Wages are higher, and unemployment lower, for workers living in an "innovation cluster" than for comparably educated workers outside of these privileged places. The majority of the iPhones value comes from the original idea, its unique engineering, and its beautiful industrial design. Google , . He's clear and concise. Moretti provides a sweeping summary of the new stylized facts of metropolitan growth. . As the global economy shifted from manufacturing to innovation, geography was supposed to matter less. Theres a sea change going on, a redistribution of population and wealth fueled by innovative companies that need to be in ecosystems to thrive. NPR Here and Now, Politicians from both parties, acutely aware that voters are giving a critical eye to the unemployment rate, continue to tout a rebirth in American manufacturing as the key to job growth. Moretti, an economist at the University of California Berkeley, offers a comprehensive and non-technical discussion of the shift to a knowledge-based economy, the growing importance of human capital to individual and community economic success, and the critical role played by industry clustering in driving innovation and productivity. Innovative centers large (Silicon Valley, Boston and Washington) and small (Austin, Raleigh and Salt Lake City) are pulling away in terms of productivity and incomes, and bringing those lucky enough to call such places home along with them. And Enrico is right that we should pay attention to the geography of where smart people are choosing to work, play, and live their lives. The problem, according to Moretti, is that we often look at places like Palo Alto, Calif., with its office parks, Stanford University campus and ambitious entrepreneurs, and fail to recognize the ripples that tech companies send through the greater economy. In fact, nothing could have been further from the truth. RT @ProducerCities: Rereading chapter 1 (American Rust) of The New Geography of Jobs. Introduction1 1. Author Enrico Moretti, an Italian-born . However, not everyone agrees that more manufacturing equals more jobs. Moretti traces the growing importance of these elite cities to the increasing clout of innovative sectors, in which ideas account for most of the value-added. Smart Labor: Microchips, Movies, and Multipliers45 3. But the pundits were wrong. A second reason that the rise of innovation matters to all of us has to do with the almost magical economics of job creation. Moretti gets special points for observing that Friedmans The World Is Flat thesis is simply wrong. It is dense with ideas, but spiced liberally with local detail: like the story of the San Francisco book-binder whose business rises and falls with the NASDAQ or how Microsofts idiosyncratic relocation decisions changed the future of a down-on-its-luck Seattle. Consumers benefit, of course. And there are information spillovers: the cross-fertilization of ideas and know-how between firms. In just three decades it has gone from being a small fishing village to being a huge metropolis with more than 10 million residents. 2023 OCLC Domestic and international trademarks and/or service marks of OCLC, Inc. and its affiliates. The United States is not in particularly high spirits these days. The New Human Capital Century215 Acknowledgments251 Notes253 References269 Index279, "Enrico Moretti's superb book highlights why the study of economic geography is vital for understanding fundamental issues such as the root causes of rising income inequality, innovation, and job growth. "David Brooks,The New York Times, "The New Geography of Jobs, examines how and why hiring is stronger in some U.S. cities than in others. "Reuters, "Morettis book suggests that for each additional job in the average high-tech firm, five additional jobs are created outside that firm in the local community. For the past thirty years, the three Americas have been growing apart at an accelerating rate. %PDF-1.2 % Visalia was predominantly a farming community with a large population of laborers but also a sizable number of professional, middle-class families. American rust -- Smart labor: microchips, movies, and multipliers -- The great divergence -- Forces of attraction -- The inequality of mobility and cost of living -- Poverty traps and sexy cities -- The new "human capital century." Access-restricted-item We are used to thinking of the United States in dichotomous terms: red versus blue, black versus white, haves versus have-nots. The author's research shows that you do not have to be a scientist or an engineer to thrive in one of these brain hubs. This part, where the key factor is labor costs, takes place on the outskirts of Shenzhen. It wasn't supposed to be this way. As Moretti notes, cities with large skilled population shares pay high wages to low-skill workers. For someone like David Breedlove, a highly educated professional with solid career options, choosing Visalia over Menlo Park was a perfectly reasonable decision in 1969. The term "Rust Belt" refers to an economic region in the northeast United States, roughly covering the states of Michigan, Wisconsin, Indiana, Illinois, Ohio, and Pennsylvania, a region known as the manufacturing heartland of the nation.Many of the factories and steel mills that produced the "American economic miracle" during and after World War II (1939 - 1945) were padlocking . While Menlo Park was close to the Pacific Ocean beaches, Visalia was near the Sierra Nevada range and Sequoia and Kings Canyon National Parks. This means that for the first time in recent American history, the average worker has not experienced an improvement in standard of living compared to the previous generation. Were sorry, but WorldCat does not work without JavaScript enabled. The presence of many college-educated residents changes the local economy in profound ways, affecting both the kinds of jobs available and the productivity of every worker who lives there, including the less skilled. Smart people tend to cluster into globally competitive brain hubs that, in Morettis eyes, will form the basis for much of