Economists are underestimating the costs of letting small Rust Belt cities shrink

If you ask economists what to do for struggling towns in the Rust Belt, a lot of them have a simple answer, according economist Adam Ozimek: nothing. Economists focus on helping people, not places. And often the best move for someone in a declining town is to find a new job in a different city where jobs are more plentiful.

But Ozimek argues that they’re making a mistake. He says that small, economically struggling places have value that’s not always captured by simple economic models.

This isn’t just a theoretical question for Ozimek, an economist and blogger who lives in the small city of Lancaster, Pennsylvania. He lives close enough to Philadelphia that he can drive to the offices of his firm, Moody’s Analytics, in the Philadelphia suburbs in about an hour. But many days he works from home, enjoying the low cost of living and other benefits of life in a small city.

Rather than dismissing small cities and towns, Ozimek argues that economists and policymakers should be thinking harder about how to support them. That’s good for the people who will inevitably be left behind if these areas continue to lose population. And it may even be better for the US economy as a whole.

Read more here.

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