Introduction

It happened on October 12, 1999, at least according to the United Nations (UN). From that day more than 6 billion people have inhabited the planet Earth. Of course, given the inaccuracy of the data, the UN could have been off by 100 million people or so. Every day some 100 million billion sperms are released and 400,000 babies are born, whereas “only” 140,000 persons die. Consequently, the world population has been growing rapidly, especially over the second half of the twentieth century. Given the average population density in the world, about 44 persons per square kilometer, if you are part of a family with two children, your family could have about 9 hectares (or 22.5 acres) at its disposal. The large majority of our readers will probably look around in amazement to conclude that they do not own an area close to this size. The reason is simple: the world population is unevenly distributed. But why?

There may be many reasons why people cluster together: sociological – you like to interact with other human beings; psychological – you are afraid to be alone; historical – your grandfather already lived where you live now; cultural – the atmosphere here is unlike anywhere else in the world; geographical – the scenery is breathtaking and the beach is wonderful. At best we will discuss the above reasons for clustering only cursorily, because our attention in this book will be focused on the economic rationale behind clustering or agglomeration.