The stunning election of Donald Trump as president throws the future of urban policy into doubt. During the campaign he promised to bring new jobs and improved infrastructure to the inner cities, but so far he has furnished no details. Some of the strategies carried out by cities and states in the past may offer the incoming administration some guidance.
The New Geography of Jobs (Enrico Moretti)
Written by The Economic Development CurmudgeonAmerica's new geographical map shows growing differences, not just between people, but between communities (p.3). A handful of cities with 'right' industries and a solid base of human capital keep attracting good employers and offering high wages, while those at the other extreme, cities with the 'wrong' industries and a limited human capital base, are struck with dead-end jobs and low average wages. This 'Great Divergence' has its origins in the 1980's when American cities started to be defined by their resident's level of education (p.4). This Great Divergence in educational levels is causing an equally large divergence in labor productivity and salaries (p.4). But a worker's education affects not only his own salary, but the also affects the entire community in which he resides by altering the kinds of jobs available (in the community) and the productivity of those who live in the community. This ensures that high wages for skilled workers also results in higher wages for all workers in the community (pp. 4-5). The Curmudgeon's PhD raises the wages of the deli worker who made his lunch. (Once you know this, there is no need to tip) "The sorting of highly educated Americans into some communities, and less educated Americans into others tends to magnify and exacerbate all other socioeconomic differences (life expectancy, divorce rates, crime and politics and electoral behavior) For Moretti, the knowledge economy has an inherent tendency toward geographical agglomeration (i.e. those with knowledge tend to live and work in knowledge-based communities, or [(Curmudgeon here) they avoid dumb communities]. The success of a city attracting knowledge-based workers fosters more success "as communities that can attract skilled workers and good jobs tend to attract even more. Communities that fail to attract skilled workers lose further ground" Moretti further elaborates on what works and what doesn't as remedies to the Great Divergence and its Geography of Inequality. The Curmudgeon provides a sharp, critique, driven by his fear of what may be the natural social, economic and political consequences of the Great Divergence and its Geography of Inequality Continue Reading...