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I’m at the Living Cities 20th Anniversary today, liveblogging on the discussions that panelists are having here. This post, a little out of the vein of the topics we typically talk about at Market Urbanism, originally appeared at Next American City. Steven Johnson and Paula Ellis, of the John S. and James L. Knight Foundation, discussed some of the themes in his new book, Where Good Ideas Come From: The Natural History of Innovation, including the unique environment for innovation that cities provide. Johnson draws on the work of Jane Jacobs and Geoffrey West to demonstrate that innovation is most likely to happen in places where humans are densely clustered because entrepreneurs rely on the work of others. Both to see through the uncertainties of the future to realize profitable ideas, and to overcome the challenges of product development, entrepreneurs need to live in urban areas. Johnson began his conversation explaining that many of the ideals that emerged in the Scottish Enlightenment came out of coffeehouses, through the spontaneous conversations that many brilliant men had, and the evolution of their ideas in this urban space. Looking back to these Enlightenment ideals, we can see that Adam Smith, perhaps one of the original urbanists, explained that the division of labor is limited by the size of the market. Continued urban growth provides individuals with growing opportunities to specialize, as both the consumers and technological developments that fuel the market process are consolidated in the same place. In West’s work that Johnson referenced, he explains that, unlike firms that become increasingly bureaucratic and inefficient as they grow, cities continue to become more productive as they grow in size and density. As Johnson explained, cities have a “liquid property because they have the convergence of diverse people sharing a space. This is an incredible asset.” […]

I’m at the Living Cities 20th Anniversary today, liveblogging on the discussions that panelists are having here. This post, a little out of the vein of the topics we typically talk about at Market Urbanism, originally appeared at Next American City. Patrick McCarthey of the Annie E. Casey Foundation articulated one of the missions of the Living Cities collaboration as helping Americans in the bottom 40 percent of the income distribution. As the collaboration seeks to help cities develop, it also seeks to improve the development of human capital in these communities. To this point, Dudley Benoit of JP Morgan Chase suggested that improved efficiency in capital markets is key to achieving this goal. While microfinance has flourished in developing countries, investors have not been as eager to provide small loans to small businesses in the United States. While philanthropic organizations focused on community development have often focused on the making top-down improvements to the physical landscape of urbanities, Benoit brings up that the human capital that allows cities to facilitate economic innovation is more important than their physical components, and that economic development must be a bottom-up process. Living Cities’ President and CEO Ben Hecht points out that no one individual can solve the problems that a city poses – as Jane Jacobs and Friedrich Hayek both identified, complex human systems must draw on decentralized knowledge that cannot be centrally compiled. Access to capital for urban entrepreneurs is essential for the economic rebirth of cities that Living Cities fosters.  

In July, Adam, Stephen, and I did a podcast with Jake from The Voluntary Life about the book The Voluntary City with Peter Gordon, one of the book’s editors. We had an interesting discussion, including some debate about transportation funding and free market solutions for inner cities. The podcast is now available in three parts on Jake’s blog.

During the past few decades, “industrial policy” was an epithet, and you still won’t see Obama going around calling his “green jobs” projects industrial policy in speeches any time soon. But some think it’s time to shed the stigma, and the flagship Obama industrial policy seems to be electric vehicles – or more specifically, the batteries that power them: “It was a calculated risk — a lot of money, to be sure, but given the stakes, I think it was a pretty thoughtful bet,” says Ron Bloom, who recently served as an assistant to President Obama for manufacturing policy. “If vehicle electrification really does take off, as many, many people think it will, and we’re not part of it, then we could lose our leadership of the global automobile industry.” Which would be catastrophic. By some estimates, as much as 20 percent of all manufacturing jobs are directly or indirectly related to the automobile industry. Bloom points out that the United States is not the only country betting on batteries; a number of Asian countries have done so as well. And if a bunch of Asian countries jumped off a bridge, would you do it too? The Times calls it “less like Google and more like Ford,” and I’m not sure if they mean that as a bad thing. I’m not going to lay out a long case against electric cars right now, but suffice it to say I think they’re just another subsidy to the auto-based system, and that the true environmental harm in cars is not their actual emissions, but the land use patterns than they necessitate, and an electric battery doesn’t change this one bit. I’m certainly not going to lay the blame on urbanists for Obama’s electric car infatuation, but I think it should be a wake-up […]