Global consolidation

Read in ‘Global City-Regions’ (2001) of Allen Scott (ed.):

One of the students protested. My question on consolidation and which three factors explain this consolidation according to Saskia Sassen in her paper ‘Global Cities and Global City-Regions: a Comparison’, was false according to him. Her consolidation was not spatial, while I suggested it was. Sassen wrote that at the end of 1998 twenty-five cities accounted for 83 percent of the world’s equities under institutional management, that only London, New York and Tokyo accounted for 58 percent of the foreign exchange market and that these three cities, together with Singapore, Hong Kong, Geneva, Frankfurt and Paris accounted for 85 percent in this, the most global of markets. “This trend towards consolidation in a few centers also is evident within countries.” As an illustration she showed that New York is a winner in the US, Sydney in Australia, Toronto in Canada, London in the UK, Bombay in India, Sao Paulo in Brazil, Amsterdam in the Netherlands. So what’s the problem? Not spatial?

The right answer was, of course, very simple if you would have studied the paper carefully. Social connectivity and clustering of central functions in one big city, where information is being exchanged and analyzed by talented, well informed people, is one dominant trend. Another trend is collaboration of cities in cross-border networks, strategic alliances, division of labor, and also competition, all fostering a new urban hierarchy. Sassen: “What we are seeing now is yet a new pattern, where this cooperation or division of functions is somewhat institutionalized: strategic alliances not only between firms across borders but also between markets.” Third, deregulation and privatization lead to denationalization of institutional arenas. Economic globalization, she explains, is making countries less relevant. Agendas en corporate elites are formed in major cities now, not capital cities per se. So the world has changed. “Global cities and global city-regions have emerged as major new scales in this dynamic of territorialization.”  Planners and geographers have to think in a different way. You might say it’s nothing new. Through history cities have always played this role. You’re right. The only thing is, the scale, the intensity, the speed, the impact, we’ve never seen it before.