Was that Policy Exchange report so wrong after all?

That's the question James asks over there a page or two. Having had a weekend to think about it (yes, mine was lovely, thank you, and yours?) I think I might be able to give an answer.

Yes.

That we can't buck economic geography is true, just as we can't buck markets. But what seems to be missing is that economic geography is determined by technology. The port and industrial cities of the north were indeed responses to the available technologies of the times: Bristol and Liverpool grew as sailing ships find it rather difficult to get around to the older east coast ports. The mill towns were originally where the water power was, to be replaced by the nearby coal as technology changed (and the mill towns like Stroud lost out as there was no easily transportable coal nearby).

As any fule kno in recent decades that economic geography has been hugely changed by the system of containerisation. If you're on that grid, that network, your location is trivially important: if you're not, almost nothing will get you into the global economy.

We're currently going through a vast change in economic geography again, as these intertubes that we're currently playing on work their way through the system. Like all major technological changes it's going to take decades (both coal and then subsequently electrification are thought to have taken 40-50 years to pass through the python of the economy) to find out what are the real implications, the changes that will come.

The way we actually do the experiments, the way that we find out what works and what doesn't is through markets of course. People try all sorts of different things in the face and usage of a new technology. Some work, some don't, we all copy those that do.

The real problem with the report then is not that they said write off the northern cities (which isn't quite what they said anyway). It's that they thought that the coming changes could be planned.

They can't be because we don't know what's going to happen. Further, we won't know what's going to happen until it has. So we cannot plan, making the entire exercise one in futility.

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