One might have thought that striking declines in the costs of shipping goods and communicating knowledge across space would have led to a great dispersal of population. After all, it is at least technically possible to telecommute over great distances. Yet the share of the world living in urbanized areas increased from 40.9 percent in 1985 to more than 50 percent today.
In the developing world, urbanization has often taken the form of exploding populations in megacities. Mumbai’s population increased to 19 million in 2007 from 10.8 million in 1985. Bangalore, the urban symbol of the flat world, has had its population double over two decades, to 6.8 million today from 3.4 million in 1985.
The growth of these cities and the continuing strength of older urban areas — like New York, London and Paris — is no accident. Globalization and new technologies attract people to big cities, by increasing the returns to urban proximity. While it would be technically possible to sit and write software somewhere in the Vale of Kashmir (at least if you didn’t mind the bullets), the innovators in Indian information technology cluster around one another in Bangalore. America’s computer wizards likewise choose to cluster in Silicon Valley rather than disperse.
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