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Cléo Chassonnery-Zaïgouche

Economists in the City #3 1020 786 Cléo Chassonnery-Zaïgouche

Economists in the City #3

From Cities to Nations: Jane Jacobs’ Thinking about Economic Expansion

by Cédric Philadelphe Divry

Jane Jacobs (1916-2006) is best known for her critique of top-down forms of city planning and urban renewal projects, laid out in the groundbreaking The Death and Life of Great American Cities (1961). This had a profound impact on the profession of urban planning, boosted the institutionalization of urban economics, and considerably influenced community organizing. She was one of the most celebrated thinkers about cities in the twentieth century, and her ideas have had a long-lasting influence on urbanism.

What is less well known is her economic thinking, which was developed in her subsequent works, although a partial reinterpretation of this has gained traction since the 1990s. However, a more comprehensive interpretation is needed if we are to grasp the nature of her theorization of cities, and the policy lessons she drew from her insights.

Numerous interviews with her, events in her honor and commentaries on her work have mostly focused on her urban thought and activism, and advanced the appealing narrative of a housewife standing up to men bulldozing the neighborhoods of 1950s New York City. But when asked about her own legacy, she dissented from this view:

If I were to be remembered as a really important thinker of the century, the most important thing I’ve contributed is my discussion of what makes economic expansion happen. This is something that has puzzled people always. (Jacobs, 2001)

A reading of all of her works brings to the fore a thinker theorizing the economic behavior of cities on the basis of a rich understanding of the urban social fabric. Starting with The Death and Life of Great American Cities, and across during five subsequent decades, she led an enquiry into the mechanisms of what she termed “economic expansion,” and elaborated her own approach to the dynamics of economic growth and development.


The Economy of Cities (1969) and Cities and the Wealth of Nations (1984)

Two works are especially important in the development of her thinking. In The Economy of Cities (1969), she builds upon her insights of her earlier The Death and Life of Great American Cities to derive a “city economy model.” This describes how the economic lifecycles of cities depend largely on the relation between local economic activity and inter-city trade, from periods of “explosive” growth to eventual stagnation and economic decline. Fifteen years later, Cities and the Wealth of Nations: Principles of Economic Life (1984) argued against the idea of nations as economic units, highlighting the contradictory dynamics of political expansion and long-term economic development. In 2006, she left behind the first draft of what would have been a broader synthesis of her economic theory.


A series of diagrams in the appendix of The Economy of Cities (p.253, p.257) illustrates a number of stages in the lifecycle of a city economy. On the left, an early stage where the export (E) of a good previously produced (P) for local consumption (C) may trigger an increase in imports (I) accompanied by population increase, (part of the “export multiplier effect” EM). On the right, part of the process of a later stage dubbed “import-replacing,” when a local economy replaces an important number of former imports and grows relatively to its export economy.

Considering her contribution to economic theory may seem counter-intuitive. In addition to lacking academic credentials, she took little interest in engaging the discipline of economics. Her models were neither formal nor developed in reference to existing models. And her view of economic theory in general was dismissive. In the opening chapter of Cities and The Wealth of Nations, “Fool’s paradise,” Jacobs lays out a history of economic thought and arrives at this sweeping conclusion: “Choosing among the existing schools of thought is bootless. We are on our own.” The same dismissive stance extended to academic institutions, as she refused numerous honorary degrees from various Universities.

