Complex Economic Activities Concentrate in Large Cities

Abstract

Why do some economic activities agglomerate more than others? And, why does the agglomeration of some economic activities continue to increase despite recent developments in communication and transportation technologies? In this paper, we present evidence that complex economic activities concentrate more in large cities. We find this to be true for technologies, scientific publications, industries, and occupations. Using historical patent data, we show that the urban concentration of complex economic activities has been continuously increasing since 1850. These findings suggest that the increasing urban concentration of jobs and innovation might be a consequence of the growing complexity of the economy.

Technological complexity and economic growth of regions

“…Broekel (2019) adds to this by notion, finding competences in complex technologies as being concentrated in space. Importantly, such concentrations are not randomly distributed in space, but rather seem to be increasingly be found in urban agglomerations (Balland et al, 2020).…”

Delineating Functional Labour Market Areas With Estimable Classification Stabilities

“…We use tools from network science to study the spatial extent of labour market interactions. Previous studies apply similar tools to analyse how such interactions contribute to growth (Davies & Maré, 2020;Rigby, Roesler, Kogler, Boschma, & Balland, 2019), innovation (Balland, Boschma, Crespo, & Rigby, 2019), and knowledge and skill concentration (Balland & Rigby, 2017;Balland, et al, 2020). Our method for delineating functional LMAs supports future such studies by providing a conceptually robust and measurably stable means of identifying distinct areas in which workers and firms interact.…”

Collaboration networks, geography and innovation: Local and national embeddedness

“…Extensive literature has indeed reported considerable advantages of geographic agglomeration in many types of economic activities, including knowledge creation (Almeida & Kogut, 1999; Bettencourt, Lobo, & Strumsky, 2007; Glaeser, 1999; Jaffe et al, 1993). Furthermore, complex and innovative activities are highly concentrated and they have progressively evolved towards greater geographic concentration (Balland, Jara‐Figueroa, et al, 2020).…”