Industrial clusters and thick labor markets

I’m waiting for a huge piece of code to rerun and I should not be working on a cognitively intensive revise and resubmit on a Friday afternoon, so I want to go back to what I originally went to grad school for — urban economics and economic development — for a minute to respond to a seemingly populist and really dumb proposal to strip the federal government of expertise proposed by Andrew Yang.

Let’s think about Washington DC’s primary export industry as government and more specifically federal government leadership and top level analysis and management. The federal government is an industrial cluster in DC much like venture capital fueled technology firms are an industrial cluster in San Francisco-San Jose region, bio-tech is a cluster in Greater Boston and steel was a cluster in Pittsburgh. Clusters are interesting in that they are often positive feedback loops until they run into hard constraints or a massive external shock.

There is a huge literature on the positive feedback loops on economically successful clusters. One of the major drivers is that a cluster creates a rich and thick labor market. This means that at any given point, there are lots of good jobs available to anyone who is qualified to work in the cluster. People aren’t locked into a “good enough” job because that is the only job available that utilizes any specific human capital/education/tacit knowledge available to them, but that people can readily shift between positions to maximize their personal gain. In Washington DC, if someone is a research economist, there are a hundred opportunities within seven Metro stops of their current place of employment. If someone is a research economist in Sault Ste. Marie, there may be one or two within an hour of their current place of employment. The same applies for geneticists who work in Boston vs. geneticists who work in Boise.

Employment concentration creates specialization and optimization. It allows for work to be more productive as the cluster grows and the labor market becomes even thicker and deeper. This is all pretty standard.

There is another labor market point to make; large urban areas have lots of jobs that are not in the primary export industry. This could matter for me at some point in the future as I could easily see myself spending a couple of years working for either the federal government in the DC-Baltimore region or working for an entity that directly services the federal management and analysis industrial cluster. My wife has a skill set that could translate into this industrial sector but her current experience is in a general professional environment. If my options for moving to DC for federal work or Boone, North Carolina, my wife will far more readily find a good enough job in DC.

Dispersing the vast majority of the DC/Baltimore/NOVA government management and analysis cluster that has been built up over four generations is a great way to make the federal government less efficient and less attractive to top tier talent especially if the dispersion would be going to smaller urban clusters with far shallower and thinner labor markets.








Repub-on-Repub Open Thread: Speaking of DISARRAY!!!

This weekend, a few dozen once-prominent GOP foreign policy figures, including some original “never Trumpers,” are gathering at a private Reagan Institute retreat in Beaver Creek, Colo., to promote and preserve the 40th president’s “conservative internationalist” approach to foreign affairs. Yet the White House has shown little willingness to tap into this wellspring of expertise, even as Trump cycles through national security aides and faces a dwindling pool of experienced staffers for a potential second term.

The ostracizing of the group has led some to reconsider their roles in a prominent public movement to stop Trump three years ago.

“I’m not comfortable with letters anymore,” said Patrick Cronin, head of the Asia-Pacific security program at the Hudson Institute, who signed the first letter, which called Trump “fundamentally dishonest” and “utterly unfitted to the office.” In March 2017, Cronin was forced to withdraw from a new position overseeing a Pentagon think tank after Trump allies blasted his appointment by then-Defense Secretary Jim Mattis…

Read more








Both Sides From The New York Times

My Twitter lit up this morning with Bret Stephens’s call to sink Iran’s navy. But nobody wants war, he assures us.

Right next door (figuratively speaking), Eliot Higgins has an excellent explainer on the evidence proffered so far and how to analyze it. If you want to learn more about how to do open-source intelligence, take some time with this article.

Stephens’s piece, of course, offers nothing remotely like evidence.

And the Times Editorial Board advises the President to heed his deal-making reflex, not his hawkish advisers.

I guess two out of three isn’t too bad.

Open thread – slow afternoon.








Cohen Testimony Open Thread: Breakout ‘Stars’

I’m putting together a tweet-narrative on some of the GOP sideshow artistes who particularly beclowned themselves today, but first, strong supporting character noms for two of today’s partipants.

Steve Lynch (D-Southie) has not always endeared himself to the rest of us Masshole Dems, but he deserves credit for this:


Who is Jody Hice?


 
On the opposite end of the vertebrate spectrum, do *not* overlook Clay Higgins:

Moron, or miscreant? Why not both?








Global Warming – The Message Is Getting Through

The New York Times reports on a new poll.

A record number of Americans understand that climate change is real, according to a new survey, and they are increasingly worried about its effects in their lives today.

Two important takeaways:

First, the results themselves. “I’ve never seen jumps in some of the key indicators like this,” one of the investigators said.

Second, the Times saw no need to “balance” the results with a statement from a self-identified scientist living in his mother’s basement. Further, they used the word “understand” four times to describe the respondents’ relationship to the facts of global warming.

Real progress.

And open thread.