Keys to the City: How Economics, Institutions, Social Interaction, and Politics Shape Development

Keys to the City has a twofold focus: urbanization; and cities as growth poles for the future. Fundamentally, it questions why city-regions win or lose and why they develop unevenly. This book challenges established thinking on what it takes to initiate and foster economic development in city-regions. Undeniably, urban development is highly complex with no sure-fire recipe for success. The book tackles this complexity in an innovative way and is a thought-provoking tour de force through the broad field of economic geography, resourcefully linking epistemologies from geographical economics, economic sociology and other related disciplines. The book consists of four main parts, each subdivided into a number of specifically themed chapters. The book’s introductory chapter vividly illustrates current challenges: sorting and resorting of the global economy whose fundamental spatial categories and contexts for interaction are city-regions. Although vague in defining the term ‘development’, Michael Storper builds on a strong economic and growth-oriented definition. ‘[C]hanges in technology and trade costs’ (p. 6) generate particular, spatially uneven dynamics and end up ‘producing’ winning and losing regions, ultimately linked to a society’s welfare. The first and undoubtedly strongest part of the book, ‘The Economic Context of City and Regional Development’, is compelling and dense. It provides key prerequisites to understanding major economic causal relations and complexities, and particularly deals with the question: ‘People or Jobs: Chicken or Egg? ’ (p. 14). The main argument covers the underlying processes of urban specialization and the subsequent changes in urban systems, contesting four key avenues of investigation. Each chapter dissects and critically examines one major thematic contribution: New Neoclassical Urban Economics (Chapter 2), the economic literature on agglomeration and spatial concentration, and particularly New Economic Geography (NEG) (Chapter 3), the role of Marshall–Arrow–Romer (MAR) externalities adding an innovative twist to the localization of the respective M-A-R sources (p. 57) (Chapter 4), and individuals’ preferences and mobility choices (Chapter 5). The explication of the prominent Dixit–Stiglitz–Krugman model exemplifies how insightful Storper is in formulating his criticism of established concepts and how well he is able to bridge the different languages of the disciplines. The essential explanations of the processes of urban specialization and skilled labour concentration in Part I tend to be somewhat selective and thus rather fragmented. Hence, Part II is particularly concerned with ‘The Institutional Context of Cities and Regions’. It explores the ‘idea that specialization could originate from the region’s institutions’ (p. 97; Chapter 6) and investigates ‘the dual nature of informal institutions – groups or communities [Chapter 7], and their bridges to one another [Chapter 8]’ (p. 103) to support or hinder choices for a city’s economic development, as illustrated in the examples of Los Angeles, the Third Italy and Silicon Valley. People group together based on common interests; but those interests, comprising bundles of altering preferences, can shift. Accordingly, group membership is unstable, influencing the costs of negotiation and decision-making within groups. Coalitions – based on bonding and bridging to lock in ‘agglomeration generated specialization’ (p. 138) – are key to development as they provide the necessary context for idea building, policy implementation and conflict resolution. Storper’s economic notion of informal institutions details the resulting formation of interest groups and highlights processes of inclusion and exclusion of group membership and, thus, political ideas. However, his approach mirrors a causal model that neglects the contingency of conditions determined by rules and regulations for economic change processes as recently suggested by BATHELT and GLÜCKLER (2013). They argue from an explicit relational perspective that it is this contingency that defines the premises ‘for the emergence and transformation of socio-economic institutions in spatial perspective’ (BATHELT and GLÜCKLER, 2013, p. 18). Clearly, recent scholarship has questioned the narrow economic lens of institutional conceptualization, specifically highlighting the interaction of institutions and agents to learn and develop new, highly specific knowledge and technology within different geographical spaces (e.g. Regional Studies, 2014