And yet, some economists had picked up on her insights. A type of economic externality has been derived from her detailed historical accounts of new economic activities arising from urban diversity. Chicago and Harvard urban economists Glaeser, Kallal, Scheinkman, and Shleifer credited Jacobs in 1992 for identifying cross-industry knowledge transfers, which they dubbed “Jacobs externalities.” The concept was based on Jacobs’ The Economy of Cities and posits that knowledge transfer occur between different industries, and that local competition supports economic growth. This came four years after future Nobel prize recipient Robert Lucas pointed to Jacobs’ work while investigating the external effects of human capital in his 1988 article On the Mechanics of Economic Development, although without formalizing his insight. Lucas’ endorsement earned Jacobs increasing recognition among economists over the following decades. Paul Krugman described her as a “patron saint of the new growth theory” and her unusual status was summed up by Robert Dimand and Robert Koehn who saw her as “her own distinctive kind of political economist … an exceptional instance of a woman without academic affiliation or university training achieving recognition among leading academic economists”. And a considerable literature grew up after Glaeser et al.’s piece. And in 2016, based on a growing number of attempts to quantify Jacobs externalities, academic interest for her work was at an all-time high.

But although Jacobs does repeatedly make the argument for local diversity which is captured by the externality bearing her name, it merely serves as the basis for her wider system. From her understanding of local economic life in an urban setting, she derived a model of the city as an economic unit with a structure and a lifecycle, which in turn she used to analyze macroeconomic phenomena. Despite this interest in her work, extended reassessments of her contribution to economic thought have yet to appear. Jacobs’ stance towards economic theory may somewhat explain this situation. But while her writings do not fit the template of conventional economics, they do connect her with other established interpretative paradigms.

Analogies and evolutionary thinking

One line of interpretation of Jacobs’ work explores her repeated use of ecological and biological analogies. She often made the case that looking at patterns in nature may help understand dynamics in the economy. But although these analogies highlight the dynamic aspects of her conception of city economies, they are not sufficient evidence of her evolutionary understanding of economic development.

The city economy model, first developed in The Economy of Cities,argues that the desirable diversification of local economic activities depends largely on the destination of goods and services entering the city’s economy. The key claim is that imports are key to economic development: they embody knowledge and allow further diversifications in the local economy, as imports are gradually replaced by local supply, and make “room” for new imports – in a similar manner to import substitution. Jacobs uses this model to stress the long-term undesirability of overspecialization derived from a focus on maximizing exports, and the importance of a large and diverse local economy – ultimately delivering a critique of comparative advantages as an organizing principle of trade.

The closing chapter of Cities and the Wealth of Nations provides a succinct version of two analogies which Jacobs uses to help conceptualize the dynamic features of a city economy. She likens the apparent order at work in cities in terms of “…biological evolution whose purpose, if any, we cannot see unless we are satisfied to think its purpose is us.” And further:

“[T]he more niches that are filled in a given natural ecology, other things being equal, the more efficiently it uses the energy it has at its disposal … That is another way of saying that economies producing diversely and amply for their own people and producers, as well as for others, are better off than specialized economies …”

The most elaborate study of Jacobs’ use of biological and ecological analogies is provided in mathematician and philosopher David Ellerman’s paper How Do We Grow? Jane Jacobs on Diversification and Specialization (2005). In this original treatment of Jacobs’ economic thought, Ellerman expands on Jacobs’ set of analogies to reframe her often overlooked city economy model. As he puts it, in the case of the ecological analogy:

“Organized energy comes free from the sun, but its trajectory within an ecology will depend on the complexity of the system. The two extremes could be taken as a desert and a rain forest. A rain forest and a desert at the same latitude would have about the same amount of solar energy arriving per unit area. In the case of the desert, it is essentially a sterile conduit; the energy comes in during the day and is dissipated at night. Little is captured; it is a throughput operation. The opposite is the case for the rain forest. much energy is captured through the photosynthesis of its plants.”

According to Ellerman, this would be translated in economic theory as follows: the flow of organized energy equates to money in the economic system, funds which have a multiplier effect on the local economy depending on a number of factors, before being dissipated. However, he notes that Jacobs equates organized energy with “embodied knowledge and know-how.” This difference illustrates why imports, not exports (which would matter most if organized energy equated to money in the analogy), are key in Jacobs’ system, in which “development is a conceptualized form of social learning.” Incoming goods, the products of foreign know-how, are vectors of developmental learning. And exports of commodities and services fund these imports. What separates economic rain forests from economic deserts in Jacobs’ system would be “the way imports are used” (or the path they follow), whether they are “primary, intermediate, final, or producer goods.” When imports feed into the somewhat enclaved export economy (i.e. overspecialized), they have a lesser effect then when they are dissipated in local consumption.

