Flat earth thinking

July 12, 2009

nyc skyline

It’s intuitive that the architecture and layout of a city make a difference to our everyday lives: how easy it is to get about, and whether it feels like a nice place to live. In 1961 Jane Jacobs laid out the template for mixed-use neighbourhoods. We now know that well-designed buildings and public spaces contribute to wellbeing and social capital.

But what are the economic impacts of ‘quality of place’? Last week CABE and the RDAs organised a seminar to try and find out. The morning session had excellent presentations from my colleague Ben Rogers at CLG, Jim Bennett at the Homes and Communities Agency and Paul Hildreth from SURF. More on these in a moment.

Does ‘quality of place’ have anything to do with urban economic performance? Many superstar cities are bad places to live – like Hong Kong, LA or much of Silicon Valley. Equally, when cities like Liverpool and Manchester lost up to half their manufacturing jobs in the 1970s and 1980s, it’s unlikely that poor design values were to blame.

But these cities’ recovery in the 1990s was clearly helped by the remodelling of their city centres. This has attracted investors and new residents – although it’s been no substitute for good fundamentals. The ‘place offer’ is part of the story here – but how much?

The evidence tells us that human capital, innovation by firms, urban critical mass and economic diversity have the single biggest impacts on cities’ economic performance. And they are linked: cities make innovation easier, and have bigger, more diverse labour markets. The physical environment helps all this along (and lack of decent housing raises the local cost of living). But the evidence does not suggest it’s an active driver of growth.

‘Quality of place’-based regeneration also has winners and losers. Investing in design can help raise local house prices. This is good news for land and property owners – but not if you’re renting and get priced out, or if your home is demolished and replaced by somewhere more expensive. These are real risks in some Housing Market Renewal areas. Pathfinders are needing to deal with the problem by offering guaranteed homes, or cheap finance to buy a new one.

Fundamentally, I think the jury is still out on quality of place. Its importance often comes down to definition. CLG define quality of place as ‘built environment environment factors affecting life chances’. This involves only a small set of policy levers – design, planning, construction, space management.

By contrast, Paul defined quality of place as ‘what makes places work’ – ideas flow, infrastructure, big markets, skills, business-to-business links and so on. At a stretch, we could label this ‘quality of place’. But we now have an official definition that is much tighter.

Paul also highlights a bigger challenge, which is to get Government as a whole to improve its spatial awareness. Thomas Friedman was wrong: the world is spiky, not flat. Now that the Nobel Prize in Economics has gone to Paul Krugman, for his work explaining why place matters, it’s increasingly hard to pretend that it doesn’t.

But many Whitehall departments still take a flat earth view. There is little understanding of what makes different places work. Too many services are still delivered in silos, with little joining up. There is good evidence that investing in city-regions could help achieve national goals.  And more urgently, it is already clear that the recession is having very different effects in different areas. That underlines the need to junk flat-earth perspectives.

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