Population size seen as key driver of a strong urban economy.
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A new study from the Kellogg School of Management at Northwestern University revealed a unique historical pattern that cities follow in order to become strong and innovative economies.
Population size seems to be the key driver propelling urban economies to new heights, according to Hyejin Youn, assistant professor of management and organizations at Kellogg and the corresponding author on the study.
The researchers analyzed industrial employment and population changes in 350 U.S. cities between 1998 and 2013, including over 100 million workers.
They observed a transition to innovative economies when the population reaches 1.2 million people.
Another key factor in that transition is also the ability of the city to attract and retain certain industries that tend to grow much faster compared to population growth. Some of these industries include arts, entertainment, professional services, science, and information technology. Youn calls these “superlinear industries.”
“What we observed is not a blip in history,” Youn said. “These two factors go hand in hand and depend on one another.”
Sublinear industries are those whose growth rate is less than the population size. These include primary industries such as fishing, agriculture, mining and manufacturing.
“These are industries that need geographical resources in order to grow, which obviously doesn’t scale with the size of the city,” Youn said. “They’re also less dependent on human interaction and population.”
According to Youn, human interactions are known to drive the creation of ideas. In other words, innovation somehow depends on the rate of human interaction, which is pushed forward by population size.[…]
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