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Smart City Governance in Developing Countries: A Systematic Literature Review

Si Ying Tan, Araz Taeihagh

arXiv:2001.10173v1cs.CYecon.GN

TL;DR

Developing-country smart city initiatives face population, infrastructure, financial, informal-economy, and governance pressures, while evidence on their distinct development remains fragmented. This paper systematically reviews the literature and finds that technology-enabled smart cities require concurrent socioeconomic, human, legal, and regulatory reforms, adapted to local conditions.

  • Problem

    The review addresses fragmented knowledge about how smart cities are conceptualised, why governments pursue them, and which drivers and barriers shape development in developing countries.

  • Method

    The authors conducted a systematic literature review using Scopus and Web of Science, extracting and thematically synthesising evidence on smart city development.

  • Results

    Technology-enabled smart cities in developing countries require concurrent socioeconomic, human, legal, and regulatory reforms, with implementation shaped by local contextual conditions.

  • Takeaways & Limitations

    Smart city governance should combine digital infrastructure with basic development, human-capital, regulatory, inclusion, sustainability, participation, start-up, and partnership efforts.

  • Takeaways & Limitations

    The review includes grey literature because rigorous empirical research on smart city development in developing countries remains limited.

Abstract

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Smart cities that make broad use of digital technologies have been touted as possible solutions for the population pressures faced by many cities in developing countries and may help meet the rising demand for services and infrastructure. Nevertheless, the high financial cost involved in infrastructure maintenance, the substantial size of the informal economies, and various governance challenges are curtailing government idealism regarding smart cities. This review examines the state of smart city development in developing countries, which includes understanding the conceptualisations, motivations, and unique drivers behind (and barriers to) smarty city development. A total of 56 studies were identified from a systematic literature review from an initial pool of 3928 social sciences literature identified from two academic databases. Data were analysed using thematic synthesis and thematic analysis. The review found that technology-enabled smart cities in developing countries can only be realised when concurrent socioeconomic, human, legal, and regulatory reforms are instituted. Governments need to step up their efforts to fulfil the basic infrastructure needs of citizens, raise more revenue, construct clear regulatory frameworks to mitigate the technological risks involved, develop human capital, ensure digital inclusivity, and promote environmental sustainability. A supportive ecosystem that encourages citizen participation, nurtures start-ups, and promotes public-private partnerships needs to be created to realise their smart city vision.

1. Introduction

Smart cities are widely promoted as development visions, but their meaning and governance are especially complex in developing countries. This review consolidates literature on their conceptualisations, motivations, drivers, and barriers.

  • Smart cities have become widely adopted political and development visions, shaped by technological innovation and cities’ demand for greater efficiency and sustainability.
  • Definitions remain heterogeneous, although technological applications such as sensors, big data analytics, and the internet of things are salient components.
  • Existing smart city governance research has mainly examined developed economies through implementation experiences, policy mechanisms, transformation processes, drivers, barriers, and assessment metrics.
  • Developing-country conceptualisations are likely murkier because digital governance intersects with social justice, politics, ideology, legality, and regulation.
  • Rural-to-urban migration is expected to intensify ecological, social, and infrastructural pressures in major developing-country cities, motivating systematic evidence consolidation.
  • The review integrates interdisciplinary evidence to examine how smart cities are defined, why governments pursue them, and which context-specific drivers and barriers shape development.

2. Methods

The study systematically searched and screened social-sciences literature on smart city development in developing countries. It extracted thematic information on definitions, goals, drivers, and barriers for synthesis.

  • 2.1. Search Strategy: The search combined two keyword strings covering smart cities and developing countries across Scopus and Web of Science.
  • 2.2. Inclusion and Exclusion Criteria: Studies were limited to publications from 2009 to 2019 and included empirical, conceptual, review, book-chapter, and conference-proceedings research.
  • 2.2. Inclusion and Exclusion Criteria: The review excluded studies focused solely on developed countries, analogous concepts without explicit developing-country relevance, or isolated technology and environmental outcomes lacking broader context.
  • 2.2. Inclusion and Exclusion Criteria: After duplicate removal, title-and-abstract screening, and full-text assessment, studies were examined for fit with the review scope.
  • 2.3. Data Collection, Data Extraction, and Data Analysis: A structured extraction framework captured study methods, objectives, definitions, dimensions, goals, drivers, and barriers, which were analysed using thematic synthesis.
  • 2.3. Data Collection, Data Extraction, and Data Analysis: The authors used repeated discussions and consensus to establish search strategies, the review scope, and extraction and analysis decisions.

3. Results: Smart City Conceptualisations and Motivations in Developing Countries

The 56 included studies portray smart cities in developing countries as technology-enabled but inseparable from sustainability, human development, institutional reform, and inclusive public-service objectives. Governments primarily pursue these initiatives to improve service delivery and citizens’ quality of life.

