Agglomeration costs limit sustainable innovation in cities in developing economies.

ABSTRACT: Theory and evidence from developed economies suggests that innovation activities benefit from agglomeration economies associated with urban economic density. However, despite the fact that eighteen of the world's top twenty cities are in developing countries, we do not know whether agglomeration affects innovation in the same way in developing countries. We propose that, while there are still agglomeration benefits, the development path followed by cities in developing countries also creates significant agglomeration costs and these act to limit innovation. We build a unique database to measure consistently both urban economic density and innovation across a large number of developing countries. Based on geospatial information, we combine data on nightlights at the city level to proxy urba

SUBMITTER: Estrin S 

PROVIDER: S-EPMC11563381 | biostudies-literature | 2024

REPOSITORIES: biostudies-literature