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Urban Studies Research
Volume 2014 (2014), Article ID 672794, 9 pages
Research Article

Economic Transition in the City of Paterson, New Jersey (America’s First Planned Industrial City): Causes, Impacts, and Urban Policy Implications

Department of Geography & Urban Studies, William Paterson University, Wayne, NJ 07470, USA

Received 7 May 2014; Revised 13 August 2014; Accepted 14 August 2014; Published 3 September 2014

Academic Editor: David Wong

Copyright © 2014 Thomas Y. Owusu. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


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.