Anil Varanasi


“One of the biggest meta-ideas of modern life is to let people live together in dense urban agglomerations. A second is to allow market forces to guide most of the detailed decisions these people make about who they interact with each other. Together, the city and the market let large groups of people cooperate by discovering new ideas, sharing them, and learning from each other. The benefits can show up as a new design for a coffee cup or wages for a worker that grow with experience acquired in jobs with a sequence of employers.” — Romer

The benefits of agglomeration have been high with labor pools, better wages, and knowledge spillovers. Throughout history there have been productive clusters, across multiple disciplines. People across different fields knew and credited each other. It couldn’t be that it was an accident that these clusters were so dense with ideas and people, that lasted generations. A few examples in just modern history:

It seems like we are missing a huge opportunity not working nearly hard enough to build new clusters.

In general, intra-firm agglomeration seems understudied, please email if you have suggestions or comments on that or any of the above.