Scholars of urban law and policy tend to assume that local officials can exert some influence over city well-being. More specifically, the literature assumes that government policies—either at the federal, state, or local level—can influence local economic growth and decline, the most important determinants of a city’s health. This connection between policy and local economic outcomes implies a theory of how cities form and grow, however, and legal scholars have not adequately articulated such a theory. This Article argues that we need a better (and more self-conscious) account of city formation and local economic growth. The Article then tests our intuitions about the relationship between policy and economic development by considering a number of explanations for why cities have resurged over the last fifteen to twenty years. Finally, the Article contrasts two economic development policies that have been adopted in New York City—one that preceded the recent financial crisis and one that followed it. The Article concludes that we do not know enough to be able to predict how one policy or another will affect city growth and decline.