This paper examines the dynamics of economic change in the City of Paterson, New Jersey, from the time of its founding in the late eighteenth century to 1990, with emphasis on the post-1945 era. Analysis shows that from the time of its founding to the first half of the twentieth century, Paterson experienced a period of economic growth followed by economic decline in the 1960s, characterized by major changes in its principal industries of cotton, locomotives, and silk. Economic growth in Paterson up to the early part of the twentieth century is attributable to several locational factors, including the availability of water resources, transportation, labor supply, and markets. Its decline in the post-1945 era is attributable to a combination of local, national, and global economic factors including periods of depression, labor discord, product substitution, decentralization of economic activities, and deindustrialization. Economic decline resulted in a high rate of unemployment, poverty, and urban decay. The most significant effort to reverse urban decline in the city is the urban enterprise zone (UEZ) program. The impacts of this program on economic growth in the city, however, remain inconclusive. 1. Introduction Historically, American cities have been characterized by periodic changes in their economic base. Changes in the economic base of cities have been especially pronounced since 1945. The nature, scope, and outcome of these changes, however, have not been the same for every city. While some cities have experienced growth, others have declined or stagnated. These changes have caused differential urban growth and resulted in hierarchical changes in the US urban system. Economic change in American cities has resulted from the interplay of a range of local, regional, national, and global forces [1–7]. In the post-1945 period in particular, the forces of globalization, economic internationalization, mobility of capital, technological change, and changing international migration patterns have significantly shaped American cities [8]. One of the most dramatic economic changes in USA since the 1960s has been the decline of manufacturing employment [9]. This process, called by Bluestone and Harrison [10] as “deindustrialization,” has been defined as “the systematic disinvestment in a nation’s core manufacturing industries.” Deindustrialization is generally attributed to a range of factors including economic globalization, the growing challenge to American global economic dominance, the ability of large corporations to shift capital from one area to
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