University Communications

Far from growing obsolete as we move into the next century, cities are becoming the engines driving the world economy

By Allen J. Scott

Much has been written in recent years about the prospective obsolescence of cities. New communications technologies, it is often said, will make large-scale urbanization a thing of the past. Yet cities are growing, not shrinking. At least 20 of the world's metropolitan areas have populations of more than 10 million, making them larger than many countries. Almost half of the world's population now lives in urbanized areas. By 2015, the populations of Tokyo, Shanghai, São Paulo, Bombay, Lagos, Jakarta and Karachi are each expected to exceed 20 million.

Rather than fading away as technology improves, big cities — or more precisely, city-regions — have become the motors driving an increasingly integrated global economy. Indeed, as competition in global markets intensifies, national production systems are rapidly mutating into city-centered networks of businesses and associated regional labor-market activity. This fundamental change is in part due to the emergence and growing importance of new, flexible manufacturing and service sectors all over the world. These sectors display a special affinity for the performance-enhancing environment that is found above all in large city-regions. The software industries of San Jose and Bangalore, the financial services of New York, London and Tokyo or the film-producing activities of Hollywood and Hong Kong all take the form of tightly linked, densely concentrated networks characterized by high levels of uncertainty, adaptability, specialization and innovation. As such, these industries stand in stark contrast to large-scale, rigid, assembly-line manufacturing, whose economic difficulties were at the center of the urban crisis of the 1970s.

This shift is also undermining many of the political and social structures that were developed in the past to deal with the interactions between strong central governments, discrete national economies and relatively self-contained national urban systems. The intertwined dynamics of globalization and massive urbanization have created a daunting range of challenges for policy makers on every level — challenges raising fundamental questions that as yet have few satisfactory answers. The consequences could be catastrophic unless we begin to develop some workable solutions to the novel and complex problems now posed by these dynamics.

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