Ellerman’s reframing diverges from the usual Jacobsian argument for local diversity by depicting the city economy’s boundaries as an open system governed by evolutionary dynamics. It may also open up the possibility of considering Jacobs’ writings as a contribution to evolutionary economics. For example, following Geoffrey Hodgson’s taxonomy in Economics and Evolution (1993), part of Jacobs’ system could be characterized as phylogenetic and non-consummatory, that is, as exhibiting an open-ended process of evolutionary selection among a population of firms and individuals.

But Jacobs’ economic thought does not consistently involve the application of evolutionary logic to the processes she attempts to uncover. Her analogies primarily serve to help us think of city economies as complex systems, within which she chooses to highlight specific properties.

Solving problems of “organized complexity”

The paradigm of “organized complexity” she explicitly embraces in The Death and Life of Great American Cities, appears to also run through her economic thought. Jacobs borrowed the concept from mathematician Warren Weaver and appears early on in The Death and Life of Great American Cities to characterize the “kind of problem a city is;” which, in Weaver’s words, “[a]s contrasted with the disorganized situations with which statistics can cope, show the essential feature of organization”. The prevalence of this paradigm in her economic writings is probably what drew Friedrich Hayek’s attention to The Death and Life of Great American Cities. It has also has been highlighted by author David Warsh in The Idea of Economic Complexity (1984).

Cover of Cosmos + Taxis issue dedicated to Jane Jacobs (2017)

More recently, in 2017, the publication Cosmos + Taxis dedicated an issue to Jane Jacobs. And as Pierre Desrochers and Joanna Szurmak note, despite academic interest in Jacobs’ work being at an “all-time high,” her economic theory has yet to be studied from the perspective of the “paradigm which shaped her worldview.” I would suggest that the study of “feedback mechanisms” in Jacobs’ economic writings may be an effective first step in addressing this deficiency, while also highlighting her critical discussion of urban policies.

Positive feedback relationships are a central mechanism in the study of complex systems, as they help explain self-reinforcing behaviors and path dependency. Jacobs repeatedly identifies feedback mechanisms while investigating how city economies evolve in a national setting and drew wider conclusions about to promote long-term city growth. Whether feedback is “accurate” or “faulty” in Jacobs’ terms depends for the most part on whether or not the feedback conveys correct information about the quantity of imports a city economy can “earn” from its local production. As a conceptual tool, Jacobs’ uses feedback mechanisms to expose leverage points in economic systems. Just as The Death and Life of Great American Cities was targeted at ongoing urban renewal projects, her economic writings often involved a critique of policies.

In Cities and the Wealth of Nations, she argues that the unity of nations as political units often rests on “faulty feedback to cities,” for instance national currencies which act as “powerful carriers of feedback information” on the demand for a city’s exports. She hypothesizes that national currencies, because they provide consolidated information on a nation’s international trade, provide feedback best tailored for the city which weighs the most in the nation’s economy. Such feedback accrues over time and helps explain what she calls the “elephant city-region pattern,” where a city gains a definitive edge over the others, which in time may require subsidies – subsidies returning their own faulty feedback to cities which cannot make the adjustments to expand from their own local activity. This grim outlook on the future of cities within nations prompted her to argue in favor of the independence of Quebec in The Question of Separatism: Quebec and the Struggle over Sovereignty (1980).

Likewise, Jacobs targeted development schemes developed by the World Bank. She pointed to the inherent weaknesses of Robert McNamara’s development strategies for addressing “basic human needs” (literacy, nutrition, reduction in infant mortality, and health) of poor populations. She argued that because economic development is a process, it cannot be thought of as a “collection of things” which can be bought or provided. The “basic human needs approach” ignored the necessity for solvent markets to support increased agricultural yields and the populations that were being displaced. As they could no longer rely on agricultural work to sustain themselves, displaced workers failed to find jobs in nearby city economies, where labor markets had not evolved alongside the increased agricultural yields through a succession of appropriate feedback mechanisms triggering the needed corrections. And she made the same argument against technology transfers in the “Green Revolution” of the 1960s and 1970s.

