9 Density

Density is not the enemy

Vertical, centralized density = bad
Broad, decentralized human scaled density = good
No one wants blade runner cities
(twitter)

9.1 Agglomeration effects

Smith

Agglomeration effects are pretty simple to understand. Companies want to be located close to their customers, workers, and suppliers. People — who are both workers and customers — want to be located close to their employers and to the companies that sell them stuff. And financial capital wants to send money to where companies are locating their factories and offices. Taken all together, these effects are a powerful reason that cities exist, and that economic activity clusters in certain countries. When you add in clustering effects — the tendency of companies in the same industry to locate nearby to each other — the effect on the concentration becomes even more powerful.

Agglomeration in a particular region tends to have a “break point”, where a rapid snowballing of economic growth suddenly comes into effect. This explains why Asia’s growth in general has looked unstoppable in recent decades — the region has become the workshop of the world.

[Smith (2023) Here comes India](https://www.noahpinion.blog/p/herecomesindia