Wednesday, October 19, 2005

Cities: Economy-Ecology

Jason Potts writes about the economy of cities by borrowing from ecology:
"Economic theory has always had a blind-spot when it comes to geographical spatial analysis. Price signals go a long way in abstract, yet the connective or associative distribution of economic activities remains a not much studied and, indeed, barely recognized economic phenomena.

Yet it is the heart of economics. The spatial (or generic) distribution of activities is the current state of the order (or division of labor) of an economic system. Any economic order means an organizational distribution of who is doing what and in what order. While we may attribute localized clustering to spatial features of a place (e.g. a great port or beach) there is yet a stronger force of social gravitation.
I think this is good stuff for us to think about. Standard economic analysis is static, and yet, real economic activity is probably better described as a dynamic complex process that evolves.

He suggests borrowing the idea of ecological hotspots in which diversity is concentrated, and he speculates that we might see cities as hotspots where economic diversity is concentrated. I also like his suggestion that:

"So, evolutionary economists need to understand how cities form as economic attractors."

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