The mechanism of feedback relationships is one example among others of Jacobs’ usage of systemic concepts to draw boundaries around the city economy as a system and elaborate on its behavior. Further examination of Jacobs’ use of these concepts within the paradigm she adopted may reveal a consistent link between her analysis of cities as economic units and the policies she is tended to critique. In short, future attempts at more comprehensive interpretations of Jacobs’ economic thought might benefit from stepping away from the urban focus of The Death and Life of Great American Cities while considering more carefully her later economic writings.


Cédric Philadelphe Divry is a graduate student at PHARE, University of Paris 1 Panthéon-Sorbonne. His work examines conceptions of cities in the history of economic thought, in particular during the mid-19th century urban renewal of Paris and in the economic writings of urban theorist Jane Jacobs (1916-2006).


Other posts from the blogged conference:

Cities and Space: Towards a History of ‘Urban Economics’, by Beatrice Cherrier & Anthony Rebours

Economists in the City: Reconsidering the History of Urban Policy Expertise: An Introduction, by Mike Kenny & Cléo Chassonnery-Zaïgouche

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Economists in the City

When and why did the expertise and knowledge of economists become so highly valued in the world of public policy? Our blogged conference explores this question by bringing together historians of economics, economists, urban policy experts and social scientists. Blogposts from each participants will be published on a rolling basis. After we have published each of their contributions, we will invite other contributors to comment in response, and will offer our own reflections about some of the key debates and issues.

Contributions:

Economists in the City: Reconsidering the History of Urban Policy Expertise: An Introduction, by Mike Kenny & Cléo Chassonnery-Zaïgouche

Cities and Space: Towards a History of ‘Urban Economics’, by Beatrice Cherrier & Anthony Rebours

From Cities to Nations: Jane Jacobs’ Thinking about Economic Expansion by Cédric Philadelphe Divry

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Economists in the City #2

Cities and Space: Towards a History of ‘Urban Economics’

by Beatrice Cherrier & Anthony Rebours

 A map for a hostile territory?

The field of ‘Urban Economics’ is an elusive object. That economic phenomena related to the city might need a distinctive form of analysis was something economists hardly thought about until the early 1960s. In the United States, it took a few simultaneous scholarly articles, a series of urban riots, and the attention of the largest American philanthropies to make this one of the hottest topics in economics. The hype about it was, however, short-lived enough so­­­ that, by the 1980s, urban economics was considered a small, ‘peripheral’ field. It was only through the absorption into a new framework to analyze the location of economic activities – the ‘New Economics Geography’ – in the 1990s that it regained prominence.

Understanding the development of urban economics as a field, or last least the variant which originated in the US and later became international, presents a tricky task. This is because the institutional markers of an academic field are difficult to grasp. A joint society with real estate economists was established in 1964, and a standalone one in 2006; a journal was founded in 1974, with an inaugural editorial which stated that: “Urban economics is a diffuse subject, with more ambiguous boundaries than most specialties. The goal of this Journal is to increase rather than decrease that ambiguity;” a series of handbooks was shared with the neighboring field of regional economics; textbooks and courses about urban and geographical, urban and spatial, or urban and real estate economics were published; and programs that mixed urban economics with neighboring disciplines such as urban geography and urban planning emerged. Situated within a master-discipline (economics) that is often described as exhibiting an articulated identity, clear boundaries with other sciences and strict hierarchies, urban economics is an outlier.

