It appears that there is a lifecycle of urban development, which seems to occur almost independently of the political and cultural systems within which urbanisation takes place. If the lifecycle hypothesis were a valid concept, then the deurbanisation phase should be followed by reurbanisation, a trend which cannot yet be firmly established statistically, although there are some signals in this direction. Besides these waves of urbanisation, concomitant usually with waves of migration, urban dynamics can exhibit very irregular features. This chapter outlines some approaches to this problem. The present contribution is based on the conviction, corroborated by the above mentioned link between urban and economic development, that innovation and technical progress have to be considered as among the more important driving forces in this process. The chapter reports a first attempt to model innovation and economic development, defined as the total volume of goods and services produced in an urban economy.