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    Triumph of the City

    Glaeser, Edward


    A pioneering urban economist offers fascinating, even inspiring proof that the city is humanity's greatest invention and our best hope for the future. America is an urban nation. More than two thirds of us live on the 3 percent of land that contains our cities. Yet cities get a bad rap: they're dirty, poor, unhealthy, crime ridden, expensive, environmentally unfriendly... Or are they? As Edward Glaeser proves in this myth-shattering book, cities are actually the healthiest, greenest, and richest (in cultural and economic terms) places to live. New Yorkers, for instance, live longer than other Americans; heart disease and cancer rates are lower in Gotham than in the nation as a whole. More than half of America's income is earned in twenty-two metropolitan areas. And city dwellers use, on average, 40 percent less energy than suburbanites. Glaeser travels through history and around the globe to reveal the hidden workings of cities and how they bring out the best in humankind. Even the worst cities-Kinshasa, Kolkata, Lagos- confer surprising benefits on the people who flock to them, including better health and more jobs than the rural areas that surround them. Glaeser visits Bangalore and Silicon Valley, whose strangely similar histories prove how essential education is to urban success and how new technology actually encourages people to gather together physically. He discovers why Detroit is dying while other old industrial cities-Chicago, Boston, New York-thrive. He investigates why a new house costs 350 percent more in Los Angeles than in Houston, even though building costs are only 25 percent higher in L.A. He pinpoints the single factor that most influences urban growth-January temperatures-and explains how certain chilly cities manage to defy that link. He explains how West Coast environmentalists have harmed the environment, and how struggling cities from Youngstown to New Orleans can "shrink to greatness." And he exposes the dangerous anti-urban political bias that is harming both cities and the entire country. Using intrepid reportage, keen analysis, and eloquent argument, Glaeser makes an impassioned case for the city's import and splendor. He reminds us forcefully why we should nurture our cities or suffer consequences that will hurt us all, no matter where we live.

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    Published by the Penguin Group

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    First published in 2011 by The Penguin Press, a member of Penguin Group (USA) Inc. ?

Copyright ? Edward Glaeser, 2011

    All rights reserved




Glaeser, Edward L. (Edward Ludwig),———.

    Triumph of the city : how our greatest invention makes us richer, smarter, greener, healthier, and happier / Edward L. Glaeser.

    p. cm.

    Includes bibliographical references and index.

    eISBN : 978-1-101-47567-6

    1. Urbanization. 2. Cities and townsGrowth. 3. Urban economics. 4. Urban sociology.

    I. Title.

    HT361.G53 2011

    307.76dc22 2010034609





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    To Nancy,

    for All the Days



    Our Urban Species


    Two hundred forty-three million Americans crowd together in the 3 percent of the country that is urban. Thirty-six million people live in and around Tokyo, the most productive metropolitan area in the world. Twelve million people reside in central Mumbai, and Shanghai is almost as large. On a planet with vast amounts of space (all of humanity could fit in Texaseach of us with a personal townhouse), we choose cities. Although it has become cheaper to travel long distances, or to telecommute from the Ozarks to Azerbaijan, more and more people are clustering closer and closer together in large metropolitan areas. Five million more people every month live in the cities of the developing world, and in 2011, more than half the world’s population is urban.

    Cities, the dense agglomerations that dot the globe, have been engines of innovation since Plato and Socrates bickered in an Athenian marketplace. The streets of Florence gave us the Renaissance, and the streets of Birmingham gave us the Industrial Revolution. The great prosperity of contemporary London and Bangalore and Tokyo comes from their ability to produce new thinking. Wandering these citieswhether down

    cobblestone sidewalks or grid-cutting cross streets, around roundabouts or under freewaysis to study nothing less than human progress.

    In the richer countries of the West, cities have survived the tumultuous end of the industrial age and are now wealthier, healthier, and more alluring than ever. In the world’s poorer places, cities are expanding enormously because urban density

    provides the clearest path from poverty to prosperity. Despite the technological breakthroughs that have caused the death of distance, it turns out that the world

isn’t flat; it’s paved.

    The city has triumphed. But as many of us know from personal experience, sometimes city roads are paved to hell. The city may win, but too often its citizens seem to lose. Every urban childhood is shaped by an onrush of extraordinary people and experiencessome delicious, like the sense of power that comes from a preteen’s

    first subway trip alone; some less so, like a first exposure to urban gunfire (an unforgettable part of my childhood education in New York City thirty-five years ago). For every Fifth Avenue, there’s a Mumbai slum; for every Sorbonne, there’s a D.C. high school guarded by metal detectors.

