GaWC Project 55

Cities in Economic Expansion and Current Crisis of the Modern World-System

Funded by: The Leverhulme Trust (2007-2010)

Grant Holders: Peter Taylor (Department of Geography), Michael Hoyler (Department of Geography) and Dennis Smith (Department of Social Sciences), Loughborough University
Research Associates: Ann Firth, Oli Mould

[Results]

Introduction: TWO COMPLEMENTARY THEORETICAL CONTEXTS

This project derives from an intellectual conjecture: that the seminal works of Jane Jacobs and Immanuel Wallerstein on the nature of social change, and its implications for future wellbeing, critically complement one another and by marrying their ideas, powerful new insights can be created on the trajectory of our modern world. Although in developing their ideas in writings spanning the last four decades they have hardly cited each other, there are several good reasons for bringing them together at this time:

• both provide materialist accounts of macro-social change making major contributions to the development of the geo-historical sociology that we need to provide strategic understanding of the present-day global (dis)order and possible future world scenarios;
• both support their arguments with detailed empirical studies of a wide range of geographical and historical examples that contribute significantly to understanding long-term globalization processes;
• in both cases, their critical intellectual edge comes from challenging and undermining the priority conventional social science accords to nation-states as actors and arenas;
• both their arguments remain focused upon contemporary macro-social change whose understanding is the raison d'etre for them both;
• and both are extremely pessimistic about the continued reproduction of contemporary society, anticipating an epoch of uncertainty, disorder and conflict.

It is in their respective replacements of the ‘national' geographical scale that they diverge:

• for Wallerstein, understanding social change is sought through study of the modern world-system so that the world-economy replaces national economies as his focus;
• for Jacobs, it is dynamic city-regions that require study in order to understand social change so that in this case the city economy replaces the national economy as focus.

In the context of contemporary globalization, with supra-national economic and political processes gaining in significance and world/global cities becoming more important, the time is ripe to

• recognise that the ideas of Wallerstein and Jacobs complement one another, and
• make a significant effort to marry arguments from these two different social research traditions.

Our intention is to do this through an ambitious empirical study of geo-historical social change, adopting the inductive spirit of both these authors. We also take up their critical spirit in three respects:

1. We are keen, like Wallerstein and Jacobs, to burst out of the straitjacket imposed by ‘statist' thinking.
2. We recognise that each writer's work focuses critical attention upon a hiatus in the work of the other – in Wallerstein's case, a relative neglect of cities and, in Jacobs' case, a failure to see cities within wider social structures.
3. We will test the strengths, limitations and interconnectedness of two metaphors of polity/economy relations that inform the two approaches:
   • in Jacobs's case, the central image is one of ‘energy/creativity release,' whereby political structures deploy themselves in ways that, crucially, do not obstruct the dynamic production of new work by city economies; and
   • in Wallerstein's case, the central image is one of ‘value extraction,' whereby political structures actively create and reinforce global structures of unequal exchange.

Wallerstein's World-Systems Analysis

We broadly accept Wallerstein's (1979) premise that we live in a modern world-system that had taken shape by the end of Braudel's (1982) ‘long sixteenth century', and which was global in scope by about 1900. Historically, this is the only capitalist world-economy to have survived into self-sustaining reproduction. And in achieving this, it has been phenomenally successful: the economic expansion of the modern world-system has been historically unprecedented. This expansion has not been regular through either time or space. Historically, medium and long cycles describe high growth phases followed by low growth/stagnation phases. High growth phases are periods of innovation leading to new and more complex economic processes. The geographical outcome is a core-periphery pattern wherein the core zone is the locale through which economic expansion is generated. Core-making processes create complex economies that are able to organize the rest of the world-system.

For Wallerstein, all world-systems, including the modern world-system are historical not eternal. Thus the salience of his geo-historical sociology to contemporary issues is that we have now entered the demise phase of the modern world-system: an era of fundamental change whose outcomes are deeply uncertain. According to Wallerstein, we have entered a ‘transformational TimeSpace' (Wallerstein 1998, 3). In other words, we are arriving at ‘a structurally chaotic situation that will be both unpleasant to live through and thoroughly unpredictable in its trajectory'. He believes ‘a new order will emerge out of this chaos over a period of fifty years, and this new order will be shaped as a function of what everyone does in the interval – those with power in the present system, and those without it.'

