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The Economy of Cities by Jane Jacobs

The Economy of Cities (1969)

by Jane Jacobs

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iconoclastic; comprehensive, yet very personal history of urban development
  FKarr | Apr 5, 2013 |
In this book, Jane Jacobs brings her creative mind and sharp wit to bear on the question of how cities grow economically. While there's a lot of wisdom here, it demands an unusual style of reading. Jacobs was not a scientist or economist in a formal modern manner; rather, she had more in common intellectually with the natural philosophers of an earlier era. That is, rather than proposing a hypothesis and testing it against econometric analysis, Jacobs observes, keenly, and discerns a mechanism that explains what she sees. Early in the book, Jacobs offers an explanation of how the first cities came to initiate economic growth. It reads like a modern version of social contract theory: philosophically credible, but not really true in an historical sense.

Jacobs' writing is always stimulating, and she offered key insights into social order decades before they became widely appreciated. For example, the final chapter of Jacobs' better known Death and Life of Great American Cities discusses cities as iterative, nonlinear systems, decades before those became a hip topic of academic study in the 1990s. In The Economy of Cities, Jacobs correctly predicts the rise of services, and also nails the function of the Long Tail as a source of economic growth. But, she uses her own term, 'growth through product differentiation', which she identifies as the next major form of economic growth after an economy exhausts the possibilities of mass production.

The core point of the book is that cities develop new work first by manufacturing goods that displace imports, and later by budding new products (or services) off of current manufactures. Overarching efficiency in production spells the death of this process, triggering economic stagnation. Jacobs notes the importance of venture capital that is willing to take risks and bankroll new industries without trying to rationalize them or add them to existing calcified corporate structures. There's a lot more as well, including some assertions about poverty and population growth that have since been shown to be wrong.

As a thinker and writer, Jacobs is really in a category of her own. I find reading her books takes real concentration, and sometimes several re-reads, despite the lucidity of her prose. Her combination of liberal values and deep distrust of government, so reflective of her struggles against Robert Moses and modernist planning, jars in the context of current political fights, in which liberals are generally trying to protect government from right-wing attacks. Nonetheless, Jacobs' grasp of patterns of order - spatial and economic - is so rich and so incisive that it justifies the effort to absorb it fully. ( )
  bezoar44 | Dec 18, 2012 |
Professor Alison Wolf, specialist in the relationship between education and the labour market, has chosen to discuss Jane Jacobs’ The Economy of Cities , on FiveBooks (http://five-books.com) as one of the top five on her subject - Education and Society, saying that:

“…Jane Jacob’s argument was that cities, which in the early days were just small trading and administrative posts, generated agriculture, not vice versa. Cities are where the ideas all come from, where all the wealth comes from. They are also much more environmentally friendly because you use much less energy if you live in the city than if you live out in the countryside..…”.

The full interview is available here: http://thebrowser.com/books/interviews/alison-wolf ( )
  FiveBooks | Feb 24, 2010 |
This book is another example of Jane Jacobs’ clear and frequently different thinking. It provides some insights into the growth of cities that usually overlooked. As an example, one new idea here is that cities don’t happen because of agriculture, but that most advances in agriculture have been due to cities. I believe that her insights don’t get nearly enough attention. First they are sometime counterintuitive, and second they frequently disagree with experts. She doesn’t have a degree in a related area; she’s just a housewife with brains, eyes, and ideas; ideas that show many of the experts to be wrong. Then she has the audacity to give examples.

While her better known "The Death and Life of Great American Cities" can be thought of as the ‘what’ of cities, this one is the ‘how’ they grow, and is a must read if you desire that answer. ( )
  ServusLibri | Feb 3, 2009 |
I feel bad for books like these. Jacobs is so well known for The Death and Life of Great American Cities and her last, Dark Age Ahead, that most people overlook her work on economics. This book, The Economy of Cities, combined with her next, Cities and the Wealth of Nations are some of her best work.

When approaching this book, keep in mind that Jacobs is an empiricist. She does a lot of research for her books and tends to build up from many, many examples in order to prove her points. When her research comes against conventional wisdom or long-worshipped theory (e.g. Adam Smith's The Wealth of Nations), she has no problem providing counterexamples to swiftly dispatch old, dusty notions and better explain old generalities that had long been glossed over, without being fully understood. ( )
  thebookpile | Apr 25, 2008 |
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"I will tell the story as I go along
of small cities no less than of great.
Most of those that were great once
are small today; and those which in
my own lifetime have grown to greatness,
were small enough in the old days.
To Betty, John, Jim & our mother & father
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This book is an outcome of my curiosity about why some cities grow and why others stagnate and decay.
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