    Indeed, for many Americans, the latter half of the twentieth centurythe end of the

    industrial agewas an education not in urban splendor but in urban squalor. How well we learn from the lessons our cities teach us will determine whether our urban species will flourish in what can be a new golden age of the city.

    My passion for the urban world began with the New York of Ed Koch, Thurman Munson, and Leonard Bernstein. Inspired by my metropolitan childhood, I’ve spent my life

    trying to understand cities. That quest has been rooted in economic theory and data, but it has also meandered through the streets of Moscow and S?o Paulo and Mumbai, through the histories of bustling metropolises and the everyday stories of those who live and work in them.

    I find studying cities so engrossing because they pose fascinating, important, and often troubling questions. Why do the richest and poorest people in the world so often live cheek by jowl? How do once-mighty cities fall into disrepair? Why do some stage dramatic comebacks? Why do so many artistic movements arise so quickly in particular cities at particular moments? Why do so many smart people enact so many foolish urban policies?

    There’s no better place to ponder these questions than what many consider to be the

    archetypal cityNew York. Native New Yorkers, like myself, may occasionally have a slightly exaggerated view of their city’s importance, but New York is still a paradigm of urbanity and therefore an appropriate place to start our journey to cities across the world. Its story encapsulates the past, present, and future of our urban centers, and provides a springboard for many of the themes that will emerge from the pages and places ahead.

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    If you stand on Forty-seventh Street and Fifth Avenue this Wednesday afternoon, you’ll be surrounded by a torrent of people. Some are rushing uptown for a meeting or downtown to grab a drink. Others are walking east to enter the great subterranean caverns of Grand Central Terminal, which has more platforms than any other train station in the world. Some people may be trying to buy an engagement ringafter all,

    Forty-seventh Street is the nation’s premier market for gems. There will be visitors

    gazing upwardsomething New Yorkers never doon their way from one landmark to

    another. If you imitate a tourist and look up, you’ll see two great ridges of skyscrapers framing the shimmering valley that is Fifth Avenue.

    Thirty years ago, New York City’s future looked far less bright. Like almost every

    colder, older city, Gotham seemed to be a dinosaur. The city’s subways and buses felt archaic in a world being rebuilt around the car. The city’s port, once the glory of the Eastern seaboard, had sunk into irrelevance. Under the leadership of John Lindsay and Abe Beame, the city’s government had come near default despite having some of the highest taxes in the nation. Not just Jerry Ford, but history itself seemed to be telling New York City to drop dead.

    New York, or more properly New Amsterdam, was founded during an earlier era of globalization as a distant outpost of the Dutch West India Company. It was a trading village where a hodgepodge of adventurers came to make fortunes swapping beads for furs. Those mercantile Dutch settlers clustered together because proximity made it easier to exchange goods and ideas and because there was safety behind the town’s protective wall (now Wall Street).

    In the eighteenth century, New York passed Boston to become the English colonies’

    most important port; it specialized in shipping wheat and flour south to feed the sugar and tobacco colonies. During the first half of the nineteenth century, with business booming, New York’s population grew from sixty thousand to eight hundred

    thousand, and the city became America’s urban colossus.

    That population explosion was partly due to changes in transportation technology. At the start of the nineteenth century, ships were generally smallthree hundred

    tons was a normal sizeand, like smaller airplanes today, ideal for point-to-point trips, like Liverpool to Charlestown or Boston to Glasgow. Between 1800 and 1850, improvements in technology and finance brought forth larger ships that could carry bigger loads at faster speeds and lower cost.

    There was no percentage in having these jumbo clipper ships traveling to every point along the American coast. Just like today’s Boeing 747s, which land at major hubs and transfer their passengers onto smaller planes that take them to their final destinations, the big clipper ships came to one central harbor and then transferred their goods to smaller vessels for delivery up and down the Eastern seaboard. New York was America’s superport, with its central location, deep, protected harbor,

    and river access far into the hinterland. When America moved to a hub-and-spoke shipping system, New York became the natural hub. The city’s position was only strengthened when canals made Manhattan the eastern end of a great watery arc that cut through the Midwest all the way to New Orleans.

    Shipping was the city’s economic anchor, but New Yorkers were more likely to work in the manufacturing industriessugar refining, garment production, and

    publishingthat grew up around the harbor. Sugar producers, like the Roosevelt family, operated in a big port city, because urban scale enabled them to cover the fixed costs of big, expensive refineries and to be close enough to consumers so that refined sugar crystals wouldn’t coalesce during a long, hot water voyage. The garment

    industry similarly owed its concentration in New York to the vast cargoes of cotton and textiles that came through the city and sailors’ need for ready-made clothes.

