Global Cities

In the 1980s, the term globalization entered popular usage to describe the sense that time and space had shrunk, bringing all points on the globe closer together and making them more uniform. Technological advances in telecommunications, electronics, and transportation have made it possible to move information, goods, and people more rapidly than ever before. Today investors can make electronic transfers of funds instantaneously. Communications technologies allow corporations to manage production and distribution of products in many places at once. Businesspeople and tourists can travel to almost anywhere in the world in a matter of hours. Television, computers, and cellular phones allow people in any part of the world to secure information, images, and products from almost anywhere.

The Bund, with commercial buildings in the background, in the global city of Shanghai, China, in August 2002.

Karen Christensen; used with permission.

The new information and transportation technologies converge at key points. A new world system of cities has emerged, with what are called global cities—cities such as New York, London, Tokyo, Chicago, and Hong Kong—at the top. They are called global cities because they act as command centers; they are places where the institutions managing global economic processes are concentrated. Banks, financial and commodities exchanges, and the corporations that coordinate the specialized services connected to global investment decisions tend to cluster together in distinct financial centers that anchor these cities. The professionals who supply related services, such as legal advice, accounting, marketing, advertising, and communications, concentrate in the same locations.

Thus global cities are characterized by an intense concentration of activities at the urban core. The intense activities at the center have revitalized the downtown areas of all global cities. New office towers have sprung up. Tourism and entertainment also flourish, along with the public and private amenities (expensive restaurants, health clubs, and high-end shopping districts) that highly paid professionals demand. One of the consequences of this clustering is that property values are driven to extremely high levels. The professionals who make high salaries bid up housing prices, often displacing people in nearby neighborhoods through the process of gentrification (the movement of “gentry”—the high earners—into a neighborhood). The governments of global cities make large expenditures to keep and attract both professionals and tourists; thus, public priorities stress the construction of airports, convention centers, downtown entertainment and cultural districts, and the like.

Global cities typically have an hourglass economy, that is, one with relatively few middle-class incomes, but with many highly paid workers at the top and even more low-wage workers and unemployed people at the bottom. This phenomenon occurs because the desirable jobs in the global economy require years of education, which leaves those who lack specialized training with few opportunities. The class differences within global cities result in the phenomenon of “divided cities,” with extremes of wealth and poverty expressed spatially in high levels of racial, ethnic, and class segregation. Global cities also attract large number of immigrants, who take many of the service jobs in restaurants, tourism and entertainment, and related services. The rapid changes in the racial and ethnic composition of global cities contribute to concerns about the social fabric.

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