Jacobs' Dynamic Cities

We use Wallerstein's identification of time and space positioning of economic expansion with increased complexity to link his ideas to those of Jacobs. Furthermore, like Wallerstein, Jacobs (2004) foresees uncertain, unpleasant ‘dark ages ahead'. But she comes to this position through a different geo-historical route.

Capitalist expansion has normally been described and explained in terms of the growth of important ‘national economies' at key times and places which then become dominant and impose their influence upon all or parts of the rest of the world-system. In contrast, Jacobs (1970, 1984), has argued that the ‘engines' of this growth are not countries but cities. From this city-centred view of the economic expansion, it is cities that have led half a millennium of massive economic growth in the modern world-system.

Jacobs (1970) begins by distinguishing ‘new work' from ‘old work'. The latter consists of producing more and more of what is already being produced. This repetitive ‘production work' leads to a form of economic growth that does not count as economic expansion. This is because although the economy may become larger, it remains essentially the same in content, structure and complexity. New work, on the other hand, is ‘development work': it creates new divisions of labour that change the content, structure and complexity of an economy as well as growing it.

New work is not ‘spontaneous': it can only derive (spin off) from parent (old) work. Jacobs argues that only in cities are the conditions found to generate new work because this is where the quantity, concentration and diversity of old work are found to act as parent. New work is not market-led, it is market-making. This also makes it dependent on cities for capital, producer goods and services, and suitable labour that are only found in a city. Not all cities at all times are locales of important new work, but when they are generating economic expansion in this way they constitute dynamic cities. Dynamic cities grow in two ways:

1. The export multiplier effect where new work creates new export markets (other cities)
2. The import-replacement multiplier effect where imports are replaced through imitation and improvisation creating new work to supply the city market (replacing suppliers from other cities).

The former produces steady economic expansion; Jacobs shows the latter to create ‘explosive growth': ‘a process of immense, even awesome, economic force' (p. 150). These ‘economic spurts' caused by import-replacement are the prime subject matter of the project.

All spurts come to an end. Sometimes cities, large cities, experience multiple spurts over time; small cities may have had just a single spurt of economic expansion. After a spurt there will be a slow down in growth, stagnation, or even decline in a city's economy. For Jacobs, this is associated with a domination of the city economy that is an obstacle to generation of new work and therefore revitalization of the city. The domination may be based upon economic ‘monopoly' power derived from success in the previous economic spurt, or political power limiting opportunities. The result is the same: a relatively stagnant city that is no longer contributing to economic expansion.

AIMS AND OBJECTIVES

Jacobs combines historical and contemporary case studies with logical reasoning to justify her arguments. The main area where her ideas have been hugely influential is in contemporary economic growth theory; Krugman (1995, 5) calls her ‘a patron saint of the new growth theory'. But the economic spurts of dynamic cities are very special time-space phenomena that are under-researched in historical social science. Thus, Jacobs' ideas have never been systematically assessed over long time and big space dimensions. Here we attempt this for the whole of the modern world-system, challenging Wallerstein's world-systems explanation of economic change that is primarily focused on states and national economies.

This is a pioneering research project that combines a powerful salient theory with empirical geo-historical description and analysis.

Aim 1 : to produce a provisional list of ‘economic spurts' using demographic data as a surrogate measure of economic expansion through:

Objective 1a : to identify a universe of cities to study;
Objective 1b : to compare demographic sources and create appropriate time series data for cities;
Objective 1c : to explore urban growth using different ways of measuring change rates;
Objective 1d : to identify ‘demographic urban spurts' to create the provisional list of economic spurts.

Aim 2 : to investigate the provisional list so as to create a more definitive list of economic spurts through:

Objective 2a : to recognize alternative causes of demographic spurts;
Objective 2b : to eliminate cases of demographic spurts without economic origins and thus produce a definitive list of economic spurts.

Aim 3 : to explore the economic spurts of dynamic cities on a case by case basis. More specifically,

Objective 3a : to identify the economic sector(s) leading the economic expansion (new work);
Objective 3b : to explore the social, political and cultural effects of economic expansion within the dynamic city (social polarization? relative political autonomy? new city-cultural institutions?);
Objective 3c : to trace the network effects of economic expansion on the dynamic city's external relations.

