Triumph of The City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier, and Happier (2011)

India has a lot of poverty, bad roads, an unstable electric grid, and a great deal of bureaucratic red tape. Manufacturing companies have trouble opening businesses there, “which explains why the country seems to be leapfrogging straight from agriculture to information technology” (17-18).

The city as an idea factory got its start in Athens in the 500s BC, when philosophers, artists, historians, and scholars converged on the metropolis, tutored the wealthy, and met to exchange ideas. Their work formed the foundations of Western thought and undergirded Rome's empire, whose greatest strength was its cities, well-connected by roads and aqueducts.

The fall of the Roman Empire led to the decline of European cities and a loss of knowledge. In the early 800s, Islamic rulers stitched together their own network of cities between the Iberian Peninsula and the Middle East, and learning began to travel those roads. The new capital, Baghdad, installed scholars in a House of Wisdom, where they collected and translated great works from all over the world in mathematics, medicine, and philosophy—in the process preserving many of Europe’s classics—and then developed new technologies and skills, most famously algebra.

This knowledge slowly found its way back into Europe, which gradually reconnected its cities, where monasteries and universities sprang up to rediscover the classics of knowledge and develop yet more. “By the eighteenth century, Western technology and thought had come to dominate the world” (22). Commerce expanded, and with it came more innovation, which led to military victories that, in turn, generated yet more technological improvements. 

Western colonial domination finally reached Japan in 1853, opening that country wide to trade. The Japanese took advantage of European ways, rapidly industrialized, and by 1910 made colonial inroads in China and Korea. The secret was Nagasaki, a southern city where, since 1543, all foreign trade secretly took place. Through that port came a trickle of European technical knowledge that accumulated continuously until, by the early 1800s, Japan had become a world leader in medical practice. By the early 20th century, the careful study and application of Western military techniques enabled Japan to conquer an empire.

Cities like Nagasaki become centers of international communication where widely differing ideas can meet and intermingle. Such a city's workforce grows as more companies set up shop there, which, in turn, attracts more workers and more firms in a virtuous cycle. For example, Bangalore and its neighbor Mysore are famous for their engineering schools, advanced industrialization, and pro-business beliefs; the founders of the Indian information technology firm Infosys moved to Bangalore to be near a branch office of one of their first overseas clients; by 2008, Infosys had nearly 100,000 workers, and the city had grown into an IT hub.

An effective estimate of the skill level of a city is its percentage of college graduates. “As the share of the population with college degrees increases by 10 percent, per capita gross metropolitan product rises by 22 percent” (27), and cities with higher percentages also grow faster. On average, an extra year of schooling increases a country’s gross domestic product by 30 percent. In the US in 1970, cities with unionized factory workers had higher overall incomes than cities with more education, but by 2000 that had reversed. Computerized technology has replaced unskilled workers but rewarded the better educated.

Santa Clara County, California, informally known as Silicon Valley, is the world’s premier locus of high technology development: “It attracts brilliant people and then connects them” (32) by concentrating them in one urban area that inspires intellectual ferment. Early 20th-century radio and vacuum-tube businesses there gave way in the 1950s and 1960s to a budding collection of computer-tech companies—Hewlett-Packard, Fairchild Semiconductor, Intel, and others—that occupied an industrial park near Stanford University, developed by Stanford’s engineering dean, Frederick Terman. By the early 2000s, Apple Computer, Yahoo, Google, and others had joined the group and grown into industry giants.

Today, nearly 80% of Silicon Valley’s adult residents have a college degree. An attractive, if expensive, place to live, the Valley is basically a one-product town. However, it avoids the stagnation suffered by earlier single-industry cities such as Detroit by combining markets—for example, Facebook, which melds IT with social media. Firms also hire experts from other industries as new boardroom blood, and the same Internet that those companies helped invent can keep them abreast of the latest developments in every industry.

Why can’t IT companies simply use the Internet to communicate and innovate? Research shows that in-person work sessions produce more of a sense of personal investment in the group, leading to better cooperation, than do electronic meetings. In teams and in person, people pace each other to greater achievement, and they also work longer when they live in big, competitive cities. Patent citations come from nearby sources twice as often as chance would dictate, and companies located near the center of their industry are more productive. Newer workers become more successful when they receive expertise at the workplace from more-experienced workers.

Jevon’s Paradox states that a technology that becomes more efficient gets more use, not less. Improved passenger-train steam engines made energy costs cheaper, and train ticket sales went up; people tend to drive efficient cars more; slashing calories from cookies inspires people to eat more of them. Likewise, when IT technology becomes more efficient, people use it more, but this also makes related activities, such as in-person work sessions, more useful, and those activities also become more frequent.

