maintain the economy of Hong Kong while
bringing it more under control. It will be interesting to see if Hong Kong will be able
to continue to maintain economic stability under the growing pressure from China.

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52
Chapter 5: The Evolutionof City-States
“The city-state is an old form of macro-social organization that is rare in the
Modern World.”99 . A strong trade based economy, effective government, and the
inclusion of majority of citizens in participating in the city-states economy have all
lasted over the city-states two thousand history. Over time city-states have held
onto core principles throughout history, but they have also evolved their internal
system of governments and economic policies. City-states are not common and
current ones exist in a very different environment then previous city-states. City-
states still do exist and they have done so by evolving to fit into the current world
environment.
Partial Democracy
Athens’ made the first step to create a strong model for a city-state by
pioneering ideas of citizenship and general democratic values that outlasted the
city-state. Now looking at Hong Kong and Singapore they have held onto the idea of
citizenship, but they show very little democratic characteristics. Over the three
periods of city-states that are examined in this paper, democratic values have
declined. This directly contradicts the general evolution of traditional nation-states
becoming more democratic over the course of history. Ancient city-states allowed
small groups of people to develop and practice the use of democracy because they
were not ruled by a larger and imposing empire or nation-state. This leads to the

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53
perplexing question of why are modern city-states governments more authoritarian
in nature?
Democracy was born in a city-state because small groups of people were able
to see the value of equality in a society and that democracy helped foster the strong
economy because it incentivized private businessmen. In the case of Athens and
Venice democratic values generated positive qualities that defined the states legacy,
but democratic values sometimes proved to be a hindrance and a threat to the well-
being and sovereignty of the city-state.
Democracy hurt Athens during the Peloponnesian War because the slow
moving democratic government could not take decisive action to preserve the city-
state. These democratic principles transferred to the next generation of city-states
in Italy. As the Italian city-states expanded in power and influence they began to
lose their democratic character and capitulated to dynastic rule.100 This decline in
democratic values coincides with increasing conflicts with other states. The
Venetian government could not afford to capitulate to the masses in times of
conflict; they deliberately made decisions that angered a majority of citizens. As
stated in chapter two, the government allowed Jews to live in Venice for a very steep
price in a time of conflict to benefit the state. If Venice had been more democratic,
this policy might not have been implemented, and Venice’s economy would not have
suffered as much. Democracy can carry the baggage of visceral hatred, which can
interfere with economic policy.

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54
Democracy is not always an effective form of government and can be slow
and counterproductive. Large democratic nation-states have the luxury of slow
government and can afford to have an extended period of slow economic growth.
Neighboring nation-states are less likely to absorb or attack a nation-state that has a
weak economy as compared to a weak city-state. City-states are small and generally
share similar cultures and speak the same language as other city-states. They have
small populations and most of the cities have strategic locations for trading.
Therefore, it could be more tempting to absorb or conquer a city-state because the
risk is generally lower than a larger nation-state. A strong economy is the
foundation of a city-state. They do not have the manpower or natural resources to
compete with large nation-states. If the economy falters a city-state’s sovereignty is
at great risk.
This could suggest a number of norms about the evolution of city-states.
Economic growth is the priority and many of these nations started at a huge global
disadvantage. They did not have the luxury of slowly growing their economy
because technology has shrunk the world and accelerated economic growth.
Singapore and Hong Kong have limited democracies. They have only both kept the
democratic institutions from the influences of colonialism that ensure a strong
economy. Their economic growth has been dependent on positive trade relations
with western nations, so it is important for them to resemble their trading partners
to increase their legitimacy. Democratic institutions help provide fundamental
capitalist business practices, but they also attract foreign investors because they can
relate to western democratic institutions. Modern city-states need a fast pace

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55
government without democratic due process and transparency to guide and control
the large-scale economic goals. Economic freedoms are still strong in Singapore and
Hong Kong, however the government strictly controls personal freedoms and
freedom of speech. These social freedoms could impede and slow down the
government’s ability to take action on economic investment.
These modern city-states have learned that democracy on a small scale is
important and strong enough to protect the state from being absorbed by
surrounding larger nations. The strong economy may be the most important factor
that protects a city-state’s sovereignty. City-states’ history has indicated that ideal
democracies are not as important as state sovereignty. City-states have learned to
focus on protecting economic freedoms and empowering citizens to pursue
bettering their lives through success in business.
Globalization
The Modern world has made it easier to partake in global trade. After the fall
of European Empires Hong Kong and Singapore have adapted to work with
international institutions that promote the spread of free trade and markets.101
Many of the institutions that were unique to past city-states are widely adopted by
most the world’s nations. International institutions were created after World War II
and they have legitimacy. The United Nations, World Bank, World Trade
Organization, and International Monetary Fund are all international institutions that
101 Miguel Angel Centeno, and Joseph Nathan Cohen, Global Capitalism: A Sociological Perspective,
(Cambridge: Polity Press, 2010), 40.

