By Justine Pascone, USC Master of Planning, 2016

On February 25, University of Southern California Professor Emeritus Peter Gordon presented his research, “What Do We Know About Economic Development? What Do We Know About Cities and Networks? How Are They Linked? “ to practitioners, professors, and students on the USC campus as part of the METRANS Spring 2015 Transportation Research Seminar Series.

Professor Gordon relates his research to the same economic question Adam Smith asked over 200 years ago, ‘Why are some countries rich and why are some poor? and what accounts for their economic growth differences?’  As the title of his research suggests, Gordon’s seminar focused on the links between economic growth and development within cities and networks.

Gordon’s research spoke to both practitioners and students.  Dhiraj Narayan, an alumnus of the USC Price School and assistant director at the City of Los Angeles’ Housing Authority noted the depth and insightful takeaways he gained, saying the seminar helped him “to think beyond one's immediate work, (and to) hear ideas that expand our knowledge and help in allowing us to do our jobs.”

Gordon addressed the claim that cities exist because they facilitate economic growth and development. He explained that spatial concentrations reduce transaction costs and that there are additional benefits gained as positive spillover effects are realized.

Drew Lawlor, another USC Price School Alumnus, shared many of the students’ concerns and the applicability of Gordon’s research to them.  “We are in the midst of changes in our city and there are strong differences in views as to development,” he noted.  “I am after (these) facts to be able to discuss the issues with facts and knowledge behind me.”

Gordon concluded by noting that successful cities manage to make significant economies available to very large numbers of people and firms.  “The evolution of transaction costs” is a key part of the explanation of our economic and social development, he said. The key for successful cities and economies are institutions that properly incentivize people and reduce transaction costs. 

Terri Huerta, a USC alumnus who works for the San Gabriel Chamber of Commerce Legislative Committee, echoed the professor's thoughts, commenting that she “received information about the fundamental approach towards how cities grow, how they are really ‘beds’ for trial and error entrepreneurialism.”  Gordon’s research found that from this entrepreneurialism comes new arrangements of thoughts and ideas. The thoughts of others facilitate new combinations of ideas and economies benefit thusly.

Peter Gordon is Professor Emeritus at the University of Southern California's Price School of Public Policy, where he taught and conducted research for 43 years until his retirement at the end of 2013.  Gordon's research interests are in applied urban economics.  Gordon and his colleagues developed various economic impact models which they applied to the study of the effects of infrastructure investments or disruptions from natural events or terrorist attacks.  In addition, he continues to be interested in urban structure and how it relates to economic growth along with the associated policy implications.  Peter Gordon has published in most of the major urban planning, urban transportation and regional science journals. He is a Fellow of the Regional Science Association International.  He has consulted for local, state and federal agencies, the World Bank, the United Nations and many private groups.  Gordon received his Ph.D. from the University of Pennsylvania in 1971.

Gordon's full presentation can be viewed on YouTube at:  https://www.youtube.com/watch?v=sUy4neiUhgU