Year XXIX, 1987, Number 1, Page 54



Jane Jacobs is well-known for her analyses of the urban crisis starting from the observation of urban structure and its relationships with daily life.[1] Disagreeing with the prevailing conceptions of town planning, Jacobs maintains that town planning is still at a rudimental stage of development, comparable to medical science in the last century. Though ignoring the problems posed by the historical evolution of urban life and the city’s relationship with its surrounding territory, her approach is still an important contribution in the debate on the urban crisis. Jacobs’ interest has also been directed to the economic processes of urban development and to what she calls the replacement of imports in city economies.[2]
Recently Jacobs,[3] faithful to a descriptive and empirical type of survey, returned to and expanded on these themes, dealing with those economic and monetary aspects which, in her opinion, have had a decisive influence in differentiating the accumulation of wealth in one city or state as opposed to another.
The spirit with which Jacobs approaches her survey is summarised in a few lines that precede the beginning of the second chapter, not by chance called Back to Reality: “We must find more realistic and fruitful lines of observation and thought than we have tried to use so far. Choosing among the existing schools of thought is bootless. We are on our own” (p. 28).
This harks back to the spirit of autonomous observation found in The Death and Life of Great American Cities. But, unlike her first work, the themes in her survey no longer relate to urban structure but to the interaction between urban phenomenon and the national management of the economy and, in addition, as she herself says, “the distinctions between city economies and the potpourries we call national economies”. Indeed “failures to make such distinctions are directly responsible for many wildly expensive economic debacles in backward countries, debacles which have resulted from the failure to observe that the all-important function of import-replacing or import-substitution is in real life specifically a city function, rather than something a ‘national economy’ can be made to do” (p. 35).[4]
Jacobs concentrates on the effects produced by just one factor considered in different ways: the supply of consumer goods. This restricted field of survey does not, however, take into consideration the contribution made in this field by the German school of geography and in particular by Walter Christaller, in the first half of our century.[5]
Jacobs tries to identify the hurdles which prevent any start being made to the process of replacing imports that occur, or that do not occur, even within states. From the standpoint of the development of the city, Jacobs — without clarifying whether (and how) she believes that different imports have different impacts on economic expansion — argues that whether imported products are of national origin or not makes no difference. What counts is their capacity to replace imports. “Cities that generate city regions of any significance possess that capacity, or have possessed it in the past. The very mechanism of city import-replacing automatically decrees the formation of city regions” (p. 47). On the contrary, “when a city at the nucleus of a city region stagnates and declines, it does so because it no longer experiences from time to time significant episodes of import-replacing” (p. 57). In the course of time, Jacobs recalls, we have witnessed continual transfers of wealth and welfare from one city to the other and, hence, from one empire or state to another: “So far, going back and back to Neolithic times, there seems never to have been a simultaneous deadening of cities over the entire world, and thus no period in which all economic life consisted of bypassed, subsistence life. While Addis Ababa was dying, Rome was rising. While the great cities of China were stagnating, Venice was rising. No doubt in future (provided, of course, there is a future for a world booby-trapped with nuclear weapons), people will remark that while the cities of Great Britain were dying, those of Japan were rising” (p. 134).
But is it correct, historically, to impute these transfers of wealth to cities which represent after all only a very specific portion of the world?
Certainly, Jacobs adopts various historical classifications used by Fernand Braudel, acknowledging her debt with regard to various historical comments (in this respect, see note 4 on p. 236). Various formulations used by Jacobs are very similar to those used by Braudel,[6] without however maintaining the methodological precision of the French historian. Braudel stresses both the rise and fall of the world economies under urban domination and the very different political element in a city-state of the 15th century such as Venice vis-à-vis an 18th century city such as London, “the enormous city that the entire British national market has and hence the British Isles until the day when, with the changed proportions of the world, this agglomerate of power is reduced to the small England vis-à-vis a giant, the United States”.[7]
In this respect, Tokyo and the city-states of the Pacific Rim do not foreshadow a new model of the organization of economic and political life as Jacobs seems to believe, but are a forewarning of the umpteenth historical transfer of economic, commercial resources and political power. They are signs of the décentrage, as Braudel would say, taking place from the shores of the Atlantic to those of the Pacific.
