From the New York Times:
Yes, Rich Cities Are Getting Richer. But That’s Not the Whole Story.
Even with widening geographic inequality, economic activity is less concentrated in a few top metro areas than in the past.
By Jed Kolko
Feb. 19, 2020
… The places getting richer aren’t the places getting bigger.
The metropolitan areas with the most rapid per-person income growth since 1980 have had only modest population increases. Think of the Bay Area, Boston and Fairfield County in Connecticut. Conversely, most places with huge population gains have had only modest income growth. They’re not getting much richer. Think of places like Las Vegas, Phoenix and Orlando.
One basic factor that I call the Dirt Gap is that inland metro areas can typically expand almost 360 degrees, while coastal cities can expand roughly 180 degrees (or less in the case of the cities of San Francisco and Boston). This keeps land prices down in inland cities.
Another aspect is that coastlines are usually a really nice amenity, with the exception of the Gulf Coast where the hurricane threat is so large that the big cities tend to be located inland — e.g., Houston replaced Galveston as the metropolis of the Texas Gulf Coast after 6000 Galvestonians died in the 1900 hurricane. Houston is 45 miles inland and 45 feet above sea level. (And it still gets flooded a lot.)
In other words, in almost all cases, economically successful places in America have gotten bigger or richer but not both. (There are also plenty of metros that have had slow population growth and slow income growth, like Detroit, Cleveland, Oklahoma City and Rochester, N.Y.)
What’s Oklahoma City doing wrong? Does Dallas-Fort Worth just overwhelm everything in the region?
Those rare exceptions with big growth in both per-person income and population include Austin, Texas; Raleigh, N.C.; and Provo-Orem, Utah, as well as the smaller metros of Naples, Fla., and Fayetteville, Ark. (home of Walmart). But the largest of these, Austin, still ranked only 27th among metros in total income in 2018 even after many boom years.
Austin is still only the 30th largest metropolitan statistical area in the U.S., even though when I was at Rice U. in Houston in the 1970s, everybody agreed that Austin was the nicest city in Texas. It has some scenery compared to most of urban Texas being dead flat. Does Austin have more German-Americans than the other big cities in Texas? Germans tend to be more cooperative than Scots-Irish, who tend to be ornerier and more individualistic.
Among the 10 metros with the largest economies today, not one is getting both much richer and much bigger. In fact, in the past year the three metros at the top — New York, Los Angeles and Chicago — all lost population.