There is, however, one stable and distinctive object that has been associated with the term ‘urban economics’ throughout the 1970s, the 1980s, the 2000s and the 2010s:  the Alonso-Muth-Mills model (AMM). It represents a monocentric city where households make trade-offs between land, goods and services, and the commuting costs needed to access the workplace. The price of land decreases with distance from the city center. The model was articulated almost simultaneously in William Alonso’s dissertation, published in 1964, a 1967 article by Edwin B. Mills, and a book by John Muth published in 1969. This trilogy is often considered as a “founding act” of urban economics.

Alonso (1964) and Muth (1969) are the most cited of all the articles published in the Journal of Urban Economics, with Mills (1967) being ranked at 9. If there is a coherent field of ‘urban economics’ to be studied, it makes sense to focus on these three publications in particular. To do so, we collected citations to each of these ‘AMM’ texts in all the journals indexed in the Web of Science database between 1965 and 2009. We then reconstruct a partial map of the field through representing, across 5 year periods, the network of scholars who authored texts co-cited with either one or several of these three ‘foundational’ texts. We thus interpret a citation to one of these three contributions as signaling a specific interest in the kinds of work being done in the field of urban economics. By mapping the authors most co-cited alongside Alonso, Muth or Mills in successive time windows, we aim to reconstruct some sort of core urban economics community (without making claims about the entire scope or outer boundaries of the field).  We have supplemented this rough map of the changing fate of AMM with individual and institutional archives, so as to delineate and flesh out the territory populated by urban economists. Below is a summary of the main trends that we identify.

Agglomeration

In 1956, William Alonso moved from Harvard, where he had completed architecture and urban planning degrees at the University of Pennsylvania. He became Walter Isard’s first graduate student in the newly founded department of “regional science.” He applied a model of agricultural land use developed 150 years earlier by the German economist Johann Von Thünen to a city where all employment is located in a Central Business District. His goal was to understand how the residential land market worked and could be improved. His resulting PhD, Location and Land Use, was completed in 1960.  Around that time, young Chicago housing economist Richard Muth spent a snowstorm lockdown thinking about how markets determine land values. The resulting model he developed was expanded to study population density. And a book based on it was published a decade later: Cities and Housing. Drafts of Alonso and Muth’s work reached inventory specialist Edwin Mills in 1966, while he was working at the RAND corporation, and trying to turn models describing growth paths over time into a model explaining distance from an urban center. His “Aggregative Model of Resource Allocation in a Metropolitan Area” was published the next year.

As is clear from the network map below, this new set of models immediately drew attention from a wide array of transportation economists, engineers and geographers concerned with explaining the size and transformation of cities, why citizens chose to live in centers or suburbs, and how to develop an efficient transportation system. The economists included Raymond Vernon and Edgar Hoover, whose study of New York became the Anatomy of the Metropolis; RAND analyst Ira Lowry, who developed a famous spatial interaction model; spatial and transportation econometrician Martin Beckman, based at Brown; and Harvard’s John Kain, who was then working on his spatial mismatch hypothesis and a simulation approach to model polycentric workplaces. Through the early works of Brian Berry and David Harvey, quantitative urban geographers also engaged with these new urban land use models.

Authors co-citation network 1970-1974. The colors result from a community detection algorithm applied to the whole network, but for readability, only those authors with 11 or more links to Alonso (1964) and/or Mills (1967) and/or Muth (1969) are represented. The size of the nodes and links is proportional to the total number of co-citations. The 1970-1974 network represents the state of urban economics as expressed through citations by economists who published at the time, thus, there might be a short time lag between the publication of new works and their incorporation by the rest of the profession.

But the development of a new generation of models relying on optimization behavior to explain urban location was by no mean sufficient to engender a separate field of economics.  Neither Alonso, who saw himself as contributing to an interdisciplinary regional science, nor Muth, involved in Chicago housing policy debates, cared much about its institutionalization. But both were influenced and funded by men who did. Muth acknowledged the influence of Lowdon Wingo, who had authored a land use model. Together with Harvey Perloff, a professor of social sciences at the University of Chicago, they convinced the Washington-based think-thank Resource for the Future to establish a “Committee for Urban Economics” with the help of a grant by the Ford Foundation. The decision was fueled by urbanization and dissatisfaction with the urban renewal programs implemented in the 1950s. Their goal was to “develop a common analytical framework” through the establishment of graduate programs in urban economics, and supporting dissertations, and coordinating the organization of workshops and the development of urban economics textbooks.

