Property accounts for a very high share of farming wealth: about 90% in the United States, compared with 20% for households-though a farm is at least a productive asset.

The clustering force makes each of us more productive, which in turns makes the places we inhabit much more productive, generating great increases in output and wealth.

Thus, nations with extensive productive knowledge but relatively little wealth haven't met their potential, and will eventually catch up, Mr. Hausmann said.