GaWC Research Bulletin 353

This Research Bulletin has been published in B. Derudder, M. Hoyler, P.J. Taylor and F. Witlox (eds) (2012) International Handbook of Globalization and World Cities Cheltenham, UK, Northampton, MA, USA: Edward Elgar, pp. 83-93.

Introduction

By the turn of the twenty first century, many of the world's cities were caught up in major economic and social transformation. The 1980s and 90s informational revolution has facilitated global connectivity on an unprecedented scale compared to previous periods of international economic relations. Ongoing developments in information and communications technologies (ICTs) since the mid 1970s are continuing to upgrade the intensity and speed of communications and transactions between cities across the world. Alongside these dramatic changes, the emergence of a distinctive, enlarged, urban functional space has been observed in a number of world locations. This has been described by Allen Scott as a ‘global city-region' (2001a, b) and subsequently by Peter Hall and Kathy Pain (2006) as a global ‘mega-city region'. Both these concepts have attracted major policy attention in Europe, North America and East Asia, where city governments are recognizing that something unprecedented is happening around their major urban concentrations.

Globalizing cities are spilling over their metropolitan boundaries, creating challenges for their planning, management and governance. Manuel Castells has gone so far as to proclaim that these changes are making “the category (“the City”)... theoretically and practically obsolete” (Castells 2007, p.1). Ed Soja has referred to this “transition if not transformation taking place” as “Postmetropolis” (2000 xiii). New theorization can help inform understanding of what is going on, what processes are involved and the practical implications for governance, but empirical research in Western Europe has shown that we need to be careful about using the same theoretical concepts to describe development patterns being witnessed in different places. Apparently similar urban formations in different continents, and even within the same country, may not be outcomes of the same process. Indeed more than one development process may be occurring in one location at the same time (Taylor and Pain 2007). This is an extremely important consideration in addressing policy issues for specific city regions.

The impacts of sweeping techno-economic changes at a global scale are impacting everywhere but have distinctive repercussions at the city region scale. The resurgence of interest in regionalism since the turn of the twenty first century reflects the spiralling concern of nation states around the world for their economic competitiveness in a century which is undoubtedly global (Ward and Jonas 2004). A key challenge for governments and city planners today therefore, is engaging with the drivers of contemporary globalization and understanding their implications for economic growth, stagnation or decline hence there is a need for clarity in the conceptualization of the conditions leading to different emergent city region processes. This paper examines the two key concepts which have been used to describe this new urban scale, the global city-region and the global mega-city region, in order to clarify the specific processes they identify and their relevance for policy. First, the conditions leading to the process of city expansion into globalizing city regions now being witnessed in contemporary globalization are briefly examined.

City expansion in globalization

A good starting point is to consider first what the process of city expansion, is not. Looking back to city-regions as described pre-globalization, Walter Christaller's analysis of Central Places in Southern Germany, in 1933 (Christaller 1966), described very different spatial relations than those being observed today. The industrial revolution had reinforced previous historic international trade, production and consumption patterns but the scale of national social and economic urban relations still pre-dominated. City regions were then seen as having hierarchical relations, with a clear distinction between ‘central places', which were clearly defined urban areas where ‘higher order' activities were located, and the hinterlands they served. Cities were distinct functional, social, and jurisdictional entities. Late twentieth century developments in motorized transportation and virtual communications have made this state-centred and local scale of interaction increasingly irrelevant for understanding urban relations.

Flows of people, information, goods and finance have stretched and intensified between cities, and across national borders and continents (Cochrane and Pain 2000), also transforming city regions. The economic growth of cities is now less tied to their national relations and more to the global scale, described by Peter Taylor as city ‘hinterworld' relations (Taylor 2001a). Cities are increasingly engaged in world-wide systems of economic exchange and financial flows, and this intense global-local interaction gives rise to new functional relations that cross established urban administrative perimeters. Thus, under conditions of contemporary globalization, certain cities have expanded into larger city regions comprising multiple functionally interlinked urban settlements. But confusion arises concerning what functional expansion means in theorizing this new city-region scale.

