The Cost of Hegemony: The Interplay Between Urban Concentration and Growth (1400–1800)

The article investigates the influence of institutional frameworks on spatial development patterns in the preindustrial world, exploring how the degree of urban concentration may determine whether societies experienced urbanization ‘with’ or ‘without’ growth. We hypothesize that the emergence of centralized/extractive institutions in the capital city, which tend to siphon resources from hinterland cities, results in artificially inflated urbanization levels despite congestion problems and economic stagnation. In contrast, decentralized/inclusive institutions, fostering a balanced and autonomous urbanization process, are associated with economic growth. We conduct a historical and empirical analysis of the Republic of Genoa from 1400 to 1800. Our findings suggest that extractive and centralized institutions in the capital city of Genoa led to centralized and congested urban growth, restricting the autonomy and expansion of peripheral cities and negatively impacting the Republic's overall economic development, at least until new policies were enacted in the eighteenth century. Consequently, the emergence of more inclusive institutions fostered the development of peripheral cities, resulting in urbanization that was more balanced and coupled with economic growth. This pattern shows that urbanization is virtuous when decoupled from urban concentration, whereas their simultaneous increase reflects economic stagnation, integrating both urbanization ‘with’ and ‘without’ growth into a unified framework.