Save America’s Dying Cities

What accounts for the success and continued thriving of some cities, and the decline of others? During the decade when I ran the Ewing Marion Kauffman Foundation, as we developed a data-based research agenda on the phenomenon of entrepreneurship, I became impressed by differences in rates of business formation, from city to city. Controlling for population, it was clear that certain locales were home to more new businesses, a widely accepted surrogate of innovation and, in turn, economic growth and social well-being.

One of the marvels of America’s economic history is how widely distributed genius appears to have been. One might expect more “smart” people in New York because of its size, but New York has had no greater per capita claim to commercial creativity. Many cities, among them Chicago in the mid-nineteenth century and Detroit in the 1920s, had spells of growing both new businesses and per capital wealth much faster. Such spells of innovation were also accompanied by a growing population. Read Full Article »