Why do cities exist? A simple answer is “because people benefit from living close together”—but that just pushes the question further back. In this chapter we look at the very earliest human settlements and watch the first cities appear. They didn’t come from a grand plan. They grew out of a few stubborn problems: how to stay safe, how to trade, and how to cooperate on a scale larger than a family band. The story of Jericho, Çatalhöyük, and Babylonia shows that the economic forces we study in modern cities—public goods, specialization, transaction costs—were already at work ten thousand years ago.