Advances in technology don’t make cities obsolete. The invention of the printing press in the 1400s created a new industry that burgeoned within urban areas, attracting builders, printers, writers, and publishers. Books quickly caused religious and social upheavals, along with a broadening of knowledge that led to increased trade and more demand for centralized production and shipping. Today, the Internet continues that tradition, opening up more information channels that, among other things, increase the demand for urban infrastructure and high-density offices where new ideas create new goods and services.

Detroit in 1950 was a thriving factory town of nearly two million, its workers churning out automobiles for the masses. Then foreign competition set in, technological advances reduced the need for so many employees, and the city began to fade. Other American cities suffered the same fate: Eight of the 10 biggest municipalities have lost population since 1950.

As the Industrial Age ended, many metropolitan areas in America and Europe neglected the main engine of urban growth and prosperity—smaller businesses that employ educated, creative workers. A few, like New York and Boston, have bounced back with policies that attract new businesses and reward entrepreneurial spirit. Other industrial cities tried instead to recover through massive building projects, but large cities that lose population need fewer buildings, not more.

In 1900, all 20 of the largest US cities were on rivers, because water transport is cheap. Detroit, on the Detroit River, lay athwart a major transit route that ran from New Orleans up the Mississippi River to the Illinois and Michigan Canal, then across the Great Lakes to western New York state, the Erie Canal, and the Hudson River down to New York City’s Atlantic shipping ports. These cities grew into “agglomeration economies” that benefited from clustering of resources—transport, raw materials, large working populations—and generated “returns to scale,” or cheaper per-unit costs, from mass production.

In the early 1900s, Detroit was the center of automotive technology. Henry Ford, Billy Durant, Ransom Olds, the Dodge Brothers, David Buick, and the Fisher Brothers began manufacturing cars and car parts. In 1913, Ford introduced the assembly line, which greatly improved car-making efficiency and required almost no skill from its workers. Detroit quickly transformed itself into “Motor City,” and the many car makers condensed into just a few, principally Ford and General Motors, that made vehicles in gigantic factories.

Unions, supported by the government, grew powerful and raised high their members’ wages. By the mid-1900s, overland transport had become much cheaper, and companies no longer had to base themselves in large, expensive cities, especially those with high labor costs. Businesses began to move away. This happened not only in Detroit but in major cities across America and Europe.

The problem with unskilled assembly-line manufacturing is that, “if people need to know less, they also have less need for cities that spread knowledge” (48). As manufacturing jobs declined, workers found themselves without the education, or the innovative companies, to provide them with new jobs. Tax revenues declined, as well as social services. Many urban centers with large African American populations, long suffering from institutional bias and lack of resources and opportunities, began to seethe. In the mid-1960s, riots erupted in several cities. Detroit in 1967 suffered a riot in which angry citizens destroyed 1,400 buildings, resulting in thousands arrested and 43 killed.

Some urban centers responded with new construction downtown, but this simply put a pretty, false face—a “Potemkin Village”—on a failing economy. The businesses and jobs didn’t come. One bright light was New York City, which lost 300,000 garment industry jobs and nearly lost its government to bankruptcy in 1975 but made a comeback, especially in the financial sector but also with business-friendly policies.

From the mid-1970s to the mid-1990s, African-American Coleman Young was mayor of Detroit, a man dedicated to righting the racial wrongs of many decades. However, it is hard “to right great social wrongs at the city level” (55), and Young’s huge building projects and high taxes on wealthy white residents caused a flight of capital from the city. Young tore down 1,400 houses and turned the land over to General Motors for a new high-tech factory, but the plant employs only 1,300 people. Though brash and popular—Young served five consecutive terms as mayor—his programs failed to solve the problems. The city needed more education and more new businesses, but a devastated city with cheap housing prices attracts only more of the working poor.

The “Curley Effect” defines a city leader who alienates a once-dominant ethnic group, causing them to move out and take with them much of the job-making business sector. Boston’s James Curley in the early 1900s vigorously defended working-class Irish-Americans against the established Protestant elite, driving away the wealthier Yankees and leaving the city poorer than ever. Coleman Young likewise alienated white residents, most of whom left his city, so that Detroit ended up mainly with under-schooled workers from the old assembly-line days.

Some cities in America and Europe have had success with innovative ideas. Spain built a high-speed rail line to ferry workers from outlying cities to Madrid; in the north, Bilbao’s Guggenheim museum has generated a tourist boom. Leipzig in Germany and Youngstown in Ohio have torn down thousands of vacant buildings and replaced them with parkland and open space, making those districts “more attractive, less dangerous, and cheaper to maintain” (66). Other cities have invested in amenities such as museums and art districts that they hope will attract better-educated workers and entrepreneurs.