Cities in the Global Economy.doc

The dispersal capacities emerging with globalization and telematics led many observers to assert that cities would become obsolete. Indeed, many of the once-great industrial centres in the highly developed countries did suffer severe decline. The off-shoring fo factories, the expansion of global networks of affiliates and subsidiaries, the move of back offices to suburbs and out of central cities also left their mark on the more service-centred cities. But against all predictions, a significant number of major cities also saw their concentration of economic power rise. While the decline of industrial centres as a consequence of the internationalization of production beginning in the 1960s has been thoroughly documented and explained, until recently the same could not be said about the rise of major service cities in the 1980s. Today we have a rich new scholarship, replete with debates and disagreements, on cities in a global economy. What explains the new or sharply expanded role of a particular kind of city in the world economy since the early 1980s? It basically results from the intersection of two major processes. One is the sharp growth of the globalization of economic activity, particularly some very specific features of its implementation which have received far less attention than the dispersal aspects. It is a fact that globalization has raised the scale and the complexity of economic transactions, thereby feeding the growth of services for firms, particularly advanced corporate services. The second is the growing service intensity in the organization of the economy, a process evident in firms in all industrial sectors, from mining to finance. The key process from the perspective of the urban economy is the growing demand for services by firms in all industries and the fact that cities are preferred production sites for such services, whether at the global, national or regional level. The growing service intensity in economic organization generally and the specific conditions of production for advanced corporate services, including the conditions under which information technologies are available, combine to make many cities once again key ‘production’ sites, roles they had lost when mass manufacturing became the dominant economic sector. That is to say, the strategic space for mass manufacturing is the large, vertically integrated factory; the city is, at most, the space for administrative activities. If there is another strategic space for mass manufacturing it lies in the realm of government – the site for the execution and legitimation of many of the features of the social contract that is a part of the regime characterized by the dominance of mass manufacturing, especially, but not only, in the highly developed countries. The growing service intensity in the organization of all industries brings with it a newly strategic role for cities as production sites of these necessary service inputs. This holds for cities at many levels of the urban hierarchy, including cities that service sub-national regional economies. In the case of some cities, these servicing functions have global reach; in these cities also, the dominant economic engine tends to be highly specialized service industries. These are the world cities or global cities that are the focus of a new research literature. How many there are, what is their shifting hierarchy, how novel a development do they represent – all are subjects for debate. But there is growing agreement about the fact of a network of major cities cutting across the North/South divide, cities that function as centres for the coordination, control and servicing of global capital. The first section of this chapter examines the key components in the new narrative that has emerged from the research literature on world or global cities. The second reviews the evolution of this literature. In this review I confine myself to a fairly narrowly defined field of scholarship grounded in the notion that the contemporary forms assumed by globalization over the past two decades have specific organizational requirements and political possibilities and that the new technologies produce specific opportunities and capacities. This does not preclude the existence of enormous continuities with past periods – a subject of considerable debate also in this literature – but it does posit the specificity of the current era and hence of the role of cities. The third section examines some of the themes that are emerging as an agenda for research and theory. It is impossible in such a short piece to do full justice to the many scholars who have and are contributing to this new literature. Because of the diversity of variables that can be incorporated – from finance to immigration – the subject of cities in the global economy has contributed not only a research literature in the social sciences but also in recently in certain aspects of political science, notably questions of citize。