Continuing to ignore the aspects of power that have historically influenced trade, in the second half of her book Jacobs concentrates on the role played by economic competition, and in particular by one of the instruments, namely currency, through which this competition occurs in the process of accumulation of the wealth of a city.
Jacobs thus tries “to argue that national or imperial currencies give faulty and destructive feedback to city economies and that this in turn leads to profound structural economic flaws, some of which cannot be overcome no matter how hard we try” (p. 158). Thus she asks by what mechanisms national monetary sovereignty causes these distorsions.
Jacobs believes that a national monetary sovereignty unifies the widest markets and is accompanied by the removal of tariff barriers between cities in the same state. This she believes is to the advantage, in particular, of cities which carry out a higher degree of international trade and which can hence benefit from the monetary manoeuvres designed to make the national economy competitive (p. 172). Analogously, national tariff policies introduced to protect or encourage the development of certain national productions act in a similar way. They favour an economic flow whose effects on the territory are apparent in a diversified premium in some cities, those in which production can become competitive in international trade vis-à-vis other cities (p. 168).
Secondly, Jacobs asks why, in the long term, even currencies in the great continental states, or empires, cause structural economic flows on the territory which are just as damaging as those produced in the small states.
Jacobs believes that by reducing the number of currencies the mechanisms of automatic regulation of city markets are also reduced and competition mechanisms distorted. From all this, Jacobs draws the conclusion that the creation of only one world state, eliminating all monetary fluctuation, would spell the death of the city.
Finally, to stress the role exerted by currency even in aid policies vis-à-vis the less developed regions Jacobs attempts to demonstrate that unceasing aid, like military production, “undermines both their capacities to generate new kinds of goods and services and to afford problem solving or other innovative exports from one another, even if these are advised” (p. 189). For Jacobs “loans, grants and subsidies sent into regions lacking vigorous cities can shape inert, unbalanced or permanently dependent regions, but are useless for creating self-generating economies — which is to say, useless for creating import-replacing cities” (p. 110).
Her conclusion is that a policy of economic aid would be much better carried out by the multiplication of currencies. For example “if the northern and southern regions of Japan had their own individualized currencies, they could automatically get equivalents of tariffs and export subsidies” (p. 205). Competition between cities, improvisation, innovation, unpredictability of the consequences connected with it, the promotion of creativity are the instruments Jacobs suggests will stimulate the development of the city.
Having criticised the function of the national economies and the absolute sovereignty of the national states Jacobs is faced with two alternatives: either accept the prospect of the end to the national state through the unification of the world, or to propose destroying the current system of national power by promoting the multiplication of local sovereignties. Jacobs chooses the latter without hesitation: “We must be grateful that world government and a world currency are still only dreams” (p. 180). So her desire not to be identified with any of the traditional economic and political schools of thought become turned into an apology for the far from new school of national monetarism.
This is how Jacobs tries to justify her choice of field: “If unhampered trade with one another were all that cities and potential cities needed to flourish, a single world government would be the economic ideal” (p. 209). But the second fundamental need of cities, Jacobs at once adds, is to enrich themselves on an individual basis, through competition, following economic cycles of expansion that do not necessarily coincide with the economic cycles of the state (p. 210). In the theoretical plan the solution “would thus be division of the single sovereignty into a family of smaller sovereignties” so as to produce a “multiplication of currencies” (pp. 214-215). The problem, as she herself admits, lies precisely in the fact that “multiplicities of currencies imply multiplicities of sovereignties” and this can only take place at the expense of the current national unity.
We may note that Jacobs does not propose to tackle and resolve the problems that the crisis of the city currently creates. Rather she wishes to start the history of the city-state all over again, overlooking the fact that currencies are only one of the economic factors of sovereignty and that monetary manoeuvres are unfought wars in which what is at stake is always the transfer of wealth from one region to another. Leaving the outcome of this dispute to power relationships without bothering to submit them to a rational government would mean perpetuating the submission of the regions already at a disadvantage to the law of the strongest.