Americas future prosperity.Free Enterprise, I highly recommend to everyone in business or wanting to be in business.Kathleen Quinn Votaw. Bloomberg Businessweek, "Moretti has written the most important book of the year, I can't recommend it enough. As Detroit and Cleveland have declined, Shenzhen has grown. But today there are "three" Americas. In this book, the focus is almost entirely on the forces that drive long-run trends. These trends are reshaping the very fabric of our society. Innovative cities provide a fertile ecosystem for start-up businesses, he notes, consisting of suppliers, advisers and venture capital: forward and backward linkages spruced up for the Internet era. 0000001580 00000 n A great summary of Moretti's and other economists' research on why highly skilled workers tend to be attracted to cities, and why some cities become "innovation hubs" that make everyone who works UC Berkeley professor of economics Enrico Moretti, in "The New Geography of Jobs," creates a wonderful complement to Richard Florida's books (e.g., "The Rise of the Creative Class" and "Whos Your 5 The Inequality of Mobility and Cost of Living. In those places, nearly 50 percent of the residents have college degrees. In his book The New Geography of Jobs, University of California at Berkeley economics professor Enrico Moretti argues that, contrary to conventional wisdom, the information economy is a driver of job growth. Greater Cleveland ranks 8th nationally in the percentage of 25- to 34-year-olds in the labor force with a graduate or professional degree, ahead of such "brain hubs" as Chicago, Seattle . Shenzhens population has grown by more than 300 times in the same period. "EconLog, "Moretti has done a good deed by sitting down to write. In this book, the author provides a fresh perspective on the tectonic shifts that are reshaping America's labor market, from globalization and income inequality to immigration and technological progress, and how these shifts are affecting our communities. Search the history of over 806 billion Houghton Mi ffl in Harcourt Page 21 02/21/2012 Moretti Th e New Geography of Jobs prelim fi rst pages S R AMERICAN RUST 21 The engine that made all of this possible was an unprece-dented rise in the productivity of workers. 9780547750118 (hbk.) Although jobs in local services constitute the vast majority of jobs, they are the effect, not the cause, of economic growth. Its residential neighborhoods have the typical feel of many Southern California communities, with wide streets lined with one-story houses, lawns with shrubs and palm trees, and the occasional backyard pool. Politics & Government - 21st Century - General & Miscellaneous, iPhone For Dummies: Updated for iPhone 12 models and iOS 14, Affirmative Action Around the World: An Empirical Study, Economic Facts and Fallacies: Second Edition, HBR's 10 Must Reads on Making Smart Decisions (with featured article "Before You Make That Big Decision" by Daniel Kahneman, Dan Lovallo, and Olivier Sibony), The Worldly Philosophers: The Lives, Times And Ideas Of The Great Economic Thinkers, Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism, Currency Wars: The Making of the Next Global Crisis. From blind faith in ever-rising housing prices to plummeting, Enrico Moretti is a professor of economics at the University of California, Berkeley, whose research has been supported by the National Science Foundation, the National Institutes of Health and has been featured in the, In 1971, President Nixon imposed national price controls and took the United States off the gold standard, an extreme measure intended to end an ongoing currency war that had destroyed faith in the, Choose Expedited Shipping at checkout for delivery by, Learn how to enable JavaScript on your browser, U.S. The Chinese call it the city with one high-rise a day and one boulevard every three days. As you walk along its wide streets, you feel the citys energy and optimism. For the past thirty years, the three Americas have been growing apart at an accelerating rate. It is this new map that University of California, Berkeley economist Enrico Moretti describes in detail in his book The New Geography of Jobs. While the divide is first and foremost economic, it is now beginning to affect cultural identity, health, family stability, and even politics. Poverty Traps and Sexy Cities178 7. Rather, the important elements are creativity and ingenuity. Includes bibliographical references (p. [253]-277) and index. Enrico. For the past thirty years, Silicon Valley has been a magnet for good jobs and skilled workers from all over the world. In this important and persuasive book, U.C. As the Berkeley economist Enrico Moretti wrote in his 2012 book The New Geography of Jobs, high-tech job centers like Silicon Valley are attracting more and more educated and talented people, and . 0547750110 (hbk.) Menlo Park had a largely middle-class population but also a significant number of working-class and low-income households. As old manufacturing capitals disappear, new innovation hubs are rising and are poised to become the new engines of prosperity. Most sectors have a multiplier effect, but the innovation sector has the largest multiplier of all: about three times larger than that of manufacturing. If you buy an iPhone online, it is shipped directly to you from Shenzhen. Globalization provides the means to cheaply churn out millions of the devices, and a market for the products just as large. Menlo Park had many low-income families in 1969, but today most of its new residents have a college degree or a masters degree and a middle- to upper-class income. A handful of cities with the right industries and a solid base of human capital keep attracting good employers and offering high wages, while those at the other extreme, cities with the wrong industries and a limited human capital base, are stuck with dead-end jobs and low average wages. Their workers are among the most productive, creative, and best paid on the planet. But today there are three Americas. No community reviews have been submitted for this work.