Why size really doesn't matter: from megacity myths to place-sensitive prosperity

Rodríguez-Pose, Andrés ORCID: 0000-0002-8041-0856 (2025) Why size really doesn't matter: from megacity myths to place-sensitive prosperity. Spatial Economic Analysis. ISSN 1742-1772 (In Press)

Text (Spatial Economic Analysis 2026 final working paper version) - Accepted Version Pending embargo until 1 January 2100. Download (229kB)

Abstract

This paper offers a critical review and synthesis of the literature on the relationship between urban agglomeration, density, and regional prosperity. Agglomeration and density have long been portrayed as the core drivers of urban and regional success. Yet the evidence remains stubbornly inconclusive: some large cities flourish while others stagnate, and many smaller cities quietly outperform their sprawling counterparts. If density were destiny, the world’s largest cities would consistently lead in wealth and opportunity. However, they frequently do not. The paper argues that genuine sources of growth lie instead in institutional quality, the resilience of local ecosystems, and the strength of inter-territorial linkages. Conventional models have mostly dwelt on a narrow set of negative externalities —congestion, high rents, pollution— while overlooking deeper structural costs: territorial inequalities that erode trust, trigger discontent, and consign whole cities and regions to prolonged decline. As political and social fractures within countries widen, it is increasingly evident that prosperity hinges not on agglomeration itself but on the conditions of cities and their relationships with their hinterlands. The way forward requires a shift in policy and analysis towards place-sensitive strategies and robust institutions capable of promoting inclusive prosperity across all cities and regions, rather than privileging a select few.

Item Type:	Article
Divisions:	Geography and Environment
Subjects:	G Geography. Anthropology. Recreation > G Geography (General) H Social Sciences > HB Economic Theory
JEL classification:	R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, and Changes R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O18 - Regional, Urban, and Rural Analyses P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P25 - Urban, Rural, and Regional Economics; Housing; Transportation
Date Deposited:	15 Dec 2025 11:36
Last Modified:	22 Dec 2025 15:12
URI:	http://eprints.lse.ac.uk/id/eprint/130618

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