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Cursus: GEO2-3804
Economics of Cities
Cursus informatie
Studiepunten (EC)7,5
By the end of the course, students will be capable of:
  • understanding recent theories and empirical applications of urban economics and urban geography;
  • interpreting the economic evolution of cities as an expression of clustering, agglomeration and (international) network economies;
  • analyzing the different dimensions (‘faces’) of the modern urban economy, both quantitatively (using statistical data and GIS) and qualitatively (interviewing policy makers);
  • analyzing the localization of the economic specializations in cities, including the meaning of particular location factors;
  • investigating policy implications of the economic changes in cities.

Today, cities are in the limelight again as important economic nodes. The modern economy is predominantly an urban, service- and knowledge based economy. In this course students will be taught to recognize and explain the geographical variation in urban economic development.

The course deals with agglomeration and clustering of economic activities from both geographical and urban economics disciplinary perspectives, in relation to cluster and urban economic policy. The course explains the current innovative and knowledge economy of firms and policymaking in relation to urban competitiveness. The geographical discipline focuses on clusters, network formation and industry evolution using institutional theories in which the actor-approach of firms and governments is central. Urban economics traditionally focuses on the role of externalities and urban contexts as attractions for firm and population location decisions and the growth and innovation potentials of firms in a more quantitative sense. Both disciplines heavily lean on empirical research, using complementary research methods like case-study research, surveys, spatial econometrics and general equilibrium modelling. Those methods will be explained in the course in relation to current issues and empirical research on urban development. Much attention will also be given to regional and urban economic policy issues. The students will apply the theoretical and empirical insights from the lectures in an actual case study of urban policy in Utrecht, the Netherlands.

The course takes the interplay between the firm (as an actor) and its agglomerated (urban and regional) environment in relation to (spatial) policy as a starting point. An important stylized fact in this is that firms need other firms to optimize production and innovation processes, and that they thus are related to each other through external relationships in the context of specialization, supply and subcontracting processes, the labour market and/or inter-firm co-operation with a view to the effective development of new knowledge and innovations. By participating actively in this course, students learn to think critically on urban concepts and policy, and apply quantitative and qualitative research techniques in analysing urban economic development.

We look for explanations of urban economic development, creativity and innovation like amenities, infrastructure, and housing. All these facets of post-industrial urban economies are important targets in urban policy. This is expressed in e.g. the promotion of service business centres to an international status. In the race to attract new growth activities, many local authorities already have proclaimed their city as a `number one’ creative city, and policies have been put in place to foster an urban ‘climate’ conducive to the attraction of the creative class. Nevertheless there are significant spatial constraints in cities, forcing policy makers to make choices.

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