Saturday, 30 May 2020

The democratising effect of video in an agglomeration economy

The agglomeration economic model has critics. It can be seen as pulling talent and subsequently wealth to a small number of locations leaving behind it towns and cities which are a shadow of what they once were during the large scale industrial era. However, in cold hard economic terms agglomeration does deliver. Economic hubs such as Cambridge are generating wealth for the exchequer which is then spent across the UK. It also must be considered that in a globalised world, agglomeration hubs are competing with other such centres across the world. If there was not bio-science agglomeration in Cambridge, it would not make a British post-industrial town wealthier, and if the alternative agglomeration occurred outside the UK it would leave us all poorer. The agglomeration economic model is not an easy political sell. Alternatives can appear more attractive. I have no doubt that the foundational economy can be developed and has a role to play, but I when I hear its more gushing advocates I fear that they think it is an opportunity to opt out of the global economy which is focused on agglomeration. That could be hugely damaging. The world economy will not wait for those who opted out to play catch up after the event.

My purpose in writing this post is not to defend the current agglomeration economy model in the UK. I don't actually hold that view. I think agglomeration in the UK has been haphazard and lacked strategy. I believe that with greater coordination from government there is scope to adapt the model in a way in which Britain can be more competitive globally while spreading the benefits of agglomeration economics beyond the very small hubs at present to broader regions. Due to our population density and geography in this country there is scope to create agglomeration regions, so that the success of one city can be shared with neighbouring towns and cities.

However, lockdown has turbo-charged a long touted alternative to agglomeration economics in some sectors at least. Online video conferencing has become a few times a day staple of my work. It is essential in the circumstances, but it has also had a democratising effect which counters agglomeration to an extent. To use one example, a meeting which used to take place in London with fifteen people sat around a table and a couple of others on the phone awaiting their turn to speak will have been replaced with a video call in which all participants are equal size little boxes on the screen able to understand the non-verbal communication and to better understand when to interject into a conversation. This relatively small change makes a meaningful difference. 

Agglomeration can only occur if talented people cluster in the same location, but that location can be online. In the last few weeks, I have taken part in a series of think tank events. While I might have attended the Cardiff-based one in person, I think it is safe to say that I would not have been a participant in the one which took place in Almaty, Kazakhstan, had it not been online. Nor would I have participated in the weekly Centre for Cities events. This kind of debate and discussion is far more prominent in locations with academic and economic agglomeration, but in the last couple of months I can log in from Newport with equal status to those from London or Oxford or anywhere else.

The edge that agglomeration hubs hold over the rest of the country has, in a small way, been eroded during lockdown. We should not lose that little step to a greater democratisation of knowledge and participation.