Urban economics has traditionally viewed cities as having advantages in production and disadvantages in consumption. The researchers argue that the role of urban density in facilitating consumption is extremely important and understudied. As firms become more mobile, the success of cities hinges more and more on cities' role as centres of consumption.

Empirically, the researches find that high amenity cities have grown faster than low amenity cities. Urban rents have gone up faster than urban wages, suggesting that the demand for living in cities has risen for reasons beyond rising wages. The rise of reverse commuting suggests the same consumer city phenomena.

This basic viewpoint - that cities are good for production and bad for consumption- colours most of urban economics and has influenced most thinking on the future of cities. The critical questions about the future of cities have always been:

The researchers of this paper believe that too little attention has been paid to the role of cities as centres of consumption.

This paper argues that there are four particularly critical urban amenities. First, and most obviously, is the presence of a rich variety of services and consumer goods. The second amenity is aesthetics and physical setting. The third critical amenity is good public services. The fourth vital amenity is speed.

Edward L. Glaeser, tel. +1 6174962150

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01/06/2000

Edward L. Glaeser, Jed Kolko and Albert Saiz

research

Urban Policy > Economy knowledge & employment

Urban economy