Urban Centers And Innovation

In 2008, for the first time in history, more than half of the world’s population will be living in urban areas.  By 2030 this number will swell to almost 5 billion, and a US census bureau official called increased American urbanization between 2000 and 2010 “extremely significant.”  Harvard economist Edward Glaeser’s sought to describe the economic effects of this upswing in urbanization in his recent book, The Triumph of the City.  He argues that collective city living is a major driver of innovation, and will contribute substantially to economic development.  “Globalization and new technologies have increased the returns to being smart and we get smart by being around other smart people in cities.”  Glaeser sees the collaboration between creative minds in densely populated areas as a sure sign of free market growth to come.  As reporter David Stetfox points out, however, his free market analyses save little breath for social inequities and the “woolly notions of identity and belonging” particular to cities or towns.

Economists have attempted to quantify Glaeser’s theories with statistical analyses of patent data, economic growth, and population shifts.  Brian Knudsen, Richard Florida, Gary Gates, and Kevin Stolarick produced a report in 2007 that “finds a positive relationship between the density of creative workers and metropolitan patenting activity.  This suggests that density is a key component of knowledge spillovers and a key component of innovation.”  By connecting geographic concentration and resulting innovative capacity, the study shows that urban areas enable new growth by bringing together inventive minds to a creative proximity.

Responding to a need to increase innovation in rural areas as well, the OECD held a conference to address the capacity for growth outside rapidly growing cities.  Citing a brain drain, the representatives hoped to encourage a “creative class” that could exploit the innovative advantages particular to agricultural areas.  Angel Gurría, Secretary-General of the OECD, concluded hopefully that “globalization can be a positive-sum game. This is true for the relationship between developed and developing countries, but also for the relationship between rural and urban regions.”

Posted by: John Coit

Sources: billingsgazette.com creativeclass.com, nytimes.com, oecd.com, thenational.ae, unfpa.org

Photo Credit: IMGP0053 – cityscape by flickr user RaeA.

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