  • 3.1. Study Contexts and Characteristics: 56 studies across 12 countries and three continents were included after the review’s evidence search and screening.The studies covered Asia, Africa, and Eastern Europe.
  • 3.1. Study Contexts and Characteristics: The literature comprised policy or development-process analyses, citizen and expert surveys, and theoretical or conceptual studies.
  • 3.2. Conceptualisations of the Smart City in the Literature: 14 studies conceptualised smart cities in developing-country contexts, almost unanimously identifying technology-enabled digital services as a key characteristic.
  • 3.2. Conceptualisations of the Smart City in the Literature: Smart city conceptualisations also connect intelligence with sustainability, requiring physical and social environments to improve together and reduce environmental impacts.
  • 3.2. Conceptualisations of the Smart City in the Literature: Technology-enabled smart cities require concurrent social, economic, ecological, political, human-development, legal, and regulatory conditions rather than technology alone.The review specifically highlights process redesign, political support, organisational transformation, knowledge, skills, participation, and smart institutions and laws.
  • 3.3. Motivations for Smart City Development in Developing Countries: Governments pursue smart city development to improve public-service efficiency and citizens’ quality of life, while also including vulnerable and disadvantaged populations.Reported mechanisms include reduced transaction costs, improved information structures, data-informed service monitoring, and attention to structural injustice and informal-sector populations.

4. Drivers of Smart City Development in Developing Countries

Smart city development in developing countries is driven by technology, financing, regulation, human capital, citizen participation, private-sector involvement, and innovation ecosystems.

  • Eight drivers propel smart city development, including technology, economic and financing capacity, regulation, human capital, citizen engagement, and private-sector participation.The review presents these drivers as mutually supporting elements of a supportive ecosystem.
  • Government financing capacity is pivotal because developing countries require conventional and innovative instruments to fund smart city capital investments.Examples include property taxes, vacant land taxes, development impact fees, betterment charges, and congestion charging.
  • Clear, transparent regulation builds citizen trust and investor confidence while addressing privacy and security risks from IT-enabled services and IoT data.The review identifies privacy laws and transparent institutions as necessary components of the regulatory environment.
  • Technology and infrastructure readiness provides the physical foundations for smart city initiatives and can improve operational efficiency, online transactions, public services, and resource management.Relevant systems include secure wireless infrastructure, information-sharing platforms, and integrated e-government portals.
  • Human capital requires technically competent citizens and government personnel capable of implementing, operating, and securing IT-enabled services.Technical capacity spans data collection, integration, management, analysis, and information provision.
  • Economic stability attracts financial and human capital, while active citizen participation requires empowerment, digital inclusion, collaborative governance, behavioural change, and benefits sharing.Citizen empowerment includes awareness, ownership, inter-sectoral relationships, and feedback throughout policymaking.
  • Private-sector participation complements government financing, mentoring, and incubation roles, while supportive ecosystems use incubators and policy experimentation to promote innovation and learning.Public–private partnerships and start-up incubators are presented as mechanisms for testing and scaling new ideas.

5. Barriers to Smart City Development in Developing Countries

Developing countries face distinctive barriers to smart city development, especially financing constraints and the high costs of projects and infrastructure.

  • The review identifies 10 social, economic, environmental, political, and regulatory barriers that must take precedence before smart city visions can be realised.These barriers are described as fundamentally different from those facing developed countries because of existing socioeconomic challenges.
  • Budget constraints and financing issues restrict governments’ ability to develop smart cities despite projected longer-term cost effectiveness.Fiscal fragmentation and dependence on state or central governments can further constrain developmental funding.
  • Smart city projects can impose astronomical costs on governments and citizens, while uncertain profitability can undermine their financial viability.China’s Dong-tan eco-city project was estimated at around $1.3 billion USD and was unlikely to be funded by business or government alone.

5.2. Lack of Investment in Basic Infrastructure

Insufficient basic and digital infrastructure constrains smart city adoption in developing countries, leaving governments unable to meet essential service needs or ensure equal access.

  • Lack of investment and maintenance in water drainage, sewerage, waste collection, and other basic services holds back smart city development.Population pressure can make underground sewerage and drainage systems unsustainable, while slum areas may experience uneven, low-quality infrastructure.
  • Low internet penetration and unequal digital access constrain smart city development among households and populations in cities such as Ahmedabad.Technology-related infrastructure readiness is heterogeneous across developing countries.
  • Costly internet services can slow information exchange, while limited local technical capacity can impede development of core smart city technologies.The review cites Ghanaian transport systems and China’s technology development as examples.

5.4. Fragmented Authority

Fragmented authority and weak governance safeguards impede coordinated smart city development and leave data-related risks insufficiently regulated.

