Richard Florida is a co-founder and editor at large of CityLab and a senior editor at The Atlantic. He is a university professor in the University of Toronto’s School of Cities and Rotman School of Management, and a distinguished fellow at New York University’s Schack Institute of Real Estate and visiting fellow at Florida International University.
Sorry, Canada—your entire economy would fit inside Tokyo.
This post is part of a CityLab series on power—the political kind, the stuff inside batteries and gas tanks, and the transformative might of mass movements.
We’ve been talking about power this week at CityLab. Although it’s common to rate and rank the economic power of nations—think of all the articles you’ve read about China catching up with and eventually overtaking the United States in terms of GDP—the real economic power centers of the world economy are cities and metro areas.
To put that into perspective, let’s look at how the economies of the world’s largest metros match up to national economies. We based this comparison on gross domestic product at purchasing power parity, or GDP-PPP. The data for metros is for 2015 and comes from the Brookings Institution’s Redefining Global Cities report, which draws on data from Moody’s Analytics and Oxford Economics; the data for nations is also for 2015 from the World Bank’s World Development Indicators.
The map below, by Taylor Blake of the Martin Prosperity Institute (MPI), tells the story.
Some highlights of the comparison:
- Tokyo, the world’s largest metro economy with $1.6 trillion in GDP-PPP, is just slightly smaller than all of South Korea. Were it a nation, Tokyo would rank as the 15th largest economy in the world.
- New York City’s $1.5 trillion GDP places it among the world’s twenty largest economies, just a tick under those of Spain and Canada.
- Los Angeles’ $928 billion GDP is bit smaller than Australia’s, with $1.1 trillion.
- Seoul ($903 billion) has a bigger economy than Malaysia ($817 billion).
- London’s $831 billion GDP makes its economic activity on par with the Netherlands ($840 billion).
- Paris, with $819 billion in GDP, has a bigger economy than South Africa, $726 billion.
- The $810 billion economy of Shanghai outranks that of the Philippines, with $744 billion.
If you added the ten largest metros together, you’d get a GDP-PPP of $9.5 trillion—bigger than the world’s fourth and fifth largest national economies, Japan and Germany, combined. Take the twenty largest global metros (GDP of $14.6 trillion) and you’re not far from the United States’ $18 trillion dollar economy.
In other words: Cities really are the new power centers of the global economy—the platforms for innovation, entrepreneurship, and economic growth. But when it comes to fiscal and political power, they remain beholden to increasingly anachronistic and backward-looking nation-states, which has become distressingly obvious with the rise of Trumpism in the United States and populism around the world.
The greatest challenge facing us today is how to ensure that global cities have the economic, fiscal, and political power to govern themselves and to continue to be a force for innovation and human progress.