Just as Christaller’s analysis helps us to understand the factors that determine the creation of a hierarchy in urban functions vis-à-vis territory (see note 5), so in the same way Lionel Robbins[8] helps us to understand the baselessness of conclusions favouring local monetarism which would in actual fact produce an increase in monetary disorder. If we may say that free trade between national sovereignties tends to benefit certain cities at the expense of others, this should not be taken as proof of the need to impoverish them by abolishing all national constraints without bothering to set up a new power structure. The problem if anything is that of eliminating the factors that privilege some cities vis-à-vis others, recalling that trade between sovereign states is never really free, and trying to clarify in what institutional context cities could achieve independence without undermining their very survival.
According to Robbins, the arbitrary fluctuations in exchange rates are the most significant disturbing element in trade. If things were as simple as the supporters of local monetarism claimed, continues Robbins, “we might push the thing to its logical conclusion and ask why each different industry should not have its own money so that, when the value of its products changed, money incomes could be kept constant and the rate of exchange varies”.[9] Naturally such a system would have to be based on the good desire and on the commitment of all independent monetary authorities not to upset the exchange markets and to provide for the possibility of using different currencies throughout the world.
Since history, tormented by the difficult co-existence of many national currencies, has never provided any guarantee about the possibility of encouraging the peaceful and democratic development of trade through conferences, summits and bilateral and multilateral agreements, the final word must belong to a federal authority above the national states, an authority that has final say in preventing individual states, and even more individual cities or industries, from having the power to damage other states and cities arbitrarily.
In this way, concludes Robbins, “the federal authority may decide that it is better that there should be a single money and a unified banking system; in that case none of the difficulties we have been discussing need arise. It may, however, decide that separate systems are desirable; in that case, however, it will retain control of the variations of the rates of exchange and any other regulations which are necessary; there will be the safeguard that what variations take place, take place by federal authority and not by the arbitrary decisions of independent sovereign states”.[10] Robbins openly maintains his preference for the first hypothesis, which would lead to the creation of a single currency.
Jacobs puts forward one further hypothesis which needs to be challenged which she uses as justification of her rejection of a world government: the impossibility of creating the institutions that allow the city to be at the same time independent and subjected to a common government, with a single currency. If Jacobs were right, this would mean being resigned to leaving all the independent entities free, the national states today and the city-states tomorrow, to wage war for their own ends. In an era when cities such as Hong Kong and Singapore are able to produce and use nuclear weapons this would imply believing in the relentlessness of the destruction of the world. Beyond economic and monetary questions, the world must henceforth unite to eliminate war and survive the nuclear era. The road to follow was indicated two centuries ago by Hamilton and a distribution of the power between independent but co-ordinate levels of government is perfectly conceivable, as K.C. Wheare has shown.[11]
The remedies proposed by Jacobs are hence the worst of all evils (the very evils that are supposed to be eliminated). They recall the pseudo-scientific 18th century cures condemned by Jacobs herself. All in all, to paraphrase an essay by Mumford which was perhaps too critical of Jacobs,[12] these are “household remedies for the cancer of the city”.
Franco Spoltore

[1] Jane Jacobs, The Death and Life of Great American Cities, Penguin Books, Harmondsworth, 1961.
[2] Jane Jacobs, The economy of Cities, Penguin Books, Harmondsworth, 1969.
[3] Jane Jacobs, Cities and the Wealth of Nations, Viking Penguin, Harmondsworth, 1985.