Their agenda was soon boosted by the publication of Jane Jacobs’ The Death and Life of Great American Cities, and by growing policy interest in the problems of congestion, pollution, housing segregation and ghettoization, labor discrimination, slums, crime and local government bankruptcy, and by the stream of housing and transportation acts which were passed in response to these. The Watts riots, followed by the McCone and Kerner commissions, acted as an important catalyst. The Ford Foundation poured more than $ 20 millions into urban chairs, programs and institutes through urban grants awarded to Columbia, Chicago, Harvard and MIT in 1967 and 1970. The first round of funds emphasized “the development of an analytical framework”, and the second sought “a direction for effective action.”

As a consequence of this massive investment, virtually every well-known US economist turned to urban topics, as shown by the several names of theorists and public or labor economists expanding the 1975-79 network below. At MIT, for instance, Ford’s money was used to set up a two-year “urban policy seminar,” which was attended by more than half of the department.The organizer was welfare theorist Jerome Rothenberg, who had just published a book on the evaluation of urban renewal policies. He was developing a large-scale econometric model of the Boston area with Robert Engle and John Harris, and putting together a reader with his radical colleague Matt Edel. Department chair Carry Brown and Peter Diamond were working on municipal finance. Robert Hall was studying public assistance while Paul Joskow examined urban fire and property insurance. Robert Solow developed a theoretical model of urban congestion, published in a 1972 special issue of the Swedish Journal of Economics, alongside a model by taxation theorist Jim Mirrlees investigating the effect of commuter and housing state tax on land use. Solow’s former student Avinash Dixit published an article modeling a tradeoff between city center economies of scale and commuting congestion costs in another special issue on urban economics in the Bell Journal the next year. A survey of the field was also published in the Journal of Economic Literature, just before the foundation of the Journal of Urban Economics in 1974.





Authors co-citation network 1975-1979 (11 or more links), the size of the nodes and links being proportional to the total number of co-citations.

Segregation

But the publication of a dedicated journal, and growing awareness of the “New Urban Economics” was not the beginning of a breakthrough. It turned out to be the peak of this wave. On the demand side, the growing policy interest and financial support that had fueled this new body of work receded after the election of Richard Nixon and the reorientation of federal policies. On the supply side, the mix of questions, methods and conversations with neighboring scholars that had hitherto characterized urban economics was becoming an impediment. More generally, the 1970s was a period of consolidation for the economics profession. To be considered as bona fide parts of the discipline, applied fields needed to reshape themselves around a theoretical core, usually a few general equilibrium micro-founded workhorse models. Some old fields (macro and public economy for instance) as well as newer ones (health, education, household) developed such theoretical models. Others resisted, but could rely on separate funding streams and policy networks (development and agricultural). Urban economics was stuck.  

Policy and business interest was directed toward topics like housing, public choice and transportation. And, combined with the growing availability of new microdata, micro-econometrics advances, and the subsequent spread of the personal computer, this resulted in an outpouring of applied research. Computable transportation models and real estate forecasting models were especially fashionable.

On the other hand, a theoretical unification was not in sight. Workhorse models of the price of amenities, the demand for housing, or suburban transportation, were proposed by Sherwin Rosen, William Wheaton and Michelle White, among others. But explanations of the size, number, structure and growth of cities were now becoming contested. J. Vernon Henderson developed a general equilibrium theory of urban systems based on the trade-off between external economies and diseconomies of city size, but in these agglomeration effects did not rely on individual behavior. Isard’s former student Masahita Fujita proposed a unified theory of urban land use and city size that combined externalities and the monopolistic competition framework pioneered by Dixit and Joseph Stiglitz, but without making his framework dynamic or relaxing the monocentric hypothesis. At a point when there was growing interest in the phenomenon of business districts –  or Edge cities as journalist Joël Garreau called them, this was considered a shortcoming by many economists. General equilibrium modelling was rejected by other contributors, including by figures like  Harry Richardson, and a set of radical economists moving closer to urban geographers (such as David Harvey, Doreen Massey and Allen Scott) working with neo-Marxist ideas.