    Even New York’s publishing preeminence ultimately reflected the city’s central place on transatlantic trade routes, as the big money in nineteenth-century books came from being the first printer out with pirated copies of English novels. The Harper

    brothers really arrived as publishers when they beat their Philadelphia competitors by printing the third volume of Walter Scott’s Peveril of the Peak twenty-one hours

    after it arrived in New York by packet ship.

    In the twentieth century, however, the death of distance destroyed the transport-cost advantages that had made New York a manufacturing mammoth. Why sew skirts on Hester Street when labor is so much cheaper in China? Globalization brought fierce competition to the companies and cities that made anything that could be easily shipped across the Pacific. New York’s economic decline in the midtwentieth century reflected the increasing irrelevance of its nineteenth-century advantages. But of course, as anyone standing on Fifth Avenue today must notice, the story didn’t end there. New York didn’t die. Today, the five zip codes that occupy the mile of

    Manhattan between Forty-first and Fifty-ninth streets employ six hundred thousand workers (more than New Hampshire or Maine), who earn on average more than $100,000 each, giving that tiny piece of real estate a larger annual payroll than Oregon or Nevada.

    Just as globalization killed off New York’s advantages as a manufacturing hub, it increased the city’s edge in producing ideas. While there isn’t much sewing left in New York, there are still plenty of Calvin Kleins and Donna Karans, producing designs that will often be made on the other side of the planet. Honda may have brought heartache to Detroit’s Big Three, but managing the international flow of finance has earned vast sums for New York’s bankers. A more connected world has brought huge

    returns to the idea-producing entrepreneurs who can now scour the earth in search of profits.

    New York reinvented itself during the bleak years of the 1970s when a cluster of financial innovators learned from each other and produced a chain of interconnected ideas. Academic knowledge about trading off risk and return made it easier to evaluate and sell riskier assets, like Michael Milken’s high-yield (junk) bonds, which made

    it possible for Henry Kravis to use those bonds to get value out of underperforming companies through leveraged buyouts. Many of the biggest innovators acquired their knowledge not through formal training but by being close to the action, like mortgage-backed security magnate Lewis Ranieri of Liar’s Poker fame, who started

    in the Salomon Brothers mailroom. Today, 40 percent of Manhattan’s payroll is in the financial services industry, the bulwark of a dense and still-thriving city. And even though some of these financial wizards helped give us the Great Recession, the city that housed them has weathered that storm, too. Between 2009 and 2010, as the American economy largely stagnated, wages in Manhattan increased by 11.9 percent, more than any other large county. In 2010, the average weekly wage in Manhattan was $2,404, which is 170 percent more than the U.S. average, and 45 percent more than in Santa Clara County, home of Silicon Valley, which pays the highest wages outside of Greater New York.

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    The rise and fall and rise of New York introduces us to the central paradox of the modern metropolisproximity has become ever more valuable as the cost of connecting

across long distances has fallen. New York’s story is unique in its operatic grandeur,

    but the key elements that drove the city’s spectacular rise, sad decline, and remarkable rebirth can be found in cities like Chicago and London and Milan, as well. In this book, we’ll look closely at what makes cities our species’ greatest invention. We’ll also unpack their checkered history, which is relevant now because so many cities in the developing world struggle with the vast challenges that once plagued today’s urban stars like San Francisco, Paris, and Singapore. And we’ll examine the often surprising factors that shape the success of today’s cities—from

    winter temperatures to the Internet to misguided environmentalism.

    Cities are the absence of physical space between people and companies. They are proximity, density, closeness. They enable us to work and play together, and their success depends on the demand for physical connection. During the middle years of the twentieth century, many cities, like New York, declined as improvements in transportation reduced the advantages of locating factories in dense urban areas. And during the last thirty years, some of these cities have come back, while other, newer cities have grown because technological change has increased the returns to the knowledge that is best produced by people in close proximity to other people. Within the United States, workers in metropolitan areas with big cities earn 30 percent more than workers who aren’t in metropolitan areas. These high wages are offset by higher costs of living, but that doesn’t change the fact that high wages

    reflect high productivity. The only reason why companies put up with the high labor and land costs of being in a city is that the city creates productivity advantages that offset those costs. Americans who live in metropolitan areas with more than a million residents are, on average, more than 50 percent more productive than Americans who live in smaller metropolitan areas. These relationships are the same even when we take into account the education, experience, and industry of workers. They’re even the same if we take individual workers’ IQs into account. The income gap between urban and rural areas is just as large in other rich countries, and even stronger in poorer nations.

