Rebuilding the city:a focus for European industrial policy?

While the city offers the potential of dynamic agglomeration economies which can spur the achievement of economic growth and act as an engine that powers the economy, it often appears as a centre of crisis in mature ‘developed’ regions and countries, even before the most recent economic downturn. This paper attempts to reconcile these two seemingly paradoxical observations by bringing in a strategic choice perspective to explain how concentrated strategic decision making in the corporate entities that dominate our cities has diminished the very diversity that Jacobs identified as being essential for cities to flourish and develop. The industrial policy implications for cities are subsequently explored in terms of building new industrial districts, developing high skill ecosystems, and fostering multinational webs of cities, all with the aim of ensuring the conditions exist in cities for creativity and development to flourish, notably a diverse and democratic economic system.