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There's No Substitute for Cities

Penn IUR

In the COVID-19 crisis, dense and globally-connected cities have been disproportionately damaged. What does this mean for the future of the city? Looking beyond the crisis, has our crash course in “distance everything,”—e.g. telemedicine, remote work, and virtual entertainment—enabled a new way of life outside of cities based on the rapid acceptance of this new technology?  High property costs, inadequate infrastructure, and congestion have already resulted in our densest, largest cities losing out to secondary and tertiary cities—will COVID-19 accelerate this trend or will cities see a redux of the vicious cycle of population loss amid a return of suburbanization as they did in the 1970s and 1980s?

Cities will now be competing in a new dimension as technology-enabled remote work has matured dramatically—but this maturation may not be as negative for cities as some expect. Cities will always be best-equipped to deliver the intensity and diversity of interactions that fuel human enjoyment and advancement. Developing communications technologies may allow cities to be more productive, given their current infrastructure, which has been a choke point for cites.  Dense cities can expand their economic reach because they can maintain their innovation-driving density while using communications technology to alleviate their infrastructure and environmental constraints.  COVID-19 has, however, illuminated the necessity for robust public health infrastructure. This will be another dimension on which cities will compete: to deliver “density with confidence.” Dispersion will occur: urban areas must grow as population grows, but it will take a different form—urban dispersion rather than dispersion from urban areas. Secondary and tertiary cities have grown faster than gateway cities in recent years, and the COVID-19 crisis may to accelerate that trend, but not likely at the expense of major cities. Employers, now cognizant of the feasibility of deploying spatially-dispersed cross-functional teams, will be increasingly incentivized to concentrate high-value activities in dense cities that now have more productive capacity because technology will have alleviated important infrastructure and environmental constraints.  This remains the era of cities: we believe there is no substitute for the power of cities to bring people together, spurring creativity, collaboration and innovation.

Richard Voith is President and Principal of Econsult Solutions, Inc.

Susan Wachter is Co-Director, Penn Institute for Urban Research, and Sussman Professor and Professor of Real Estate and Finance, The Wharton School.