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Lesson Proper for Week 11

COL003-11- The Global City

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06:23

THE GLOBAL CITY

In realist theory, international affairs are conducted only through the state because the
state is the only legitimate actor in the international system. In the previous lessons, we
have discussed how a state controls the flow of goods, capital, resources, and people
and the regulation of international or cross-border activities within the interstate system.
However, in liberalist theory’s explanation of the process of globalization, the state is no
longer the central actor and is analyzed not as a single unitary actor but as an entity
considered as a national whole composed of subnational parts.
Saskia Sassen (2001) said that subnational actors, such as cities, are considered
important actors with their extensive networks in a highly integrated and interconnected
world. The term global city, which refers to London, Tokyo, and New York, was coined by
Saskia Sassen in her book The Global City. She argues that global cities are “major
nodes” in the interconnected systems of money and information, including the wealth
captured by these cities. They are closely related to specially designed businesses that
enable these flows. These businesses are media firms, financial institutions, law firms,
accounting firms, and consulting firms. Sassen added that these flows are no longer
strictly bound by regulatory systems imposed by the state and not constrained by
national territorial boundaries. The networks and linkages of global cities significantly
affect global affairs in terms of culture, politics, and socioeconomic means. Sassen
argued that given that restriction by states upon the global flow of resources,
information, and people are no longer as stringent as in the past, understanding global
cities, their system, and their global networks require a “new conceptual architecture.”
Sassen proposed the following seven hypotheses regarding the modern global city:
1. The scattering of economic activities that serve as the indicators of globalization
across different areas and the simultaneous integration of activities scattered
across various geographical locations is a key factor feeding the growth and
importance of central corporate functions.
2. These central functions become complex. Hence, the headquarters of large global
firms increasingly outsource them; they buy a share of their central functions from
highly specialized service firms.
3. Agglomeration economies affect specialist service organizations operating in the
most sophisticated and worldwide markets.
4. The more the headquarters outsource their most complex, unstandardized
functions, particularly those subject to uncertain and changing markets, the freer
they opt to choose any location.
5. These specialized service firms need to provide a global service, which results in a
global network of affiliates and strengthens cross-border city-to-city transactions
and networks.
6. These cities' economic fortunes are becoming increasingly separated from their
broader hinterlands, if not their national economies.
7. The expanding informalization of a range of economic activities, which have
effective demand in these locations but have profit rates that prevent them from
competing for various resources with high-profit making enterprises at the top of
the system, is one result of the dynamics stated in hypothesis 6.
(Little, 2013)
CHARACTERISTICS/ATTRIBUTES OF A GLOBAL CITY
Global cities are characterized by specific attributes shared by wealthy and politically
powerful cities all over the world. These characteristics may have slight variations due to
cultural differences, but this is true for all global cities. Various criteria have been
developed to determine what the global city is. The 2012 Global City Index, which was a
global management consulting firm that AT Kearney developed, categorize global cities
according to the following criteria in cooperation with the Chicago Council on Global
Affairs:
1. Business Activity – various businesses and economic activities hosted by a global
city
1. Several multinational company headquarters such as McDonald’s and Starbucks
2. Global services firm or organizations whose primary business model is to offer
intangible value instead of tangible products such as IT firms, educational
institutions, and consulting firms
3. International Financial Institutions such as the World Bank
4. Stock exchange or facilities where traders or brokers can buy and sell securities as
shares of stocks and other financial instruments
5. International conferences
6. Sea and Airports to facilitate the transport of goods and people
 2. Human capital – facilities that could help produce a highly literate and educated
population residing in the city
1. Size of the foreign-born population
2. Quality of universities
3. Number of international schools
4. International student population
5. Number of residents with college degrees
3. Information Exchange – availability of information and communication technologies
and facilities hosted by a city
1. Major TV channels
2. Internet accessibility
3. Number of international news bureaus
4. Censorship
5. Broadband subscriber rate
4. Cultural Experience – events and facilities that enable visitors and residents to
experience the city’s unique culture
1. Museums
2. Sporting events
3. Visual and performing arts venues (e.g., concerts, dance shows, music festivals)
4. Culinary offerings and establishments
5. International travelers
6. Sister city relationships
5. Political Engagements – several establishments and organizations that hold
significant authority and influence in local and global affairs
1. Embassies and consulates
2. Think tanks
3. International organizations such as the United Nations, World Health Organization,
and the World Trade Organization
4. Political conferences and meetings
In the Philippines, we can observe these characteristics in Metro Manila cities, Cebu City,
and Davao City. ASEAN cities such as Kuala Lumpur, Jakarta, Hong Kong, Tokyo, and the
city-state Singapore are the premier examples of global cities that tend to divert wealth
and resources toward their highly educated elites, leaving little for the marginalized who
are not part of this political subdivision.
HOW DO CITIES SERVE AS ENGINES OF GLOBALIZATION?
Cities are the engines of globalization. They are social magnets, growing faster and
faster. In the current generation, urban life has become the dominant form of human life
throughout the world. The problems generated by the present rate of urban growth are
new and cannot be solved based on past lessons. Our historical urban institutions are not
adapting fast enough to the pace of growth. Cities are the
Direct Quote:
“engines of economic growth. This idea has captured the imagination of decision-makers
for decades, from the seminal report Urban Policy and Economic Development: An
Agenda for the 1990s to more recent work by the Commission on Growth and
Development and the Global Commission for the Economy and Climate. Rapid economic
growth is generally associated with urbanization and can be partially attributed to
structural transformation as labor moves from the agricultural sector to industry and
services. It can also be attributed to agglomeration and scale economies as proximity
and density reduce the per capita costs of providing infrastructure and services and
creating knowledge spillovers and specialization that significantly enhance the
productivity of urban residents.
However, neither all cities nor all residents within a given city benefit from urbanization’s
potential economic dividends. One out seven of the world’s population lives in poverty in
urban areas. Even in cities with a high per capita GDP, many urban residents lack access
to basic services and infrastructure, such as safe and accessible drinking water,
sanitation, waste collection, all-weather roads, education, health care, emergency
services, and electricity.” (Colenbrander, 2016)

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