What makes cities thrive? Is it proximity to natural resources like rivers, oceans or energy reserves? Or does the cumulative effect of population increases stimulate waves of economic activity such as restaurants, bars and shops?  Because of the complex history of many cities, identifying the source of their development is notoriously difficult. But a group of urban economists have developed a model that shows the positive relationship between economic activity and urban density, and predicts how further development will change a city and its surrounding areas.  Such is the scale of their achievement, Gabriel Ahlfeldt, Stephen Redding, Daniel Sturm, and Nikolaus Wolf, who began the project almost a decade ago at LSE, have received the Frisch Medal, one of the most prestigious prizes in economics. 

Read more... LSE News