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By Matthew P. Drennan

How can metropolitan areas stay filthy rich and aggressive in a quickly altering financial system? demanding a few long-standing assumptions, Matthew Drennan argues that these areas that experience invested seriously within the info financial system have performed far better than those who proceed to depend on production and as their base. additionally, he contends, the advantages of that development succeed in the city operating bad, past stories on the contrary although. the knowledge economic climate and American towns offers a wealth of conscientiously analyzed econometric info so that it will be of significant price to economists, planners, and policymakers all in favour of the way forward for America's metropolitan components. extra assisting facts should be made to be had on-line. not only one other glib cheer for the data financial system, this publication offers the type of difficult facts had to recommend successfully for switch.

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The interesting fact that some places are surging ahead while many are lagging behind over such a long period begs the question What does it all mean for the distribution of household income in metropolitan areas, for low-income households, for minority households, in places doing well compared with those not doing well? There are two obvious questions that should be addressed. First, do metropolitan economies specialized in the information sector have higher or lower rates of city poverty than places specialized in goods production and distribution and than places with no specialization?

2 | Emergence of the Information Sector In 1993, a man-made flood in Chicago knocked out the power to office towers in the Chicago Loop, shutting them down for a few days. The belowstreet-level flood reached them all because the buildings are linked by a system of tunnels, built in the early part of the twentieth century. The original purpose of the tunnels was to facilitate the delivery of large volumes of coal to the skyscrapers, essential for heating the huge spaces. A New York Times photo of the tunnels after the water was removed revealed their modern use: There was not a trace of coal anywhere.

Given that the rural good production is located in the rural area and the urban good production is not, then, over time, employment and population will shift out of the rural area and into the urban area. All developed nations have had a long-term shift of population from rural areas into urban areas, and the Simon model explains the observed shift. Simon did not test his model, but Barclay Jones tested it for the United States (1984). Jones recast the Simon model within the evolutionary view of long-term economic development by moving from Simon’s two sectors, rural and urban, to four sectors.

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