Human activities, such as research, innovation and industry, concentrate disproportionately in large cities. The ten most innovative cities in the United States account for 23% of the national population, but for 48% of its patents and 33% of its gross domestic product. But why has human activity become increasingly concentrated? Here we use data on scientific papers, patents, employment and gross domestic product, for 353 metropolitan areas in the United States, to show that the spatial concentration of productive activities increases with their complexity. Complex economic activities, such as biotechnology, neurobiology and semiconductors, concentrate disproportionately in a few large cities compared to less--complex activities, such as apparel or paper manufacturing. We use multiple proxies to measure the complexity of activities, finding that complexity explains from 40% to 80% of the variance in urban concentration of occupations, industries, scientific fields and technologies. Using historical patent data, we show that the spatial concentration of cutting-edge technologies has increased since 1850, suggesting a reinforcing cycle between the increase in the complexity of activities and urbanization. These findings suggest that the growth of spatial inequality may be connected to the increasing complexity of the economy.
This is a preview of subscription content
Subscribe to Nature+
Get immediate online access to the entire Nature family of 50+ journals
Subscribe to Journal
Get full journal access for 1 year
only $9.92 per issue
All prices are NET prices.
VAT will be added later in the checkout.
Tax calculation will be finalised during checkout.
Get time limited or full article access on ReadCube.
All prices are NET prices.
The data that support the findings of this study are available from the corresponding author upon request.
The code that supports the findings of this study is available from the corresponding author upon request.
Florida, R. The New Urban Crisis: How Our Cities Are Increasing Inequality, Deepening Segregation, and Failing the Middle Class—and What We Can Do About It (Basic Books, 2017).
Diamond, R. The determinants and welfare implications of US workers’ diverging location choices by skill: 1980–2000. Am. Econ. Rev. 106, 479–524 (2016).
Berry, C. R. & Glaeser, E. L. The divergence of human capital levels across cities. Pap. Reg. Sci. 84, 407–444 (2005).
Hidalgo, C. A. & Hausmann, R. The building blocks of economic complexity. Proc. Natl Acad. Sci. USA 106, 10570–10575 (2009).
Balland, P.-A. & Rigby, D. The geography of complex knowledge. Econ. Geogr. 93, 1–23 (2017).
Hidalgo, C. Why Information Grows: The Evolution of Order, from Atoms to Economies (Basic Books, 2015).
Hausmann, R. et al. The Atlas of Economic Complexity: Mapping Paths to Prosperity (MIT Press, 2014).
Bettencourt, L. M. A., Lobo, J., Helbing, D., Kühnert, C. & West, G. B. Growth, innovation, scaling, and the pace of life in cities. Proc. Natl Acad. Sci. USA 104, 7301–7306 (2007).
Bettencourt, L. & West, G. A unified theory of urban living. Nature 467, 912–913 (2010).
Bettencourt, L. M. A. The origins of scaling in cities. Science 340, 1438–1441 (2013).
Youn, H. et al. Scaling and universality in urban economic diversification. J. R. Soc. Interface 13, 20150937 (2016).
Warsh, D. Knowledge and the Wealth of Nations: A Story of Economic Discovery (W. W. Norton & Co., 2007).
Jones, B. F. The burden of knowledge and the “Death of the Renaissance Man”: is innovation getting harder? Rev. Econ. Stud. 76, 283–317 (2009).
Scott, A. J. & Storper, M. The nature of cities: the scope and limits of urban theory. Int. J. Urban Reg. Res. 39, 1–15 (2015).
Gans, J. S. & Stern, S. The product market and the market for “ideas”: commercialization strategies for technology entrepreneurs. Res. Policy 32, 333–350 (2003).
Feldman, M. P. & Audretsch, D. B. Innovation in cities: science-based diversity, specialization and localized competition. Eur. Econ. Rev. 43, 409–429 (1999).
Glaeser, E. L., Kallal, H. D., Scheinkman, J. A. & Shleifer, A. Growth in cities. J. Political Econ. 100, 1126–1152 (1992).
Hidalgo, C. A. et al. in Unifying Themes in Complex Systems IX (eds Morales, A. J. et al.) 451–457 (Springer, 2018).
Hidalgo, C. A., Klinger, B., Barabási, A.-L. & Hausmann, R. The product space conditions the development of nations. Science 317, 482–487 (2007).
Zheng, S., Sun, W., Wu, J. & Kahn, M. E. The birth of edge cities in China: measuring the effects of industrial parks policy. J. Urban Econ. 100, 80–103 (2017).
Neffke, F. & Henning, M. Skill relatedness and firm diversification. Strateg. Manag. J. 34, 297–316 (2013).
Jara-Figueroa, C., Jun, B., Glaeser, E. L. & Hidalgo, C. A. The role of industry-specific, occupation-specific, and location-specific knowledge in the growth and survival of new firms. Proc. Natl Acad. Sci. USA 115, 12646–12653 (2018).
