Big or Small Cities? On City Size and Economic Growth by Susanne Frick and Andres Rodriguez-Pose

Big or Small Cities? On City Size and Economic Growth- Review.

Journal article authored by Susanne Frick and Andres Rodriguez-Pose.

Review by Daniel Stevens.

This journal article is a quantitative analysis of statistics between 1980 and 2010, relating to economic growth, city size and their relation.

What Frick and Rodriguez-Pose find is fascinating, whilst certain parts of the statistical anaylsis must be taken with a pinch of salt (primarily because of the low level of significance) what Rodriguez-Pose and Frick find is that their is potentially little correlation between city size and economic growth. Whilst this is not conclusive, and aspects of the data do support agglomeration economic theory, the statistics provided do demonstrate that the policymaker obsession with creating agglomeration economies may be unfounded.

In fact, this policy focus may be a complete misstep, as policies focusing on the megacities of a nation may be missing out on unlocking the economic potential of the smaller cities of that nation.

Going further, research should attempt to delve deeper into the type of economic growth being produced by these cities, as if smaller cities can facilitate economic growth which is more inclusive, and has less negative externalaties, perhaps a policy shift to focus on cities of this size can be argued for.

Whilst Frick and Rodriguez-Pose do not completely refute agglomeration economic theory, they do set the groundwork for academics to begin to rethink fundamental economic theories which have underpinned policy decisions for decades.