> no good reason to concentrate workers that much

It doesn't and then it dominates.

"Metropolitan areas with a human capital stock one standard deviation below the mean realize no productivity gain, while doubling density in metropolitan areas with a human capital stock one standard deviation above the mean yields productivity benefits that are about twice the average. These patterns are particularly pronounced in industries where the exchange of information and sharing of ideas are important parts of the production process" [1].

[1] https://citeseerx.ist.psu.edu/document?repid=rep1&type=pdf&d...