Tuesday, June 24, 2014

Networks and densities

In 2012, The Freeman featured discussions of Seasteading. "What would it take to get you to move to a seastead?" I liked this response by Arthur Breitman:
A very large community with millions of people and a thriving economy. I am a radical libertarian, and yet, right now my best option is to live in New York City, one of the most highly taxed and regulated places in the U.S. The sheer value of the social networks in NYC makes up for the taxation. I would be much freer in a place like New Hampshire, and yet it is too provincial for me.
In California, we explain political dysfunctionality as a "sun tax" (not a tax on solar panels). In NYC it would be a "networking" tax. In an exit-voice-loyalty context, some places elicit plausible loyalties. Where there is any sort of immovable amenity, it will be exploited in this way by the local pols. Talk about "exploitation."

In a previous post, I cited Edmund Phelps' discussion of cities and the economic benefits of density.  In his JEL review of Phelps, Joel Mokyr also cites the density discussion: "By that logic. the densely populated and heavily urbanized Netherlands should have outperformed Scotland and France and should have dominated England (leaving aside the problems with reverse causation)." p. 193. They are seemingly talking about the population densities of whole countries. I have often criticized the use of metropolitan area-wide average densities as a poor proxy for networking opportunities; national population densities are a far worse proxy.

Networking is important and, yes, most people find advantageous ways to network in all sorts of cities. They have not yet chosen to network from isolated mountain tops. Even where they can get a satellite connection, they want to manage the many networks in their lives -- including the ones they access on foot, by car and via the nearest airport.