Producer and Consumer Cities
By Arnold Kling
The sociologist Max Weber introduced a distinction between ‘consumer cities’ and ‘producer cities’…
The classical consumer city is a centre of government and military protection or occupation, which supplies services – administration, protection – in return for taxes, land rent and non-market transactions. Such cities are intimately linked to the state in which they are embedded. The flowering of the state and the expansion of its territory and population tend to produce urban growth, in particular that of the capital city.
In Europe cities are instead much closer to being producer cities. The primary basis of the producer city is the production and exchange of goods and commercial services with the city’s hinterland and other cities. The links that such cities have with the state are typically much weaker since the cities have their own economic bases.
They suggest that around the year 1100, Arab cities were consumer cities and European cities were producer cities, so that economic growth ultimately took off in Europe. Thanks to Tyler Cowen for the pointer.
What interests me about Weber’s distinction between consumer and producer cities is that it relates to my long-standing skepticism about the “market” economies of the Classical period. In my mind, Rome is a consumer city. A characteristic of consumer cities is that they thrive based on predation of the the surrounding area.
The authors write,
Arab cities were part of the ‘predatory’ structure of the state. When the region was unified under the Abbasids, this worked well and the region experienced its ‘Golden Age of Islam’. Efficient institutions regulated exchange, allowing high levels of commercialisation and urbanisation. When state systems disintegrated, so did the urban system and the underlying commercial networks.
In Europe, after a period of disintegration, a different urban system more or less independent of ‘predatory’ states emerged. These managed to claim their own niche in the political economy of the period and developed increasingly effective ways of organising commercial exchange in spite of the fragmented political system.