The rise of the mega-region

Abstract

This paper examines the emergence of mega-regions as a new and significant economic unit. The authors argue that the traditional focus on nation-states as the primary drivers of economic growth is no longer valid in a globalized world, where capital and talent flow freely across borders. Mega-regions, defined as integrated sets of cities and their surrounding suburban hinterlands, are increasingly becoming the natural economic units of the global economy. The authors use a global dataset of nighttime light emissions to systematically define and analyze the world’s largest mega-regions, estimating their economic activity, population, technological innovation (using patent data), and scientific innovation (using data on highly cited scientific authors). They find that a small number of mega-regions – only 40 out of thousands of cities – account for a disproportionate share of global economic activity and innovation. The authors conclude that geography and location still matter in a globalized world, and that understanding the role of human capital externalities in the formation and functioning of mega-regions is an important task for future research. – AI-generated abstract