[4] In Cities and the Wealth of Nations Jacobs does not explain sufficiently what she means by replacement of city imports, taking for granted that readers understand the terminology she adopted in her previous book The Economy of Cities. But even in that work Jacobs did not clarify in what way replacement of imports differs from an autarkic policy (the use of the expression import replacement rather than import substitution she believes is sufficient to clarify what she means). This ambiguity hides, as emerges subsequently from the book, the a priori refusal to consider the fact that trade in itself has historically been the greatest factor in historical development. Only by referring to the development of trade is it possible to explain the historical changes that have taken place in the flow of imports and exports between the different areas of the world. This is, moreover, the standpoint that Henri Pirenne put forward in Les villes du Moyen Age (Maurice Lamertin, Bruxelles, 1927): “Only in the 12th century… under the influence of trade (the italics are mine), did the ancient Roman cities revive their fortunes and become repopulated; commercial agglomerates grew up on the outskirts of boroughs, along the seacoasts, rivers, confluences of watercourses and the crossroads of natural means of communication. Each of them constitutes a market whose attraction, proportionate to the size, exerted itself on the surrounding countryside or made itself felt a long way off. Great and small, cities are scattered everywhere, on average one every five square leagues: in effect they have become vital to society. They have introduced a division of labour which we can no longer do without. A mutual exchange of services takes place between the city and the countryside” (p. 70). It is not that Jacobs does not take these phenomena into consideration. She simply links them to a process, replacing imports, which remains undefined and not clarified except with reference to the causes of the evolution of trade. What Jacobs herself says is as follows: “The expansion that derives from the replacement of city imports consists precisely in these five forms of growth: sudden increase in the city market because of new and different imports, mainly consisting of agricultural produce and by innovations produced in other cities; sudden increase in the number and types of work in the cities capable of replacing imports; increase in the transfer of work in non-urban areas when the oldest industries no longer have the room to develop within the city; new technological applications, in particular to increase agricultural production, and productivity; growth in the city’s capital” (p.42).
[5] Walter Christaller, Die zentralen Orte in Suddeutschland. Eine ökonomischgeographische Untersuchung über die Gesetzmassigkeit der Verbreitung und Entwildung der Siedlungen mit städtischen Funktionen, G.Fischer, Jena, 1933. The analysis of the German geographer deals with the effects produced on the distribution of urban functions, as well as the market, the evolution of the transport system, the choice of the administrative headquarters, and fiscal policy. Thanks to these intuitions, Christaller (unlike Jacobs, who was not able to explain, for example, why no co-ordinated development of two cities like Buenos Aires and Montevideo arose despite the fact they both overlook the River Plate) is able to explain the effects induced by the creation of artificial barriers such as national borders: “Most of the present crisis that affects Central and Southern Europe, in particular Austria and Hungary”, wrote Christaller in 1933, “has been conditioned by the sudden and massive dismembering of the system of central places due to the creation of new borders. This caused a devaluation, at times grotesque, of the already existing central institutions and a contemporary need to create new central institutions — not just government institutions, but also private, cultural, commercial and industrial ones. Moreover, there was a general change in the value of costs, tariffs, and demand etc., that is perhaps even more significant than the clear transformation of central institutions” (p. 163).
[6] Fernand Braudel, Civilisation matérielle, économie et capitalisme (XV-XVIII siècle). Le temps du monde, Librairie Armand Colin, Paris, 1979. In expounding the tendential regulations that “specify and define even their relationships with space”, Braudel writes: “There is no world-economy without its own space and for the most significant reasons: it has its own borders, and the line which surrounds it gives it a particular sense much as the coasts define the sea. It implies a centre, favouring a particular city and an already dominating capitalism, whatever the form may be. The multiplication of centres constitutes a witness of youth, or a form of degeneration or of mutation. Under the drive of external and internal forces, forms of decentralisation can in fact arise and hence be achieved: cities with an international vocation, ‘world cities’, are in continual competition with each other, and go on replacing each other; ordered hierarchically, this space is the sum of particular economies, some poor, some modest, only one relatively rich in its own nucleus. Inequalities arise, differences in the voltage that ensure the functioning of the whole. The result is ‘the international division of labour’, regarding which Sweezy explains how Marx failed to forecast that it ‘would be turned into a (spatial) model of development and underdevelopment such as to divide mankind into two fields, the haves and haves not, separated by an even more deeper gulf than the one which opposes bourgeoisie and proletariat in advanced capitalist countries’. This is not, however, a ‘new’ separation, but an old wound, one which probably cannot be healed. A wound that existed long before the times of Marx” (p. 7).
[7] Op. cit., p. 17.
[8] Lionel Robbins, “Economic Aspects of Federation,” in Federal Union. A Symposium, Jonathan Cape, London, 1940.
[9] Op. cit., p. 178.
[10] Op. cit., p. 179.
[11] K.C. Wheare, Federal Government, Oxford University Press, Ely House, 1967.
[12] Lewis Mumford, The Urban Prospect, 1956, cfr. the essay on Jacobs taken from The New Yorker of December 1st, 1962.


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