The seven types of global cities driving the world economy.
Globalization and urbanization go hand in hand. The world, I’ve long argued, is spiky. The 40 largest mega-regions produce two-thirds of global economic output and 90 percent of global innovation, while housing just 18 percent of the world’s population.
But we lack solid data on global cities. (My own work uses satellite data on the world at night, which has its own limitations.)
A new report, “Redefining Global Cities,” by the Brookings Institution’s Metropolitan Policy Program fills an important gap here, providing detailed data on the 123 largest global cities based on their metro economies.
The report, released as part of the Global Cities Initiative (a joint project of Brookings and JP Morgan Chase), develops data on economic output, productivity, globalization (via foreign direct investment), innovation (based on patents and venture capital investment), talent (population with tertiary education), and global connectivity (via measures of airline passengers and Internet connectivity).
The report uses these data to create a new typology of the seven types of global cities. The first three are the world’s leading economic power centers.
- Global Giants: These are the world’s leading economic and financial centers, its foremost global cities. They include New York, Los Angeles, London, Paris, Tokyo, and Osaka-Kobe.
- Knowledge Capitals: These are world’s leading knowledge and tech hubs. They include 19 cities centers such as San Jose (the Silicon Valley), Boston, Seattle, San Diego, Washington, D.C., Chicago, Austin, Dallas, Atlanta, Portland, and Denver in the U.S. and Amsterdam, Stockholm, and Zurich in Europe.
- Asian Anchors: These are Asia’s five established and rising economic power centers: Hong Kong, Singapore, Seoul-Incheon, Shanghai, Beijing—and Moscow. Their ability to attract foreign direct investment makes them serious global power players despite having lower levels of economic output than the Global Giants.
In addition to the global economic powerhouses, the report identifies four other types of global cities in the U.S. and around the world which occupy the middle ranks of the world economy. Some are growing in sync with globalization, others are more challenged by it.
- American Middleweights: These are 16 mid-sized U.S. metro areas, including places that are growing via connections to the global economy, including Miami and Rustbelt metros like Cleveland, Detroit, and Pittsburgh, which have up until now have seen their major industries challenged by global competition.
- International Middleweights: This group includes 26 mid-sized metros outside the U.S., including Toronto and Vancouver in Canada; Brussels, Rome, Milan, Berlin, Vienna, Madrid, and Barcelona in Europe; Sydney, Melbourne, and Perth in Australia; and Tel Aviv in the Middle East. Many of these cities are aspiring tech and knowledge hubs and serve as centers for talent, as well.
- Factory China: This set includes 22 second- and third-tier Chinese cities that are manufacturing powerhouses. Even though these metros have experienced rapid growth based on export-intensive manufacturing, they remain relatively poor.
- Emerging Gateways: These are 28 large global business and transportation gateways for major national and regional markets, including Mexico City, Sao Paolo, Rio de Janeiro, Istanbul, Mumbai, and Johannesburg.
Detailing these seven broad types, the report aptly points out “there is no one way to be global city.” Each global city or metro has its own assets that enable it to better compete and prosper in the global economy. The task of economic development is to identify and build on those assets.
Globalization might make us feel small in a growing world, but the lessons of urbanization should remind us how much more powerful we can be when we get connected. Together, these 123 global cities power global competitiveness. They generate a third of global economic output, account for nearly two-thirds of all innovations (based on patents), and represent more than 80 percent of all venture-capital investment in high-tech startups, while housing just 13 percent of the world’s population.
That said, globalization and global urbanization does bring substantial challenges that are rising today more than ever. In a major speech based on the report, Amy Liu, who leads the Brookings Metropolitan Policy Program, noted the challenges and divides that come with such concentrated spikes of global economic activity.
The irony now is that all this energy and progress comes amidst a new environment: growing skepticism about global trade, concerns about immigrants and refugees, and pessimism about a slow-growing world economy… . How can cities deepen their efforts to be globally engaged and competitive while addressing head on the disparities and negative consequences that come with greater global integration?
That’s the question that lies at the heart of our global cities and our collective global future.