The process of city expansion was noted long ago, and prior to present city globalizing tendencies, by Jane Jacobs (1969) who saw the external relations of cities, beyond their immediate hinterland, as instrumental in the creation of ‘new work', a complex division of labour producing economic vibrancy (Jacobs, 1969, cited in Taylor et al. 2010, p.7). Given recent heightened concerns for the economic growth of cities in a global context, to what extent does currently observed urban extension represent a new functional scale of economic relations and to what degree are they of a global nature? Janice Perlman and Manuel Castells (2007) for example, have used the term ‘mega-city' to describe the largest contiguous urban areas in the world, irrespective of their overall degree of global economic integration, yet this is now clearly critical in informing local social and economic priorities. Evidence of city expansion to form a functional city region in globalization should relate to integration above the regional scale (for example a regional division of labour).

As analyses by John Friedmann (1986, 1995) and Saskia Sassen (1991, 2000) have demonstrated, specific ‘world' or ‘global' cities have become strategic sites for the operation of the capitalist world economy and its transnational labour market. Their present-day global economic role has been facilitated by recent major technological and economic transition. But, whereas C19th industrialization set many cities in the Western world up as places of relative prosperity and complacency, the late C20th has seen the decline of many once vibrant cities in the new informational economy (Massey 1983). At the same time, cities in liberalizing countries are catching up with hegemonic developed world cities such as New York and London (Derudder et al. 2009). The economic terms of reference for cities everywhere have thus altered substantially and are more dynamic, giving rise to current territorialist concerns for their competitiveness at the global scale. In this context, attention is focusing on what it is that makes very large urban agglomerations globally integrated economically, and how this can be sustained. The answer lies in the drivers behind the economic globalization of cities.

In spite of predictions of the end of geography by authors such as O 'Brien (1992) and Cairncross (1995, 1997a, b), technological developments continue to make cities more important as the locations of global economic activity. As John Kay insisted a decade ago:

ICT-enabled financialization of the world economy has given cities a key role in articulating flows in advanced, knowledge-intensive business and professional services. They are the places where value is added to primary and secondary economic sector production and trade in dispersed trans-continental global production networks (Pain 2008a, 2009) – but is this role conferred on enlarged city regions?

According to Kay, cities remain the focal points for global centralities, first noted by Sassen (1991), that are the outcome of ICT-facilitated economic dispersal because, as strategic locations of the advanced service economy, “in a globalised world of freely moving capital and increasingly moving people, it is only social capital that remains tied to specific places” (Kay 2001, p.14). Twenty years on from Sassen's original analysis, the geography of knowledge-based economic capital is continuing to centre on cities, but cheaper and improved transportation and ICT applications now allow the formation of enlarged, globalizing city hinterlands which, like global cities, are part of a hinterworld space. Potentially, centralities are intensifying to an extent that the global role of some cities is expanding across a proximate urbanized area. This is the spatial dynamic referred to by Scott as a global city-region (Scott, 2001b, p.814) and it is distinct from the physical extension of very large mega-cities which are focal points of social reproduction but are presently disconnected from economic vibrancy associated with global city expansion.

The global city-region

It is therefore important to be clear about exactly what an enlarged city region comprises. For example, the ‘mega-region' recently identified by the Regional Plan Association on the North East coast of the United States will differ in its scale of external economic relations from that of the ‘megalopolis' identified by Jean Gottmann in roughly the same location fifty years ago (Gottmann 1961; Regional Planning Association 2006). Likewise, ‘ mega-city region' functional development identified in the Pearl River Delta and Yangtze River Delta regions of China twenty years ago (Xu and Li, 1990, Hall 1999), prior to the effects from economic liberalization, will differ from that of today. The key distinction between contiguous built urban development, peri-urbanization and urban ‘sprawl', which are marked by local functional connectivities and flows such as daily commuting to work, shopping trips etc., and the global city region phenomenon identified by Scott, is the presence (or not) of active global economic integration across an area larger than Sassen's global city. As Scott has put it: “global city-regions” have become the new scale “ at which globalization processes crystallize out on the geographical landscape” (Scott 2001a, p.7). They are “an outgrowth of large metropolitan areas – or contiguous sets of metropolitan areas – together with surrounding hinterlands of variable extent” (2001b, p.814), furthermore, they constitute “spatial nodes of the global economy' (2001a, p. 11). But, if such city regions are more than large morphological and regionally interconnected entities, what global activities and flows precisely, are they nodes for? To consider this question we need to refer back to key sources for Scott's inspiration, principally John Friedmann, Saskia Sassen and Manuel Castells.