Aim 4 : to test prime arguments of Wallerstein and Jacobs on the geo-history of economic expansion in the modern world-system as follows:

Objective 4a : to compare the density of economic urban spurts to Wallerstein's theses of cyclical patterns of growth and core-periphery patterns of intensive economic expansion in the modern world-system;
Objective 4b : to search for Jacobs' increased complexity of division of labour during economic urban spurts;
Objective 4c : to investigate Jacobs' domination thesis as the reasons why spurts of dynamism come to an end.
Objective 4d : to remain alert to feedback mechanisms from urban governance and politics which impact not only on the urban ‘energy/creative release' dynamics on which Jacobs focuses but also the global ‘value extraction' dynamics analysed by Wallerstein.

Satisfying these aims through meeting the objectives will provide a unique inventory and understanding of the economic expansion of the modern world-system through a theoretically-led and empirically-based project.

MethodologY

This is an ambitious empirical venture that is well sourced in some parts but less well sourced in others. For example demographic data on cities, historical and contemporary, is available in published form; equivalent data on the economics within cities is not so obtainable. Thus very different methods are called for at various stages of the research. The basic strategy is to use the excellent historical and contemporary demographic data to provide an empirical platform from which to explore the economic processes that define dynamic cities.

The Demographic Stage (Aim 1)

Preliminary research has been carried out for objective 1a to indicate the size of the empirical task using Chandler's (1987) city population estimates. Two initial decisions have to be made. First, there is the population size threshold to define possible dynamic cities. We have to use an arbitrary cut-off – the initial choice is 100,000 (this will include Scranton PA, Jacobs' example of a city that enjoyed just one economic spurt). There is an argument to have lower thresholds for earlier periods but, since we are dealing with trends, consistent definition appears to be necessary. Second, there is the question of which dates we define cities above the threshold. We have chosen again an initial arbitrary solution, this time using five century-ends that do happen to broadly mark economic phases of the modern world-system (MWS). Here is the universe of cities:

¹ These are all cities that meet the threshold in and beyond the modern world-system; from 1900 there are no cities beyond.
² The modern world-system (MWS) cities in the first three periods are as follows:
1600 – Paris, Naples, London, Venice, Seville, Prague, Milan, Potosi, Palermo, Rome, Lisbon (plus special case of Antwerp 100,000 between 1665-85)
1700 – London, Paris, Amsterdam, Naples, Lisbon, Venice, Rome, Palermo, Milan, Madrid, Vienna
1800 – London, Constantinople, Paris, Naples, Moscow, Lucknow, Lisbon, Vienna, St Petersburg, Amsterdam, Murshidabad, Cairo, Madrid, Benares, Hyderabad, Berlin, Patna, Dublin, Calcutta, Venice, Rome, Bombay, Delhi, Palermo, Mexico City, Smyrna, Milan, Hamburg, Barcelona, Madras, Lyon, Dacca, Copenhagen.
³ Current UN estimates are used here.

Clearly for 2000, and possibly for 1900, we will have to sample. This will partly be based upon data availability (for later research stages) while keeping an eye on being reasonably representative across the world.

For the other objectives in this aim we will explore and compare different demographic sources (e.g. Chandler 1987, Bairoch et al. 1988, de Vries 1984, Modelski 2003, Russell 1972, Weber 1899, UN 1948-). We need population estimates for intervals up until the century-end in order to identify urban demographic spurts. We infer from Jacobs' case studies that the spurts we are looking for have a minimum period of two decades and a maximum of, perhaps, 50 years. We will explore usage of absolute and relative demographic growth measures. This will control the number of demographic spurts we identify.

The Economic Selection Stage (Aim 2)

Preliminary thinking about objective 2a produces two considerations. First, there are cities in the universe ‘inherited' from other world-systems: either from medieval Europe (all cities in footnote 2 listed for 1600 had populations over 100,000 before 1500 except London, Prague, Potosi and Lisbon) or from subsequent incorporation through geographical expansion of the modern world-system (e.g. Constantinople, Moscow and Delhi in 1700, see footnote 2). These will all be considered after their inclusion as modern world-system cities. Second, and more important, two general alternative causes of demographic urban spurts are identified:

• political privileges – mainly capital cities;
• exogenous factors – war/security, de-ruralization.

