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After a decade of experimentation, smart cities are entering a new phase. Although they are only one part of the full tool kit for making a city great, digital solutions are the most powerful and cost-effective additions to that tool kit in many years. This report analyzes dozens of current applications and finds that cities could use them to improve some quality-of-life indicators by 10-30 percent. It also finds that even the most cutting-edge smart cities on the planet are still at the beginning of their journey.

Rotman School of Management professor Ajay Agrawal explains how AI changes the cost of prediction and what this means for business.