The Five Keys to Progress (Part 3): Cities

This the third post in a series of posts about the Five Keys to Progress. I recommend starting with the first post before reading this post. If this is the first post that you have ever read on my blog, I would recommend starting with An Introduction to Progress: Mankind’s Greatest Accomplishment, and then moving on to this series.

In the previous posts in this series, I argued that the concept of the Five Keys of Progress enables us to better under the history of how nations developed and what policies will work in promoting progress today.

The Five Keys to Progress are the fundamental preconditions that much be in place for a society to experience progress. All are necessary, but none are sufficient by themselves. Each key evolved slowly over history as individuals solved local problems and then copied what worked. When all five keys came into existence in one society, progress emerged. As nations copied those keys, progress spread across the globe.

I also argued that to transition from poverty to progress, a society needs to acquire and maintain the five keys to progress:

  1. A highly productive food production and distribution system. This enables societies to overcome geographical constraints to food production so that large numbers of people can focus on solving problems other than getting enough food to eat.

Because agricultural innovation is so geographically constrained and inherently risky to human survival, it took humanity hundreds of thousands of years to acquire this first key. Unfortunately, acquiring this key does trigger progress. A society still needs substantial progress on the other four keys.

Now let’s go onto the second key.

In the “Triumph of the City” (see summary here), Edmund Glaeser calls cities “our species’ greatest invention.” While this might be a little bit of an exaggeration, Glaeser is on to something important. Most people rarely stop to consider the importance of cities to human history.

City dwellers are invariably wealthier than residents in rural areas, often dramatically wealthier. This is because of the cities unique ability to foster innovation and diffusion. Humans as individuals are undoubtedly more intelligent than animals. But the differences in intelligence between humans and chimps or dolphins are not enough to account for how far humans have diverged from other animals in their evolution.

It is only when large numbers of humans are in close geographical proximity that the humanity’s greatest advantage emerges. Density of interaction between humans creates a network of skills and social organizations that is far beyond what any other species has been able to achieve.

Humans in large groups have the ability to cooperate, specialize, learn new skills, copy ideas, test those ideas and constantly improve them based upon feedback from other humans. While humans in small groups tend to use the same technology for generations, humans in large groups can become a network that churns out new ideas and tests them for success in a rapid manner. And when those large groups of people are in constant contact with other large groups of people, the progress is even more rapid.

The large, dense population within cities also naturally promotes specialization, which leads to a broader skills base. A small town might have one restaurant. Because it is the only restaurant in the area, it must serve a cuisine that is acceptable to most of the town.

As the population size of the city increases, the number of restaurants naturally increases as well. But something even more important takes place. When there are a half dozen restaurants in a town, each one of them can cater to the tastes of a different segment of the population. One can serve Chinese cuisine, one can serve pizza and another can specialize in breakfast. Increase the population size to millions and suddenly you can have thousands of restaurants, specializing in increasingly narrow markets. Increased population promotes increased specialization. And each specialization requires a different set of skills.

Previously, we saw that technological innovation is exponential because it is partly based upon the number of technologies already in existence. The larger the number of technologies, the larger the number of potential combinations for new technologies.

But technologies do not combine themselves. Humans have to do that. And while isolated individuals can try a certain number of combinations, a large number of people living in close proximity are far more likely to try all possible combinations that their current technology base allows. And because technologies can only come into being when there are people with the necessary skills to make that happen, those people need to have a wide variety of skills.

Cities matter because they concentrate large numbers of people into a small area. Whereas rural areas of the past had low-density populations with people focused on the skills of growing food, cities had high-density populations with people specializing in a wide variety of occupations, each with their own skills, technologies and social organizations. And these people were in constant daily contact with each other, giving them the ability to copy from a wide variety of people. Cities enabled people to view how other people worked, view their technology and perhaps share ideas. Most of those people whom they shared with would be in their family or occupation, but some might be strangers engaged in other occupations.

Cities have always been havens of freedom. This is important because free people enjoy the benefit of their own skills and innovations, while slaves have no incentive to innovate. If a slave innovates something new, only the master benefits. While most pre-modern societies had some form of forced labor (slavery, serfdom, peonage, etc), trade-based cities make use of free labor in the marketplace. Forced labor could simply not compete with free labor in occupations that require skill, innovation and learning.

But not all cities are created equal. Some cities innovate at a far higher rate than other cities. As more and more trade-based cities evolved, some of them became the locus of emerging technologies. Important cities in history include those in Northern Italy during the Middle Ages (Venice and Florence being the most important), Bruges and Antwerp in modern-day Belgium, Amsterdam from about 1580-1670, London, New York City to today’s Silicon Valley. These cities have played an enormous role in technological and organizational innovation because they had heavy concentrations of people with skills related to emerging technologies of their day. For almost 1000 years, these cities have been the engines of progress.

With the exception of innovation in the field of agricultural technologies and the extraction of minerals, virtually all innovation has come from cities. This is quite extraordinary, given how few people have lived in cities until recently. For a good 100,000 years, cities did not exist. Hunter Gatherers congregated in seasonal camps or fishing villages when and where food sources were highly concentrated, but they had at most a few hundred inhabitants.

Even after cities evolved, a very small proportion of the population actually lived within them. In most Agrarian societies, cities with a population of over 10,000 inhabitants made up less than three percent of the population. And compared to modern standards, a “city” with a population of 10,000 would be considered more of a village today.

Unfortunately, the more people that cram into a city, the less local land that is left over for agriculture. The density of people in a city makes it impossible for everyone to be farmers. To be a successful farmer while living in a city, a person had to be able to walk to their field in the morning and back home every evening. The greater the distance between their residence and their fields, the less time that they could devote to farming each day.

Once cities grew to a point where it was impossible to grow their own food, the inhabitants had to devote themselves full-time to a non-agricultural skill that enabled them to earn an income by selling a product or service on the market. Then they could use that money to buy food on the market. If they could not do so, the city would stop growing.

In my next post in this series, I will cover decentralization of political, economic, religious and ideological power.

If you would like to learn more about this or other related topics, read my book From Poverty to Progress.


Michael Magoon is the author of the “From Poverty to Progress” series of books. The first book in the series is already published with many more to follow.

The writings above are under the same copyright as the main book “From Poverty to Progress”
Copyright © 2021 Michael Magoon

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