Agglomeration Economics

In The American (the Journal of the American Enterprise Institute), Ryan Streeter calls out the danger of outmoded political thinking that places cities solely on the agenda of the left. He offers three reasons:

1. First, cities rather than states will increasingly drive national economies. States that recognize this and adjust policy accordingly will get ahead.
2. Second, things like the cost of construction, traffic, and green policies in a state’s largest city, or cities, will begin to matter more to a state’s overall competitiveness than ever before. Whither the city goes the state.
3. Third, congressional maps will become more metro and less agrarian, meaning that the interests of metropolitan areas will increasingly dominate national policy debates.

With one-third of Americans inhabiting just 16 metro areas and all demographic trends pointing toward an increase in the agglomeration of economic activity, our competitiveness will increasingly rely on understanding how cities best facilitate knowledge spill-overs and entrepreneurship.

For more on "agglomeration economics" Streeter suggests a review of a new book by the same name edited by Harvard economist Ed Glaeser.

  

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