The Wealth of Humans: Work, Power, and Status in the Twenty-First Century by Ryan Avent

Author:Ryan Avent [Avent, Ryan]
Language: eng
Format: epub
Tags: Business & Economics, Labor, Economic Conditions, Economic History, Technology & Engineering, Social Aspects
ISBN: 9781466887190
Google: _LSpCgAAQBAJ
Amazon: B0166SLTB8
Publisher: St. Martin's Press
Published: 2016-09-20T04:00:00+00:00

3

The Digital Economy Goes Wrong

7

Playgrounds of the 1 per cent

London is the richest city in Europe. Real output per person in central London is nearly four times the average in the European Union, and nearly twice that in Europe’s other large, rich metropolitan areas, such as Amsterdam and Paris. Strikingly, London is more than twice as rich as the next richest region within Britain. However one slices it, the city is an extraordinary economic outlier.

The wealth of inner London radiates off the streets and storefronts like heat. Office prices in St James, the neighbourhood in which I work, are among the highest in the world. Art galleries line the streets around the main editorial offices of The Economist,* stuffed with works with seven-figure price tags. Around the corner, on Jermyn Street, bespoke shirts and suits can be yours for just an arm and a leg. Nearby there are two places to buy yachts. Maseratis and Bentleys roll through the streets.

This corner of the city is home to royalty: both Buckingham and St James’s palaces sit within a stone’s throw. But it isn’t the Windsors buying up all the £5,000 Grand Cru in my neighbourhood; it’s the traders. While the big banks operate in the ‘Square Mile’ (the historic City of London) or Canary Wharf, hedge funds and private equity shops increasingly locate in the West End. Their presence has ushered what was already an extremely tony area to new levels of toniness.

Tech start-ups, by contrast, once concentrated near ‘Silicon Roundabout’ – the Old Street area, just north of the City – but are now as likely to be found in Shoreditch, in gritty, hip East London, or south of the Thames: on the South Bank or farther south and west near Wandsworth. That’s where I live, in a beautiful neighbourhood I can’t really afford, surrounded by hard-charging professionals of all sorts, living the high life in a city that has become a playground for the rich, the quite rich, and the really very rich.

London shares space at the pinnacle of the global economy with just a few other elite cities, among them New York and San Francisco. These cities host the working rich, whose skills and habits mesh perfectly with the technologies and institutions of the digital economy, who are responsible for the creation and management of an enormous share of the rich-world’s economic value (and whose earnings are a larger share still of national income). Their productivity contributes to the abundance of less-skilled labour (some of which they re-absorb in their households, as nannies, personal trainers and personal shoppers). Their concentration in rich cities nurtures their careers, turns their neighbourhoods into playgrounds for the elite, and abets the capture of an outsize share of the returns to economic growth. The extraordinary cost of the real estate in these pinnacles of prosperity means that they are effectively inaccessible to most of the labour force: to those not able to earn 1 per cent salaries or not willing to pay huge sums to live in minute apartments in inconvenient neighbourhoods.

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