    In America and Europe, cities speed innovation by connecting their smart inhabitants to each other, but cities play an even more critical role in the developing world: They are gateways between markets and cultures. In the nineteenth century, Mumbai (then called Bombay) was a gateway for cotton. In the twenty-first century, Bangalore is a gateway for ideas.

    If you mentioned India to a typical American or European in 1990, chances are that person would mutter uncomfortably about the tragedy of Third World poverty. Today, that person is more likely to mutter uncomfortably about the possibility that his job might be outsourced to Bangalore. India is still poor, but it’s growing at a feverish pace, and Bangalore, India’s fifth-largest city, is among the

    subcontinent’s greatest success stories. Bangalore’s wealth comes not from industrial might (although it still makes plenty of textiles) but from its strength as a city of ideas. By concentrating so much talent in one place, Bangalore makes it easier for that talent to teach itself and for outsiders, whether from Singapore or Silicon Valley, to connect easily with Indian human capital.

    Echoing antiurbanites throughout the ages, Mahatma Gandhi said that “the true India is to be found not in its few cities, but in its 700,000 villages” and “the growth of the nation depends not on cities, but [on] its villages.” The great man was wrong.

    India’s growth depends almost entirely on its cities. There is a near-perfect

    correlation between urbanization and prosperity across nations. On average, as the share of a country’s population that is urban rises by 10 percent, the country’s per capita output increases by 30 percent. Per capita incomes are almost four times higher in those countries where a majority of people live in cities than in those countries where a majority of people live in rural areas.

    There is a myth that even if cities enhance prosperity, they still make people miserable. But people report being happier in those countries that are more urban. In those countries where more than half of the population is urban, 30 percent of people say that they are very happy and 17 percent say that they are not very or not at all happy. In nations where more than half of the population is rural, 25 percent of people report being very happy and 22 percent report unhappiness. Across countries, reported life satisfaction rises with the share of the population that lives in cities, even when controlling for the countries’ income and education.

    So cities like Mumbai and Kolkata and Bangalore boost not only India’s economy, but its mood. And certainly they are not un-Indian, any more than New York is un-American. These cities are, in so many ways, the places where their nation’s genius is most fully expressed.

    The urban ability to create collaborative brilliance isn’t new. For centuries, innovations have spread from person to person across crowded city streets. An explosion of artistic genius during the Florentine Renaissance began when Brunelleschi figured out the geometry of linear perspective. He passed his knowledge to his friend Donatello, who imported linear perspective in lowrelief sculpture. Their friend Masaccio then brought the innovation into painting. The artistic innovations of Florence were glorious side effects of urban concentration; that city’s wealth came from more prosaic pursuits: banking and cloth making. Today,

    however, Bangalore and New York and London all depend on their ability to innovate. The spread of knowledge from engineer to engineer, from designer to designer, from trader to trader is the same as the flight of ideas from painter to painter, and urban density has long been at the heart of that process.

    The vitality of New York and Bangalore doesn’t mean that all cities will succeed. In 1950, Detroit was America’s fifth-largest city and had 1.85 million people. In

    2008, it had 777 thousand people, less than half its former size, and was continuing to lose population steadily. Eight of the ten largest American cities in 1950 have lost at least a fifth of their population since then. The failure of Detroit and so many other industrial towns doesn’t reflect any weakness of cities as a whole, but rather the sterility of those cities that lost touch with the essential ingredients of urban reinvention.

    Cities thrive when they have many small firms and skilled citizens. Detroit was once a buzzing beehive of small-scale interconnected inventorsHenry Ford was just one

    among many gifted entrepreneurs. But the extravagant success of Ford’s big idea

destroyed that older, more innovative city. Detroit’s twentieth-century growth

    brought hundreds of thousands of less-well-educated workers to vast factories, which became fortresses apart from the city and the world. While industrial diversity, entrepreneurship, and education lead to innovation, the Detroit model led to urban decline. The age of the industrial city is over, at least in the West. Too many officials in troubled cities wrongly imagine that they can lead their city back to its former glories with some massive construction projecta new stadium or

    light rail system, a convention center, or a housing project. With very few exceptions, no public policy can stem the tidal forces of urban change. We mustn’t ignore the needs of the poor people who live in the Rust Belt, but public policy should help poor people, not poor places.

    Shiny new real estate may dress up a declining city, but it doesn’t solve its underlying problems. The hallmark of declining cities is that they have too much housing and infrastructure relative to the strength of their economies. With all that supply of structure and so little demand, it makes no sense to use public money to build more supply. The folly of building-centric urban renewal reminds us that cities aren’t structures; cities are people.

