Re-examining the relationship: urban economic performance and external economies

Abstract

Debates on the prominent role of cities in the globally integrated economy create an unequivocal impression that, firstly, cities are engines of national and global economies, and, secondly, urban economic growth ultimately depends on cities’ embeddedness in diverse networks. This discussion has resulted in the implementation of urban policies seeking to generate economic growth by improving the cities’ position within multidimensional interurban relations worldwide. Network connectivity undoubtedly affects urban performance. However, so far, the dialectical relations between urban economic growth and network economies have created much room for critical reflection. The paper addresses this issue and problematizes the current state of research on the interplay of external economies and urban economic growth both as a theoretical concept and as a possible translation into urban policies. Russia presents a distinct case of urbanization not only due to the combination of internal factors but also to the government’s approach to cities in the history of national urbanization. Nowadays the Russian government seeks to reconsider the role of cities in national economy and accelerate their development. The analysis has revealed that the interplay between network economies and urban economic performance hinges on the distinct local context. Thus, considering the factors that determine Russia’s spatial and economic development, it is essential to study the growth potential of the main urban agglomerations and amplification of network economies between middle and small size cities to maintain the whole national system of cities. The complementarity of these versions of spatial development would contribute to the search for the path of further spatial and economic development in Russia.