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in some capacity help promote global stability politically or economically. Modern
City-states have used these to their advantage.
The United Nations International Law of the Sea has been particularly helpful
to city-states and has changed how they protect their economic interests. Athens
and Venice had to become maritime powers in order to protect their ability to trade.
This is not a big issue for Hong Kong and Singapore. The modern world is a
relatively fair and friendly place for trade compared to the periods of the city-states
of Athens and Venice. Singapore and Hong Kong have not personally had to secure
shipping routes, which is a huge part of their economy. Unlike Venice and Athens,
they do not have to financially and fiscally protect their trade routes.
In the past few centuries freedom of the sea was generally becoming a more
accepted practice, but only until the formation of a international institution, the
Untied Nations, was it formally accepted a by majority of the worlds nations. The
Law of the Sea provides clear guidelines for how states should manage trade, the
environment, maritime borders, and ocean resources. The Law of the Sea states that
foreign ships may exercise the right of innocent passage through territorial sea
through the use of sea-lanes. 102 Also it explicitly states that no states shall interfere
with shipping routes.103 The Law of the Sea permits that all straits no matter their
location should be treated as international waters because of their strategic value to
military mobilization and economic trade.
102"United Nations Convention on the Law of the Sea," (United Nations: December 17, 1970), 37.
Accessed December 21, 2015.
http://www.un.org/depts/los/convention_agreements/texts/unclos/unclos_e.pdf.
103 "United Nations Convention on the Law of the Sea," 121.

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57
A global community is invested in maintaining trade because they partake in
the global trade. Therefore, the global powers spend resources to ensure their
trading interest is maintained. This is ideal for city-states because their main vital
economic interest has greater security. The rest of the world has finally copied the
city-state’s two thousand year old government and economic model. Past city-
states’ economies, governments and philosophies have had a big influence on the
formation of the global community and economy. And in turn the city-states have
been able to adapt fairly well in the current world.

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Conclusion:
City-states have had a long history and a very important role in shaping the
world is current governments, economies, and cultures. City-states are relatively
small in size and population but have had enormous impact on the world. The first
democracy was created in the setting of a small city-state over two thousand years
ago. Athens cultivated an environment where some of modern societies most
beneficial tools were developed. This first city-state created a legacy that would be
continued by other city-states that developed new societal, political, and economic
ideas on top of old ideas.
Crucial aspects of modern society were developed in city-states. The first one
is the development and definition of citizenship. This simple idea allowed people to
participate and feel more connected to their community because they were benefits
by being a citizen. Citizenship is used in all nations around the world today. City-
states also fostered an environment that allowed people to become entrepreneurs
and build private businesses. Another key tool developed in city-states was the
power of a well-run trade based economy. Many of the widely used and practiced
methods that were the basis for economic growth can be traced back to city-states.
Trade was not invented by city-states, but city-states brought trade to new heights.
City-states have created more wealth then larger nations through trading and
developing intellectual capital rather than depending on natural resources. City-
state governments developed a strong relationship with a trade economy by
creating institutions, infrastructure, and policies that helped the private citizens
build and grow their businesses.

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There is limited research that looks at the development of city-states
overtime. There is a great deal of research of each individual city-state. Not many
scholars have tried to explain city-state development throughout history. Future
researchers should follow the pattern of city-states more closely and not just focus
on a single period of city-states.
City-states have had a significant impact on the world because they
developed new ideas on a small-scale level and these ideas spread throughout other
cultures and nations. Many of their collective contributions and original ideas are
widely used and practiced through the modern world. There are few city-states in
the world today and their future is uncertain. However, they could continue the
legacy of city-states by creating new ground breaking economic, political, or societal
change that will take root after they are no longer around. Only time will tell.

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