Social scientists had long studied the growth of cities, but in the 1990s they started to notice something puzzling: Cities like Seattle and Austin were booming as new-economy hubs for no apparent reason other than the fact that the people responsible for the greatest innovations in high technology had chosen to live in places that were bike-friendly, had good music scenes, and allowed them to show up to business lunches in jeans.
Elsewhere, downtown enclaves in cities like Philadelphia and Providence had also begun to rebound, with new condominiums and coffee bars, even as the fundamentals of the local economies around them seemed to change little. What puzzled the experts was why, if the “American central city generally did not ‘come back’ in the 1990s,” as Carlino and Saiz wrote in their paper, “the ‘beautiful city’ within flourished.”
In their paper, Carlino and Saiz found a statistical correlation between the number of leisure visits to a metropolitan area and the growth of factors like population and housing values. They controlled to determine that the tourism itself wasn’t causing the growth, and argue in their paper that people move to the cities for the same reason they visit as tourists. They also demonstrate that investment by local governments in such “recreational capital” – spending on parks, cultural institutions, sports facilities, and other public-private spaces – has succeeded in making cities like Charlotte and San Antonio more attractive to tourists. They compute that a 10 percent boost in such spending yields a 2.3 percent increase in leisure visits, and, if the correlation holds, will also increase growth.
“If you have things that attract high-skilled, high-income individuals, they are more productive,” said Carlino, an economist at the Federal Reserve Bank of Philadelphia. “They are the ones who are likely to start up new companies.”
Of course there are exceptions and outliers to every trend, and this isn’t to suggest that local growth stems only from being a nice place to visit. Regardless of how, if you want to be more than a one-trick town, you need to attract the decision-makers and innovators of society.
My urban geography professor last semester told us that when the headquarters for the Ministry of Transportation was partly moved to St Catharines in the nineties, many of the employees did not follow. They continued to live in places like Burlington and chose to commute to work in St Catharines. This underlines the importance of initiatives like the new Niagara Centre for the Arts in downtown St Catharines. It’s not enough to be a sprawl of transmission factories, government bureaucracies, and power centres; we need to be an attractive place to live as well.