We are based in the Capitol Hill neighborhood of Seattle. There are currently (October 2013) lots of new buildings, full of apartments, going up all around us in the neighborhood, downtown, in many of the closer to downtown neighborhoods of the city. Density is going up. Which may have many and sundry follow-on effects, for better or for worse. I'd like to focus on one here, that density will lead to new businesses and new business models.
We deliver all over the city, but keeping deliveries close makes them easier, faster, and gives us more flexibility to schedule them close together. The more people live in dense neighborhoods, and we are located near those people, the more we benefit from these effects. Simply as a matter of statistics, the mean distance between us and the customer is closer. This effect goes away if we are not co-located with the density (e.g. if we were out in the suburbs).
But that's just for our peculiar model. What else does one expect with higher density? Following the NYC example you'd expect smaller apartments and more restaurants per capita. But that may be a cultural effect, because it is still fairly easy to prepare a meal even in a small kitchen. The ubiquitous food delivery by bicycle. The obvious businesses all likely increase but not in a per capita sense -- more supermarkets, dry cleaners, etc. but not relatively more.
Perhaps I'm thinking too provincially. What about Hong Kong or Singapore. Well there's this handy guide to building density from the government of Singapore. http://www.uli.org/press-release/10-principles-singapore/. Many of the points there are basic governance -- such as city planning for density with green space -- but some of them strike me as actionable for the private sector.
For a more systematic look at general economic effects of density, there is a great report from the British Property Federation. To some extent this report details what economists and historians have understood the basic roles of cities, even civilization to be: Economic specialization (e.g. electrician and plumber and roofer instead of all-purpose builder), person-to-person knowledge transfer, larger market of consumers, larger labor market, more competitive business atmosphere. Each of these gives a list of new opportunities. Just consider specialization -- our business is a version of this, specializing in the long-timescale portion of an existing market in bike rentals.
This is where my imagination fails me, but my aim is not to produce a list of high-density business ideas, rather just to make the simple point that underneath all of the cranes and beside the trucks full of debris, there is a world of opportunity in density.
