Re: Econ of Etalk and Cities

Robin Hanson (
Fri, 6 Sep 96 10:10:52 PDT

Eugene Leitl writes:
>> Will improvements in information technology eliminate face-
>> to-face interactions and make cities obsolete?
>Highly unlikely, since cities are not built merely to facilitate
>meetings. High-quality infrastructure is expensive -- the more the
>structure deviates from a sphere, the larger is the average path length.
>Suburbia is an infraststructure cost (installation/repair) nightmare.
>> interactions. Cities are modeled as a means of reducing the
>> fixed travel costs involved in face-to-face interactions.
>Signals, solids, gases and fluids and electricity have to travel as well.
>Shared infrastructure allows use of larger grains, which has a positive
>impact on price/performance ratio.

Ask youself: then why it is so much more expensive for people to live
in urban areas? The costs of getting gases, solids, fluids, etc. in
rural areas may be a bit higher than in urban areas, but not by much
(does WalMart charge more there?). In contrast, the cost to get raw
space is very large. Why? Because so many people want to be there
for their jobs. Why are the jobs there? Sure some people need to be
physcially present to run those pipes and delivery trucks, but not
very many. It seems it's mainly because companies show a strong
preference for colocating their employees, and locating them near
suppliers and customers, even when the physical cost to ship stuff is
small. Why? It seems because people want to meet each in person a lot.

I suggest you read a bit more urban economics before you so quickly
dismiss this analysis by economics who I'm sure have read quite
a bit of urban economics.

Robin Hanson