Renewal

In the 1990s, various trends aimed at explaining the number, size, evolution of cities matured and were confronted to one another. In work which he framed as contributing to the new field of “economic geography,” Krugman aimed to employ his core-periphery model to sustain a unified explanation for the agglomeration of economic activity in space. At Chicago, those economists who had spent most of the 1980s modeling how different types of externalities and  increasing returns could help explain growth – among them Robert Lucas, José Scheikman and his student Ed Glaeser – increasingly reflected on Jane Jacob’s claim that cities exist because of the spillover of ideas across industries which they facilitate. Some of them found empirical support for her claim than for the kind within-industry knowledge spillovers Henderson was advocating.

Krugman soon worked with Fujita to build a model with labour mobility, trade-offs between economies of scale at the plant level and transportation costs to cities. Their new framework he was adamant to compare to Henderson’s general equilibrium model of systems of cities. He claimed that their framework enabled the derivation of agglomeration from individual behavior and could explain not only city size and structure, but also location.  In his review of Krugman and Fujita’s 1999 book with Venables, Glaeser praised the unification of urban, regional and international economics around the microfoundations of agglomeration theory. He also contrasted Krugman’s emphasis upon transportation costs – which were then declining – with other frameworks focusing on people’s own movement, and began to sketch out the research program focused on idea exchanges that he would develop in the next decades. He also insisted on the importance of working out empirically testable hypotheses.

The “New Economic Geography” was carried by a newly-minted John Bates Clark medalist who had, from the outset, promised to lift regional, spatial and urban economics from their “peripheral” status through parsimonious, micro-founded, tractable and flexible models. It attracted a new generation of international scholars, for some of whom working on cities was a special case of contributing to spatial economics. In the process, however, olders ties with geographers were severed, and questions that were closely associated with changing cities, like the emergence of the digital age, congestion, inequalities in housing, segregation, the rise of crime and urban riots, became less central to the identity of this field. The field lost some sort of autonomy. Within our own maps, this can be seen from the contrast between the many disparate  links which leading urban economists had to Alonso-Muth-Mills, and the discrete, interconnected (green) network in which figures like Fujita, Krugman, Henderson, Lucas, and  Glaeser are embedded.

Authors co-citation network 2005-2009 (15 or more links), the size of the nodes and links being proportional to the total number of co-citations.

Most recently, Glaeser’s insistence that urban models need to be judged by their empirical fit may be again transforming the identity of urban economics. The shift is already visible in the latest volume of the series of Handbooks in Urban and Regional Science. Its editors (Gilles Duranton, Henderson and William Strange) explain that, while its previous volume (2004) was heavily focused on agglomeration theory, this one is “a return to more traditional urban topics.” And the field is now characterised not in terms of a unified, theorical framework, but with reference to a shared empirical epistemology about how to develop causal inferences from spatial data. There is also growing evidence that students going on the US economics job market  increasingly add “spatial economics” and/or “urban economics” to their field list.

Overall, the successive shifts in urban economists’ identity and autonomy which we describe here, were sometimes prompted by external pressures (urban crises and policy responses) and sometimes from internal epistemological shifts about what counts as “good economic science.” A key development in the 1970s was the unification around general equilibrium, micro-founded models. It is widely held that the profession is currently experiencing an “applied turn” or a “credibility revolution”, centered on the establishment of causal inference (gold) standards. How this will affect urban economics remains unclear.