    After Hurricane Katrina, the building boosters wanted to spend hundreds of billions rebuilding New Orleans, but if $200 billion had been given to the people who lived there, each of them would have gotten $400,000 to pay for moving or education or better housing somewhere else. Even before the flood, New Orleans had done a mediocre job caring for its poor. Did it really make sense to spend billions on the city’s infrastructure, when money was so badly needed to help educate the children of New Orleans? New Orleans’ greatness always came from its people, not from its buildings.

    Wouldn’t it have made more sense to ask how federal spending could have done the most for the lives of Katrina’s victims, even if they moved somewhere else?

    Ultimately, the job of urban government isn’t to fund buildings or rail lines that can’t possibly cover their costs, but to care for the city’s citizens. A mayor who can better educate a city’s children so that they can find opportunity on the other side of the globe is succeeding, even if his city is getting smaller. While the unremitting poverty of Detroit and cities like it clearly reflects urban distress, not all urban poverty is bad. It’s easy to understand why a visitor to a Kolkata slum might join Gandhi in wondering about the wisdom of massive urbanization, but there’s a lot to like about urban poverty. Cities don’t make people poor; they attract poor people. The flow of less advantaged people into cities from Rio to Rotterdam demonstrates urban strength, not weakness.

    Urban structures may stand for centuries, but urban populations are fluid. More than a quarter of Manhattan’s residents didn’t live there five years ago. Poor people constantly come to New York and S?o Paulo and Mumbai in search of something better, a fact of urban life that should be celebrated.

    Urban poverty should be judged not relative to urban wealth but relative to rural poverty. The shantytowns of Rio de Janeiro may look terrible when compared to a prosperous Chicago suburb, but poverty rates in Rio are far lower than in Brazil’s rural northeast. The poor have no way to get rich quick, but they can choose between

    cities and the countryside, and many of them sensibly choose cities. The flow of rich and poor into cities makes urban areas dynamic, but it’s hard to miss the costs of concentrated poverty. Proximity makes it easier to exchange ideas or goods but also easier to exchange bacteria or purloin a purse. All of the world’s

    older cities have suffered the great scourges of urban life: disease, crime, congestion. And the fight against these ills has never been won by passively accepting the way things are or by mindlessly relying on the free market. American cities became much healthier in the early twentieth century because they were spending as much on water as the federal government spent on everything except the military and the postal service. The leaps made by European and American cities will likely be repeated in the developing cities of the twenty-first century, and that will only make the world more urban. New York City, where boys born in 1901 were expected to live seven years fewer than their American male counterparts, is now considerably healthier than America as a whole.

    The urban victories over crime and disease made it possible for cities to thrive as places of pleasure as well as productivity. Urban scale makes it possible to support the fixed costs of theaters, museums, and restaurants. Museums need large expensive exhibits and attractive, often expensive structures; theaters need stages, lighting, sound equipment, and plenty of practice. In cities, these fixed costs become affordable because they’re shared among thousands of museum visitors and theatergoers.

    Historically, most people were far too poor to let their tastes in entertainment guide where they chose to live, and cities were hardly pleasure zones. Yet as people have become richer, they have increasingly chosen cities based on lifestyleand the

    consumer city was born.

    During much of the twentieth century, the rise of consumer cities like Los Angeles seemed to be yet another force battering the Londons and New Yorks of the world. Yet as older cities have become safer and healthier, they, too, became reinvigorated as places of consumption, through restaurants, theaters, comedy clubs, bars, and the pleasures of proximity. Over the past thirty years, London and San Francisco and Paris have all boomed, in part, because people have increasingly found them fun places to live. These metropolises have their pricey treats, like Michelin Guide three-star meals, but they also have their more affordable enjoyments, like sipping a coffee while admiring the Golden Gate Bridge or the Arc de Triomphe, or downing a real ale in a woodpaneled pub. Cities enable us to find friends with common interests, and the disproportionately single populations in dense cities are marriage markets that make it easier to find a mate. Today successful cities, old or young, attract smart entrepreneurial people, in part, by being urban theme parks.

    The rise of reverse commuting may be the most striking consequence of successful consumer cities. In the dark days of the 1970s, few were willing to live in Manhattan if they didn’t work there. Today, thousands of people choose to live in the city and travel to jobs outside it. Middle Eastern millionaires aren’t the only people buying pieds-à-terre in London and New York, and Miami has done well by selling second homes to the rich of Latin America.

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