Economic Engines

The Other Digital Divide

Much has been written about the so-called “digital divide,” the technology availability gap between the richer and the poorer. But as digitally enabled government comes to the fore, we may be risking the emergence of a new kind of digital divide, between the largest, most richly resourced cities and smaller communities with less capability to exploit new technologies.

There’s certainly plenty of activity on the digital front in big cities. New York City is using technology to help building inspectors and fire officials prioritize the riskiest buildings for complaint investigations. Chicago is using predictive analytics to target rat infestations before they happen. Washington, D.C., has rolled out digital tools to let citizens grade the quality of their government services. Boston has a mobile phone app called Street Bump that detects when a car runs over a pothole and alerts city officials to get it repaired. READ MORE

How Airline Mergers and Deregulation Hurt Travel

You can dip your toe into a river free of charge. Same with an ocean. It’s pretty clear that rivers and oceans are public. Private companies use them, but they don’t own them. Government ensures open access to them via a public boat dock or a beach.

The same goes for most roads. With the exception of the occasional private turnpike, government builds roads and opens them to everyone. But what about the sky? Who owns the sky? READ MORE

Where’s America’s Entrepreneurial Economy?

In many ways, it seems like this would be a golden age for freelancing and entrepreneurship: The Web, after all, makes it easy to market yourself and your firm. The growth of co-working space reduces the cost of an office. Open-source data and the cloud make it inexpensive to start a tech company, compared to the millions of dollars in startup capital needed during the dot-com era. “Makerspaces” provide low-cost access to expensive equipment to design and manufacture products. Obamacare ensures that health insurance is always available. And the job losses of recent years have produced incentives for self-employment, for transitional purposes if nothing else.

Yet despite our perceptions, entrepreneurship has trended downward in recent decades. The Brookings Institution found that so-called “firm entry rates” have declined since the 1970s and that they suffered a steep fall post-2005. And though millennials are often seen as an entrepreneurial generation, The Wall Street Journal reports that business ownership among those under the age of 30 recently hit a 24-year low. Self-employment has seen a similar downward trend. A study by Economic Modeling Specialists International found that both the total number of self-employed and their share of jobs have fallen since 2006. READ MORE

NYC’s Plan for Free, Citywide Wi-Fi

What is a phone booth without a phone? In general, it’s an eyesore. But not in New York City, where beginning this year old phone booths will be transformed into about 10,000 sleek metal slabs that will provide high-speed digital access throughout the entire city.

The plan is called LinkNYC, and it’s important for two reasons. One, it may be a plan other cities can copy -- there are certainly plenty of old public pay phones around. Two, it’s an example of reimagining old assets and connecting citizens to what is increasingly a vital and life-enhancing service: the Internet. READ MORE

The Myths of Municipal Mergers

In the wake of the events in Ferguson, Mo., much of the media coverage focused on the geopolitical fragmentation of the St. Louis area, and the abuses it has engendered. In some circles, it led to talk of government consolidation, or “big box” government, as a possible solution.

St. Louis County has 90 municipalities. (This doesn’t include the city of St. Louis, which is technically an “independent city.”) Believe it or not, with 22,000 residents, Ferguson is one of the biggest. A number of the municipalities have fewer than 1,000 people. This proliferation of small cities has created perverse incentives to bad and abusive governance. But while there may be clear benefits to consolidation, is it really the answer here? READ MORE