Complex Economic Activities Concentrate in Large Cities

43 Pages Posted: 9 Aug 2018

See all articles by Pierre Alexandre Balland

Pierre Alexandre Balland

Utrecht University - Department of Economic Geography

Cristian Jara-Figueroa

Massachusetts Institute of Technology (MIT)

Sergio Petralia

London School of Economics & Political Science (LSE)

Mathieu Steijn

Utrecht University

David L. Rigby

University of California, Los Angeles (UCLA) - Department of Geography

Cesar Hidalgo

Massachusetts Institute of Technology (MIT) - MIT Media Laboratory; Harvard University - Harvard Kennedy School (HKS)

Date Written: July 24, 2018

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.

Keywords: Scaling, Complexity, Innovation

JEL Classification: O33, R11

Suggested Citation

Balland, Pierre Alexandre and Jara-Figueroa, Cristian and Petralia, Sergio and Steijn, Mathieu and Rigby, David L. and Hidalgo, Cesar, Complex Economic Activities Concentrate in Large Cities (July 24, 2018). Available at SSRN: https://ssrn.com/abstract=3219155 or http://dx.doi.org/10.2139/ssrn.3219155

Pierre Alexandre Balland

Utrecht University - Department of Economic Geography ( email )

Heidelberglaan 2
Utrecht
Netherlands

HOME PAGE: http://paballand.com

Cristian Jara-Figueroa

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Sergio Petralia (Contact Author)

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

Mathieu Steijn

Utrecht University ( email )

Vredenburg 138
Utrecht, 3511 BG
Netherlands

David L. Rigby

University of California, Los Angeles (UCLA) - Department of Geography ( email )

Los Angeles, CA
United States

Cesar Hidalgo

Massachusetts Institute of Technology (MIT) - MIT Media Laboratory ( email )

20 Ames St.
E14-348b
Cambridge, MA 02139-4307
United States
617-324-6680 (Phone)
617-258-6264 (Fax)

HOME PAGE: http://www.chidalgo.com/

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States
574-315-5494 (Phone)

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