Urban Dynamics: The Power of Place in the Creative Age

The Role of Cities in Innovation and Diversity

Cities and regions are an important issue for sociologists, economists, and urbanists. Marshall, Robert Park, and Jane Jacobs have seen cities as cauldrons of diversity and difference and as fonts for creativity and innovation. "Great cities have always been melting pots of races and cultures," said Park, Burgess, and MacKenzie (1925).

Over the last decades, students have forgotten the creativity and innovation among other basic themes.

Why Geography Is Not Dead

With the internet and modern telecommunication and transportation systems, it might seem that it is no longer necessary for people to be together to work, and then they won't be. "The new economy operates in a space rather than a place," said Kelly in his book "New Rules for the New Economy."

However, not only do people remain highly concentrated, but the economy itself continues to concentrate in specific places, from Austin and Silicon Valley to New York and Hollywood. Research indicates that place and community are more critical factors than ever before.

Agglomeration and Cluster Theories

Many researchers, sociologists, and academics have theorized the importance of place in economic and social life. Place remains important as a locus of economic activity because of the tendency of firms to cluster together. Alfred Marshall argued that firms agglomerate to gain productive efficiencies. Some experts believe that clustering captures efficiencies generated from linkages between firms, while others suggest this is positive due to co-location and face-to-face contact. The competitive advantages for companies today are driving the economy of the Creative Age.

The Social Capital Perspective

An alternative view is based on Robert Putnam’s social capital theory. Regional growth is associated with tight-knit communities where people and firms form and share strong ties. He suggests that people become increasingly disconnected from one another and from their communities.

Another observation is that the factors generating economic prosperity are very different from the communities of the past. Places with dense ties and high levels of traditional social capital provide advantages to insiders and thus promote stability.