Friedmann's (1986) theorization of the world city drew attention to major cities as command posts of the world economy in which globalizing advanced producer services - financial, legal, advertising, consultancy, etc. - play a key role. Sassen's (1991) concept of the global city extended this thesis, shedding light on the world dispersion of these specialized business services provided to multi-national corporations world-wide, and their simultaneous concentration in global cities. This dual dynamic has led strategic decision-making functions in the most knowledge-intensive organizations in the new world economy to centre on specific cities which have taken on the role of “global service centres” (1991). Scott takes this basic concept and seeks to “extend its range of meaning so as to incorporate the notion of the wider region as an emerging political-economic unit with increasing autonomy of action on the national and world stages” (2001b, p.813). This is because such regions are “dense polarized masses of capital, labour and social life that are bound up in intricate ways in intensifying and far-flung extra-national relationships” (2001b, p.814). Given Jacobs' understanding of urban economic expansion, if true, this should confer the economic dynamism of global cities on physically larger global city-regions.

Scott sees city-region economic dynamism as coming from the role of global cities as “superclusters” for “massive recent expansion” of “leading sectors of capitalism”; these “are organised as dense and intensely localized networks of producers with powerful endogenous growth mechanisms and with an increasingly global market reach” (Scott 2001b, p.820). He refers to the need for businesses to cluster to gain competitive advantage, citing the work of Porter and Storper (Porter 2001, Storper 1997, referred to in Scott 2001b, p.817), and to the “organizational outcomes” of large-scale agglomeration – “rich physical infrastructures supplied out of public funds as cities expand”, “dense local labour markets” and “residential activities”, “consolidation of conventions and cultures” and “above all” their role as “centres for learning, creativity, and innovation... new transactional encounters and experiences” (2001b p.819). His regional vision incorporates the special significance of advanced producer services both in the globalization of cities and in the rise of their surrounding, globalizing regions (for example Cooke and Morgan 1993).

For Scott then, globalization is leading to a “rescaling... in which national domination of social practice is dissipating upwards to the global and downwards to the local” (Scott 2001b, p.183). Furthermore, this makes city regions “active agents in shaping globalization itself” (Scott 2001a, p.11), reflecting Kenichi Ohmae's (1995) ‘ The End of the Nation State' thesis. He reiterates Castells' view that, increasingly, economic exchanges between cities are occurring in a global “space of flows” that is not tied to the “space of places” (regions, and nation states) (Castells 1996, pp.376–428). Yet significantly, he sees global city-regions as the important new “ regional social formations” (Scott, 2001a, p.1).

Rescaling of localized network connections, the development of external urban relations, and the ways in which the latter define and structure city regions, are therefore key determinants of the degree to which global cities are really expanding, functionally. These considerations must inform the question to what extent city regions are simply a new scale of a longstanding process of urbanization and to what extent they are becoming increasingly globally constituted and integrated.

Castells has indicated that the new spatial logic of territorial space, which is increasingly dominated by spaces of flows, may be associated with the formation of “multifunctional, multinuclear spatial structures” (1989, p.167). Sassen has similarly recognised a “reconstitution of the concept of region” (2001, p.5) that is linked into ‘global circuits' (Sassen 2002). These conceptualizations have resonance with Scott's global city-region (Pain 2008b) however important definitional issues remain, as Scott acknowledges (2001b, p.820). For instance: What are the determinants of global economic integration of multinuclear city regions? How should their boundaries be delineated? How fit for purpose are their management and governance structures? These are critically important questions raised by Scott's global city-region thesis.

