A summary of Jane Jacobs’ economy of cities and a briefly applying some of the book’s ideas to European prehistory.
Jane Jacobs is perhaps best known for her book “The Death and Life of Great American Cities” in the early 1960s. She is less well known for her 1969 book “The Economy of Cities”. However this book, brought to my attention by a comment in Matt Ridley’s “The Rational Optimist” last summer, is a fascinating argument for why cities grow and contract.
My original reason for taking an interest in her book was Jacobs’ explanation for the origin of agriculture. This idea has some common ground with mine (see Trade and Farming), but was written down forty years ago. However, the book has much more to offer than that one measly idea. The aim of this post is to summarise the books’ arguments as I understand them and to discuss some of their implications for prehistory.
The argument in ‘The Economy of Cities’
Jacobs’ arguments, as far as I can tell, can be summarised by the following points:
1) The creation of all new goods, whether technological breakthroughs or fashions, originates in cities, not in the countryside. This is due to large numbers of people in cities and their demand for novelties and cheaper products.
2) The growth of a city comes about due to continuously creating new types of work in that city. Simply continuing to mass-produce the same small range of goods leads only to stagnation or even contraction when demand for those goods disappears.
3) New types of work in a city result from people experimenting with and (sometimes by chance) finding new opportunities to sell stuff. These opportunities are often nothing to do with what the people did before. This process is very inefficient and has a high chance of failure. Large corporations and company towns, which are generally highly efficient with extreme division of labour, are very bad at creating new and different sorts of things to sell.
4) The new types of work result from individuals supplying the needs of the city itself – whether clothing, food, inventions or waste-disposal. The industries only inadvertently create items or inventions for export. However, it is the export of these items that creates the wealth. Trying to plan what a city exports doesn’t work.
5) Cities can prosper almost anywhere, as long as the conditions for growth (i.e. small, inefficient businesses generating new work) are met. They do not have to be in any special place.$
Jacobs’ believed that if cities were allowed to be inefficient and with many competing businesses (i.e. without being dominated by any one industry) they would generate more and more work, with small businesses budding off small businesses. Hence these cities would continue growing.
The origin of agriculture – cities first
Jacobs argued that perhaps the first great example of the process of creating new work was the invention of agriculture and animal husbandry. ‘Cities’ developed this industry due to the need to feed people in the ‘city’*. Eventually this technology was exported to other places, including the countryside.
Jacobs’ reasons for saying this was that she saw the countryside itself as a passive receiver of ideas. Lack of population pressure means that new industries don’t need to be developed in the countryside. Therefore the countryside gets its technology and industry, and much of its work, from cities. As a result of this, Jacobs argued that when local cities disappear the technology of the countryside, unsupported, can disappear with it.
The reason why people are reluctant to consider such a radical idea, Jacobs argued, is due to the influence of the Bible on people’s thinking. So if Genesis said that farming came first and cities later then that’s how people viewed the past. She particularly singled out Adam Smith in this respect, saying that his ideas, which were influenced by the Bible, have heavily influenced people’s view of economics ever since.
Discussion: Bronze age redistributive economies
Most academics argue for what’s known as a ‘redistributive economy’ or ‘palace economy’ in the Bronze age cities of Mesopotamia, Anatolia and Crete. This means people working for a master, the king, to produce food and craft goods which they then hand to the king and his bureaucrats. In return the king ‘pays’ the people, usually in food. It is the king who controls imports and exports to and from the city. The making of luxury goods is conducted by palace-employed craftsmen and women.
However using Jacobs’ model this would effectively make the early cities of Mesopotamia like company towns. Their efficiency would cause them to stagnate, not grow. Yet all the archaeological evidence shows that these cities grew substantially. Jacobs’ would read this as evidence for small-scale private enterprises creating new work, not highly controlled redistribution.
Inventing the wheel
Academics often ask the question “where was X invented?”, this applies to agriculture, the wheel, metallurgy, horse-riding and many other things. Jane Jacobs would have given an unequivocal answer to that – in cities.
*Obviously in the case of inventing agriculture you’re back in the late Palaeolithic, when there’s no such thing as a city, so if you take her literally she must be wrong. However, there are settlements such as those of the Natufian Levant, which were probably the largest in the world at the time. Jacob’s argued that these were the equivalents of cities at the time. Personally, I think that’s reasonable.
In the case of the wheel and horse-riding there have been repeated claims, based in part on archaeological evidence, that these arose in the Asian Steppe. If Jacobs’ arguments are right then it’s far more likely that such things arose in the equivalents of cities, such as existed in Mesopotamia, Anatolia, ‘Old Europe’ and a few other sites . This may be important when weighing up arguments about the Indo-European language problem.
Equally, the origins of copper smelting metallurgy have been hotly disputed, with some arguing for multiple origins, some (including, cautiously, me) a single origin in the Balkans, and others arguing for an origin in either Anatolia or Iran. If Jacobs’ logic is applied, then looking for a large settlement at the time of the origin of copper smelting (around 5500-5000BC) should help. For example, Çatalhöyük in Anatolia (7500BC to 5500BC) could just about fit the bill. However, that would have been a reason for it’s economic growth, not it’s collapse at this time.
Ancient economic stagnation
Finally, could there be evidence of economic stagnation in prehistory?
The rise and fall of the Balkan copper age economies of ‘Old Europe’ could be an example. If, say, they were based on the export of just copper and gold, then the subsequent rise of other centres producing their own copper and gold may well have caused the Balkan economies to wither around the early fourth millennium.
Similar arguments could perhaps be applied to many backward steps in the Neolithic economies of Europe and elsewhere. For example the demise of the LBK cultures of northern Europe in the fifth millennium or the retreat of agriculture in Britain after a surge in the fourth millennium.
Equally, some form of economic stagnation might have led to the collapse of various early states at the end of the Bronze age. For example, Linear B archives from late Minoan period Crete seem to show excessive centralisation of power at this time and this may have led to stagnation and collapse of the Minoan economy.
As far as I can tell, even though Jacobs’ “Economy of Cities” is becoming better known amongst economists, it’s still not on many university reading lists. Personally, I think that if it were put on the reading lists of archaeology students at university that might be a good thing.
Jacobs, J. 1970 The Economy of Cities, Jonathan Cape, p288.
Ridley, M. 2010 The Rational Optimist: How Prosperity Evolves, Fourth Estate, pp488.
Smith, A. 1776 The Wealth of Nations
This replaces an earlier post which I junked.
*City is used in the loosest sense here.
$ If you read the ‘trade and farming‘ page you’ll see that I don’t really agree with this point, at least for the ancient world.