Why do cities prosper and why do cities fall? This is undoubtedly a complicated question, but research into the spatial structure of cities provides us with a framework for investigation.
The theory of agglomeration tells us that firms colocate in urban areas to benefit from economies of scale and network effects. This creates "sticky places" that easily attract and retain new firms.
Economic geographer Ann Markusen describes four spatial structures of sticky places. Two of those models --the 'Marshallian Industrial District' and the 'Hub and Spoke'--are well represented in the US. Marshallian Industrial Districts (Silicon Valley) and Hub and Spokes (Seattle) differ greatly in their dependence on individual industries, with the latter being particularly dependent.
There are stories of success and failure for each model. There is no ideal or utopian economic structure that guarantees the success of a city. Instead, planners must be prepared when economic structures falter and lead the way in transitioning to a new structure that can connects assets with opportunities. The key focus should be linkages: how do firms link to one another and where are the opportunities for development?
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