The mega-city region

Amidst all the speculation about globalizing city regions, the 2003-06 European Union (EU) funded Polynet study has addressed these questions in the most urbanized area of the world, North Western Europe, where historical development has led to densely populated multinuclear present-day city regions (Hall and Pain 2006). Recent enlargement of ‘old Europe' to include newly liberalizing economies of Eastern member states, coupled with EU-wide demographic changes, have made the competitiveness of European city regions in the advanced global service economy a key concern, as expressed in the Lisbon Treaty (http://europa.eu/lisbon_treaty/index_en.htm). However, as Castells (1996) has made us aware, the global economic relations of contemporary cities have become increasingly constructed by connectivities and flows associated with network forms of organization, especially advanced producer services which are associated with centralities in the world economy (Sassen 2000). However, their cross-border network relations cannot be mapped using state-centric official statistics - population, employment, commuting, etc. - as employed in traditional European ‘functional urban region' analysis (Hall and Hay 1980).

Thus the significant innovation of the Polynet study has been the use of network modelling (Taylor 2004) to investigate the cross-border structures of advanced producer service firms operating in Europe, and the functional connectivity they confer on mega-city regions. The unique quantitative results derived from this exercise were supplemented with qualitative data from in-depth interviews with senior personnel working in each region in the service networks surveyed. Four geographical scales of network activity were addressed - regional, national, European and global – in eight regions: South-East England, the Dublin Region Ireland, the Randstad Netherlands, Paris Region, Central Belgium, Northern Switzerland, RhineRuhr and Rhine-Main Germany (Taylor et al. 2008, Pain and Hall 2006a, b, c). Comparative assessment of the results are fully documented in The Polycentric Metropolis (Hall and Pain 2006) and in special editions of Built Environment (32 (2), 2006) and Regional Studies (42 (8), 2008). The results allow new observations to be made about the processes that give rise to globalizing city regions. The two key features of global city relations - rescaling and complexity - prove critical in determining the functional constitution of multinuclear city regions.

What are the Determinants of Global Economic Integration of Multinuclear City Regions?

The first significant observation is that global centralities are focusing on one city in each region studied however spatio-functional differentiation between the city regions is notable. Differences in the degree of advanced producer service network connectivity of the most globally connected city in each region are reflected in different functional structures of the city regions (Taylor and Pain 2007). Cities that are more complex and more strongly integrated in global-scale service networks are conferring complexity on proximate towns and cities which have complementary roles and functions (Pain and Hall 2006). London's superior global connectivity therefore has a counter-intuitive spatial effect. Conventional regional analyses based on space of places statistical data, depict London as a primate city within a mono-centric urban region but the global centralities that are focusing on its densely clustered business milieu, reflecting and reproducing world-wide functional inter-linkages, are also rescaling the relations of the city region.

Functional linkages running through service networks in an extensive area around London are thus producing ‘functional polycentricity' in an enlarged multinuclear urban formation that covers Southern England (Hall and Pain 2006, Pain 2008c) and are evidence of a Jacobs (1984) global city expansion process. This finding adds a new layer to the apparent spatial contradiction associated with the operation of advanced services in globalization. The process of service dispersion and concentration noted by Sassen (1991) now involves the city region scale. Cities that are more interconnected by service networks at a global scale have more complex, functionally polycentric regions. Taylor and Pain (2007) have interpreted this phenomenon as a Jacobs vibrant city-region process that is transforming globalizing mega-city regions (pp.64-65).

How should their Boundaries be Delineated?

A second important observation is that the geographical scale of functionally polycentric mega-city regions is hard to define because relations conferred on cities by service networks are multi-scalar and fluid; they are determined by markets and organisational operations which are cross-border and dynamic. The regions studied by Polynet are constituted by different intersecting scales of network organisation. In some cases, regional and national scales of operation remain predominant and, in these cases, functional polycentricity is less evident. However significantly, in all cases, inter-city relations do not coincide with existing regional administrative and political unit boundaries in North West Europe in spite of EU initiatives to promote a ‘Europe of regions'. This finding concurs with Jacobs' thesis that “city-regions are not defined by natural boundaries, because they are wholly the artefacts of the cities at their nuclei: the boundaries move outward – or halt – only as city economic energy dictates” (1984, p.45). Service networks are flexible structures. They comprise dynamic flows of people and knowledge and they use cities strategically to engage with competitive markets at different scales.

How fit for Purpose are their Management and Governance Structures?

