Urban employment and services benefit from the economies of agglomeration— from cost savings and other advantages that accrue to firms when they locate near others in the same industry, or simply near other economic activities to share markets, services, infrastructure, labor, and information. The productivity advantage means that urban investment has strong multiplier effects in stimulating other high-value activities. The benefits extend to rural areas, which need access to urban markets to expand and diversify both farm and nonfarm production.
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