Of course, these causes of growth may occur simultaneously with Jacobs' economic spurt process and interact with it in complex ways. To unravel these change factors (objective 2b) we will remain at this general level and use secondary materials (historical and contemporary studies of cities) to identify reasons for demographic spurts. This is extensive library work made feasible by specific time focus on the ‘spurts'; absolutely nothing more is collected at this stage. The intention is to collect data for as many of the ‘1900 and before' cities as possible and then employ a sample (c. 200?) for the 2000 cities.

The Dynamic Cities Stage (Aim 3)

For the objectives at this stage we employ two methods. First, from the previous stage particularly good secondary materials will have been identified that will provide the information to meet objectives for specific cases. Second, where these are not available we will seek out historical and contemporary city scholars who can answer the questions we pose. This use of ‘expert witnesses' (e.g. city planners, local historians) is common in futurist time studies; here we will use a ‘reverse-Delphi' method to marshal selected people's knowledge to meet our objectives. This will be a unique methodological experiment for conducting long time and big space research that focuses on multiple local processes.

The Theory-testing Stage (Aim 4)

For the testing of Wallerstein's geohistorical patterning we will marshal the evidence from previous stages and order it into his time and space categories.

The testing of evidence for Jacobs' dynamic and stagnant cities requires new investigations using a source that will provide information on divisions of labour within cities. To this end we will use nineteenth century trade directories for the 1900 cohort in our universe of cities (Shaw and Coles 1997, Shaw and Tipper 1997, Historical Directories ). We will select city spurts for which there are comparable city directories near the start and end of the spurt. We will experiment with different ways of measuring the complexity of divisions of labour and compare economic complexity at the beginning and end of spurts. We will repeat this exercise to monitor changing complexity for periods of economic stagnation in cities. To test the domination thesis, however, we will have to revert to our previous methodology of consulting secondary sources and local historical experts.

Our fundamental purpose is to describe and explain the expansion and current crisis of the modern world-economy through understanding the part played by ‘dynamic cities' in these processes. We want to explore and understand the extent and manner in which the diversification generated by such cities has propelled the economic success of the modern world-system.

Like both Wallerstein and Jacobs, we are sensitive to feedback mechanisms between political and economic processes. Economic growth and expansion are highly politicised issues, and the politics of dynamic cities are an important factor in explaining the way the modern world-system develops. In choosing our sample of dynamic cities, economic (and demographic) measures and criteria will be used. In describing and explaining the causes and consequences of both their dynamism and, in some cases, their subsequent failure to expand rapidly, we will bring in a range of economic, political, cultural and other factors.

DATA OUTPUT, RESULTS AND DISSEMINATION

We will produce a time-space inventory of economic spurts by dynamic cities across the existence of the modern world-system. We will have generated an understanding of the nature and influences of these local processes across the modern world-system.

The final outcome will be a major monograph on how cities have contributed to the economic expansion of our modern world and how they are involved in the present transformational crisis of the modern world-system.

In preparation towards this book we will generate scholarly dialogues through publishing papers in key urban studies and historical social science journals (e.g. Urban Studies, Journal of Urban History, Journal of Historical Geography, Urban Geography, Social Science History, Comparative Studies in Society and History) and by presentations at key urban and historical conferences (e.g. the Social Science History Association Annual Meeting, the Political Economy of World-Systems (American Sociological Association) Conference, the European Association for Urban History Conference and the European Social Science History Conference).

BIBLIOGRAPHY

Bairoch P (1988) Cities and Economic Development: From the Dawn of History to the Present, London: Mansell

Bairoch, P, Batou, J and Chèvre, P (1988) La population des villes Européenes de 800-1850, Geneva: Libraire Droz

Braudel, F (1982) The Wheels of Commerce, London: Collins

Chandler, T (1987) Four Thousand Years of Urban Growth, Lewiston: Mellen

De Vries, J (1984) European Urbanization, 1500-1800, Cambridge: Cambridge University Press

Historical Directories: Digital Library of Local and Trade Directories for England and Wales, from 1750 to 1919 . University of Leicester, http://www.historicaldirectories.org/

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Jacobs, J (2004) Dark Age Ahead, New York: Random House

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Shaw, G and Coles, T (1997) A Guide to European Town Directories, Vol 1: Germany, Austria, Switzerland and Scandinavia , Aldershot: Ashgate

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