This leads to a third important observation that the structures for contemporary mega-city region management and governance need to be similarly strategic, agile and responsive. They also need to be non-competitive across territorial borders in order to be able to engage with inter-city business structures and flows. The major global service agglomerations of all Polynet regions are inter-linked with proximate towns and cities by regional and national scale service networks but, in contrast to London, other global cities are conferring less global service network integration on a mega-city region scale. Thus Taylor and Pain (2007) refer to two distinct city expansion processes which need to be taken into account in city region strategic planning and management.

London is giving rise to a functionally polycentric mega-city region process on the basis of its exceptionally strong global multi-sector service network connectivity. This connectivity is producing dense, transnational network agglomeration and is also generating complementary global functional inter-linkages with proximate small, multi-sector service clusters. However regions consisting of cities of similar size, are instead exhibiting sectoral specialization between centres which are competing territorially for city users that are predominantly regional or national in network scope; global networks are still centralizing on just one city in these regions. The latter can be interpreted as a continuation of the Sassen (1991) process that produces global city agglomeration economies. Paris is a notable North West Europe exception. Like London, it has very strong multi-sector global service network connectivity but policy interventions have restricted Paris expansion into a functionally polycentric mega-city region (Halbert 2006, Pain and Ardinat 2010c). Paris remains an example of the Sassen (1991) process.

In summary, two different processes can therefore be identified as active in North West European multinuclear mega-city regions: first, the Sassen global city process, and second, its expansion into a Scott (2001) global city-region process. This basic distinction underpins Taylor and Pain's (2007) differentiation between two distinct city region concepts – ‘global mega-city regions' and ‘regions of cities'.

Conclusion

These process-based distinctions should be important in informing policies to promote effective economic growth. Traditional space of places regional analysis has informed what Jacobs (1984) would have regarded as “ process reducing” strategies (for example present EU spatial strategy, dating from 1999 (Pain 2010a)) that are ““transactions of decline”, i.e. “forcible income transfers from productive cities to economically inert regions … through regional redistribution schemes”” (Desrochers and Hospers 2007, p.120).

The complex functional geographies emerging in globalizing city regions bring forth new challenges for policy in the “mosaic” space of places (Castells 1996). Scott sees global city-regions which are “the basic motors of a rapidly globalizing production system” as putting much at stake “as they steadily sharpen their political identities and institutional foundations” (2001b, p.820). He speaks optimistically of “embryonic consolidation of global city-regions into definite political entities... as contiguous local government areas... club together to form spatial coalitions” (p.814), but this is not really happening in the European cases Polynet studied.

Despite a policy illusion of cooperation, neither global mega-city regions nor cities of regions have joined-up strategic systems of governance to support multi-scale development processes (Pain 2010a), illustrating the relevance of the scale recent debate for city regions (for example, Herod and Wright 2002; Marston et al. 2006). The most developed European global mega-city region, South East England, is now facing the greatest challenge for joined up governance of all - management by a mosaic of places under ‘the new localism' (Pain 2010b).

Even so, discourse on “ rescaling the state” to counter fragmented governance (Xu, 2008, Allmendinger 2007) does not address the bigger challenges of managing development processes that flow across multiple extra- regional scales within globalizing mega-city regions. P lanning tools and investment to boost economic growth and counter uneven economic development, require more nuanced, evidence-based conceptual premises, meanwhile, new institutional arrangements require the involvement of the economic network actors (firms) that use and reconstruct cities through their cross-border operational practices (Taylor and Pain 2007, Knox and Pain 2010). Soja (2000 p.4) refers to an “unfolding postmetropolitan transition ” which signifies an emergence of “the expansive metropolis” from “the modern metropolis”. It is this non-dualistic spatial transition of cities in globalization that regional territories must engage with.

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NOTE

^* Kathy Pain, School of Real Estate & Planning, The University of Reading, email: k.pain@reading.ac.uk

Note: This Research Bulletin has been published in B. Derudder, M. Hoyler, P.J. Taylor and F. Witlox (eds) (2012) International Handbook of Globalization and World Cities Cheltenham, UK, Northampton, MA, USA: Edward Elgar, pp. 83-93.