I’m hoping there are not many of you who have even heard of Pokémon, unless you’ve had children that were born in the late 1990s and they brought you into it quietly kicking and screaming in silence. If you’re not aware of what Pokémon is, the franchise started out as a pair of video games for the original Gameboy and published by Nintendo in the late ’90s. In the early to mid-2000s it grew to be the second most successful video game-based media franchise in the world. A few years ago, the franchise waned a bit in popularity. But now it’s making a furious comeback with an augmented reality game called Pokémon Go. It was released last week, and in just a matter of days it’s become the number one most downloaded app on iTunes.
This should help you become more familiar with it:
The last time we saw an increase in the federal gas tax, which feeds the Highway Trust Fund that pays for upgrades and replacements of roads and bridges, was in the ’90s. Now I’m not saying that there’s going to be a revival of infrastructure spending now that Pokémon is making a comeback. I’m saying quite the opposite. Pokémon is the reason why we will not see infrastructure spending staging its own comeback.
The website Vox.com offers the argument that a typical night out at the movies, restaurants, or bowling alleys entails spending a certain amount of money in the local economy. It also points out that you can spend money while playing Pokémon Go, but your money doesn’t circulate around the local economy. Instead, it goes directly into the pockets of the huge global companies that created the game. While there are some good things about that, Vox points out:
And the slower our economic recovery, the slower we’ll see crews working to repair or replace crumbling roads and bridges or any other kind of infrastructure. Damn you, Pokémon Go.But the Pokémon Go economy also has some real downsides. One has to do with regional inequality. Nintendo and its partners are rumored to be earning more than $1 million per day from Pokémon Go. That money is flowing away from small and medium cities, and toward big technology companies concentrated in big cities.
And obviously Pokémon Go isn’t the only example of this. Amazon is doing something similar in the retail industry, diverting business away from local retailers and sucking cash into its corporate headquarters in Seattle. Companies like Google, Facebook, and Vox Media are drawing ad dollars that previously went to local newspapers and television stations.
In contrast, a lot of Internet-based businesses are so ethereal that they barely create any jobs in most markets. Smartphone platforms have created some jobs making apps, but app makers don’t have to live in any particular location. In practice, they tend to be heavily concentrated in the same big cities as most other technology jobs.
The result is that the internet economy is increasingly transforming America into two parallel economies. Cities on the receiving end of Pokémon Go–style money gushers are booming so much that acute housing shortages are causing rents to skyrocket. The rest of the country has seen barely seen an economic recovery at all.