  • Fragmented authority across public institutions complicates coordination among the public and private stakeholders involved in smart city development.The review emphasises the need for strong partnerships and a central authority with a unifying strategy.
  • Many developing cities lack governance frameworks that specify smart city policy objectives, development strategies, regulatory norms, and evaluation models.The absence of clear frameworks can accompany rapid smart city adoption motivated by socioeconomic gains.
  • Privacy and security safeguards remain a major concern as network integration and big-data analytics increase informational risks for citizens.The review identifies data privacy and security breaches as concerns across different countries.
  • In African satellite-enhanced telemedicine and e-health, patient-data ownership, security, and access to clinical information systems remained vague and unregulated.The example illustrates how unclear safeguards can affect both patients and care providers.

5.6. Lack of Skilled Human Capital

Developing-country smart city projects face a major shortage of skilled human capital across citizens, bureaucrats, and planners. This shortage limits the capacity to perform technology-enabled roles and support implementation.

  • Skilled human capital is a major barrier to smart city development in developing countries.The review identifies shortages among citizens, bureaucrats, and planners.
  • Missing capabilities include formal ICT skills among citizens, technology-related skills among bureaucrats, and technical knowledge among planners.
  • These skills gaps constrain the human capacity required for technology-enabled smart city functions.

5.8. Environmental Concerns

Smart city development in developing countries creates environmental pressures through rapid urbanisation, unplanned settlements, congestion, pollution, and resource-management problems. Municipal capacity constraints can further undermine environmental sustainability.

  • Environmental issues are among the most challenging consequences of large-scale smart city development in developing countries.Sudden ecological stress is associated with substantial rural-to-urban migration.
  • Rural-to-urban migration can produce unplanned settlements, congestion, pollution, and resource-allocation problems.
  • Over-extraction of groundwater, toxic discharges, and inefficient waste management place additional pressure on environmental sustainability.In Bharatpur, limited personnel, infrastructure, and route planning contributed to improper dumping and open burning.

5.10. Technology Illiteracy and Knowledge Deficit among the Citizens

Technology illiteracy and citizen knowledge deficits obstruct smart city development in developing countries. They limit technology uptake, scaling, network effects, and the efficiency of information and service systems.

  • Technology illiteracy and citizen knowledge deficits are major obstacles to realising smart city visions, especially in lower-HDI countries.
  • Limited technology knowledge can hinder adoption, scaling, and the positive network effects that depend on a large literate user base.

6. Discussion

The review finds that smart city governance in developing countries differs fundamentally from that in developed countries and must be adapted to local developmental conditions. Realisation requires socioeconomic, regulatory, human-capital, inclusion, participation, environmental, and ecosystem reforms.

  • 6. Discussion: The review identifies fundamental governance differences between developed and developing countries, including ten barriers tied to developmental challenges.Their relevance varies across cities according to institutional and contextual conditions.
  • 6. Discussion: Digital technologies become meaningful only when pursued alongside socioeconomic development and regulatory reforms.
  • 6. Discussion: Smart city planning should reflect local affluence, economic profiles, skilled human capital, technology literacy, bureaucratic efficiency, and policy capacity.Cities within the same country can have substantially different developmental conditions and infrastructure needs.
  • 6.1. Policy Implications for Smart City Governance in Developing Countries: Governments should prioritise electrification, sanitation, clean water, and roads where basic infrastructure needs remain unmet.
  • 6.1. Policy Implications for Smart City Governance in Developing Countries: Smart city development requires diversified and innovative financing because competing priorities create government budget constraints.Suggested approaches include land-based financing, congesters-pay mechanisms, and metro-plus-property development.
  • 6.1. Policy Implications for Smart City Governance in Developing Countries: Clear regulatory frameworks are needed to address data privacy, cybersecurity, and other technological risks.The review also recommends developing human capital, digital inclusivity, citizen participation, environmental sustainability, start-ups, and fair public-private partnerships.

7. Conclusions

The review concludes that technology-enabled smart cities in developing countries require concurrent socioeconomic, human, legal, and regulatory reforms embedded in long-term development trajectories.

  • Smart cities in developing countries can only be realised alongside concurrent socioeconomic, human, legal, and regulatory reforms.These reforms must be embedded in countries’ long-term developmental trajectories.
  • Relevant contextual conditions include social development, economic policy, financial endowment, and citizens’ technological literacy and willingness to participate.

Appendix A: The Contexts of the 56 Studies Included in the Systematic Literature Review

The appendix catalogs studies examining smart-city concepts, dimensions, drivers, goals, instruments, implementation experiences, financing, sustainability, and barriers across developing-country contexts.

  • Methods represented include structured equation modelling, exploratory factor analysis, literature review with expert opinion, surveys, and best-worst method analysis.
  • The studies also investigate financing options, policy instruments, governance, citizen engagement, mobility, low-carbon development, and sustainability.
  • The reviewed studies address smart-city conceptualisations, dimensions, goals, drivers, and challenges in developing-country settings.
  • Several studies examine country- or city-specific implementation experiences, including India, China, Indonesia, Malaysia, Brazil, and Egypt.
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