Park, J. et al. Global labor flow network reveals the hierarchical organization and dynamics of geo-industrial clusters. Nat. Commun. 10, 3449 (2019).
Klepper, S. Employee startups in high‐tech industries. Ind. Corp. Change 10, 639–674 (2001).
Breschi, S. & Lissoni, F. in Handbook of Quantitative Science and Technology Research: The Use of Publication and Patent Statistics in Studies of S&T Systems (eds Moed, H. F. et al.) 613–643 (Springer, 2005).
Feldman, M. P. & Florida, R. The geographic sources of innovation: technological infrastructure and product innovation in the united states. Ann. Assoc. Am. Geogr. 84, 210–229 (1994).
Romer, P. M. Endogenous technological change. J. Political Econ. 98, S71–S102 (1990).
Moretti, E. The New Geography of Jobs (Houghton Mifflin Harcourt, 2012).
Fleming, L. & Sorenson, O. Technology as a complex adaptive system: evidence from patent data. Res. Policy 30, 1019–1039 (2001).
Mukherjee, S., Romero, D. M., Jones, B. & Uzzi, B. The nearly universal link between the age of past knowledge and tomorrow’s breakthroughs in science and technology: the hotspot. Sci. Adv. 3, e1601315 (2017).
Wuchty, S., Jones, B. F. & Uzzi, B. The increasing dominance of teams in production of knowledge. Science 316, 1036–1039 (2007).
Wu, L., Wang, D. & Evans, J. A. Large teams develop and small teams disrupt science and technology. Nature 566, 378–382 (2019).
Polanyi, M. The Tacit Dimension (Univ. Chicago Press, 2009).
Collins, H. Tacit and Explicit Knowledge (Univ. Chicago Press, 2010).
Friedman, T. L. The World Is Flat 3.0: A Brief History of the Twenty-First Century (Picador, 2007).
Florida, R. The world is spiky. Atl. Mon. 296, 48–51 (2005).
He, C. & Zhu, S. Evolutionary Economic Geography in China (Springer, 2019).
Zhu, S., He, C. & Zhou, Y. How to jump further and catch up? Path-breaking in an uneven industry space. J. Econ. Geogr. 17, 521–545 (2017).
Alshamsi, A., Pinheiro, F. L. & Hidalgo, C. A. Optimal diversification strategies in the networks of related products and of related research areas. Nat. Commun. 9, 1328 (2018).
Lee, K. & Lim, C. Technological regimes, catching-up and leapfrogging: findings from the Korean industries. Res. Policy 30, 459–483 (2001).
Lee, K. & Malerba, F. Catch-up cycles and changes in industrial leadership: windows of opportunity and responses of firms and countries in the evolution of sectoral systems. Res. Policy 46, 338–351 (2017).
Petralia, S., Balland, P.-A. & Rigby, D. L. Unveiling the geography of historical patents in the United States from 1836 to 1975. Sci. Data 3, 160074 (2016).
Hall, B. H., Jaffe, A. B. & Trajtenberg, M. The NBER Patent Citation Data File: Lessons, Insights and Methodological Tools (National Bureau of Economic Research, 2001).
Nomaler, Ö., Frenken, K. & Heimeriks, G. On scaling of scientific knowledge production in U.S. metropolitan areas. PLoS One 9, e110805 (2014).
Patience, G. S., Patience, C. A., Blais, B. & Bertrand, F. Citation analysis of scientific categories. Heliyon 3, e00300 (2017).
We thank Ö. Nomaler, K. Frenken and G. Heimeriks for providing the data on scientific publications used in the main text, and G. Patience, C. Patience, B. Blais and F. Bertrand for providing the data on the age of references listed in scientific publications. We also thank R. Boschma, K. Frenken, M. Storper, A. J. Scott, T. Broekel, B. Jun, F. Pinheiro, A. Alshamsi and F. Neffke for useful comments and suggestions. Financial support from the Regional Studies Association through the Early Career Grant awarded to P.-A.B. is gratefully acknowledged. C.A.H. acknowledges support from the MIT Media Lab consortia, from the MIT-Skoltech seed grant and from the MIT-Masdar initiative. The funders had no role in study design, data collection and analysis, decision to publish or preparation of the manuscript.
The authors declare no competing interests.
Peer review information Primary Handling Editors: Mary Elizabeth Sutherland; Stavroula Kousta.
Publisher’s note Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
About this article
Cite this article
Balland, PA., Jara-Figueroa, C., Petralia, S.G. et al. Complex economic activities concentrate in large cities. Nat Hum Behav 4, 248–254 (2020). https://doi.org/10.1038/s41562-019-0803-3
Scientific Reports (2022)
Economia Politica (2022)
Does the Construction of Transportation Infrastructure Enhance Regional Innovation Capabilities: Evidence from China
Journal of the Knowledge Economy (2022)
Scientific Reports (2021)