[danans]

> areas outside of tech hubs will become increasingly commodified (one giant suburb), stratified and divided into castes - Executives will tend to cluster around hub centers, middle managers around suburbs, ICs around exurbs and further; moving up will require "moving inwards"

Isn't this already the general pattern? I see that continuing, but with a very slight diminishing of the mega-hubs and a slight boost to secondary hubs (Austin, Boulder, etc).

> For diffusion: - Propped up by inflated prices out of line with their underlying assets, hubs will crash economically when people have the option to work there without living there

I think any prediction of the loss of the significance of cities is pretty far fetched. Cities have been robust to millenia of changes, including multiple past pandemics that have always disproportionately affected them vs more remote areas.

> [Companies] will learn to work remotely to gain an edge in OpEx over competitors that don't and through lower margins gradually beat competitors that don't adapt into submission

This will only happen in sectors with competition over thin margins and high OpEx as a percentage of expenditures, like running a manufacturing plant. That doesn't really reflect the kind of tech work done in tech hubs, which is CapEx and creativity heavy. Even pure software has to stay abreast of consumer and cultural trends, which are largely form in cities. A lot of software are dynamic cultural products, similar in many ways to movies, music, and TV shows. It could. however, affect things like consumer-facing tech support, but that has largely already taken place - a lot of tech support for major companies happens out of lower cost cities in the US, not the expensive tech hubs.

[yowlingcat]

Excellent points. I'm again reminded of this 2S[1] investment article about the value of gross margins. I find particularly insightful your comment about tech work done in tech hubs which is CapEx, creativity and presumably margin heavy as well (to support the first two). One could say, well isn't it possible for this work to dry up? And yet, on the other hand, the whole point of investing is to perennially keep a portfolio fresh and full of the most cutting edge, margin heavy firms (when adjusted for risk adjusted returns compared to the nominal risk free return rate). Well, theoretically anyways.

[1] https://twosigmaventures.com/blog/article/why-gross-margins-...

[danans]

> And yet, on the other hand, the whole point of investing is to perennially keep a portfolio fresh and full of the most cutting edge, margin heavy firms (when adjusted for risk adjusted returns compared to the nominal risk free return rate). Well, theoretically anyways.

I understand what you are saying here, but this perspective sees investment as the driver of the creativity of cities, while another perspective that I put more weight on is that the creativity of cities and the culture they create is a byproduct of human social/group psychology, itself a result of the fundamental reality that there is more security in numbers.

Investment, whether private or public, is then just a way of incentivizing the creativity machine of natural human agglomerations to produce ever more novel stuff.

Or put more succinctly: culture leads, investment follows.

[yowlingcat]

It's an argument with a lot of merit. I think there's a chicken and the egg situation, but I think you're right in that the prime mover is probably the culture rather than investment. That goes along with another saying I think I've seen a lot of mileage, which is that politics is downstream from culture. Seems to follow that investment would follow too from there as well.