Beatrice Cherrier is an associate professor at the Centre National de la Recherche Scientifique (CNRS). She documents the “applied turn” in the history of recent economics through chasing institutional artifacts like the JEL codes, researching the history of selected applied field (urban, public, macro) and unpacking its gendered aspects.   

Anthony Rebours is currently a graduate student at University Paris 8 and a young fellow of the Center for the History of Political Economy (CHOPE) at Duke University. His interests are about the recent history of economics and its relations with geography, and the use of sociological methods for quantitative history.


Other posts from the blogged conference:

Economists in the City: Reconsidering the History of Urban Policy Expertise: An Introduction, by Mike Kenny & Cléo Chassonnery-Zaïgouche

From Cities to Nations: Jane Jacobs’ Thinking about Economic Expansion by Cédric Philadelphe Divry

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Economists in the City #1

Economists in the City: Reconsidering the History of Urban Policy Expertise

An introduction

When and why did the expertise associated with economics as an academic discipline become so highly valued in the world of public policy? 

We planned a workshop to explore this broad question in relation to the more specific theme of policy-making in relation to cities, and the influence of agglomeration economics upon urban and government policy in countries like the US, France and the UK. And our aim was to examine, in particular, the increasing focus upon cities in the work of an important group of economists since the 1980s, and to explore some of the main lines of criticism of public policies that reflect the logic and value of agglomeration.

Detail from Booth Inquiry into the Life and Labour of People in London. Map Description of London Poverty, 1898-9, West Central District. https://booth.lse.ac.uk/map/14/-0.1174/51.5064/100/0, Public Domain

We anticipated a rich conversation on these issues between historians of economics, economists, urban policy experts and social scientists. The embedding of agglomerationism within the thinking of policy-makers and governmental institutions provides a fascinating example of a broader shift towards the growing impact of economic expertise, and indeed of individual economists, on policy-making.

This focus sits within a wider field of study which is interested in the complex roles that economists have at times played – as public intellectuals, policy experts and academic specialists. How different kinds of analytical tools and a particular style of economic reasoning made their way into the world of elite decision-making is a major theme of interest for many historians and social scientists. So too is the related question of how quantification (testable theoretical hypotheses, measurement technique and indicators, as well as decision-models) has over the last few decades gained ascendancy in policy circles.

As a result of the on-going Covid-19 crisis, we have decided to convert this event into a blogged conference, publishing shortened, online versions of a number of the papers that were due to be presented at the original event, and eliciting comments and responses to these as comments.

We will be publishing the first of these posts on Monday 18 May, and others will appear shortly afterwards. The conference will open with a contribution from Dr Béatrice Cherrier (CNRS, University of Cergy-Pontoise) and Anthony Rebours (University Paris 8), Cities and Space: Towards a History of ‘Urban Economics’, introducing readers to the pre-history of agglomeration economics, and offering reflections on how the field of urban economics in the US provided a crucible for its later development.

Our other contributors include, Professor Diane Coyle (University of Cambridge), Professor Ron Martin (University of Cambridge), Cedric Philadelphe Divry (University Paris 1 Panthéon-Sorbonne), Professor Denise Pumain (University Paris 1 Panthéon-Sorbonne) and Professor Philip McCann (University of Sheffield).

After we have published each of their contributions, we will invite other contributors to comment in response, and will offer our own reflections about some of the key debates and issues.

We would like to thank The Humanities and Social Change International Foundation for supporting the work of the ‘Expertise Under Pressure’ project at Cambridge, which hosts this particular project, as well as colleagues at CRASSH where the project is based, for their intellectual and logistical support for it.

Michael Kenny and Cléo Chassonnery-Zaïgouche

Cambridge, 15 May 2020.

 

PS: We chose as a visual an detail from a map made for Booth’s Inquiry into the Life and Labour of People in London. It is a part of this particular map: Map Description of London Poverty, 1898-9, West Central District, part of a larger enterprise to produce maps for London in which the levels of poverty and wealth fare mapped out street by street.