Cities are being reshaped by an increasingly global economy. Virtually all cities are subject to transformation – either because their economies are increasingly integrated with the global economy, or in a dwindling few instances, transformed in different ways because their economies lie outside of it.
Globalization is the economic equivalent of climate change. Yet, unlike climate change, which is making its way into the mainstream of planning, very little attention is paid to what a globalizing economy means for planning cities in the advanced economies.
We can define globalization as increasingly global markets for goods and services, and the relatively free movement of capital and investment, ideas, information and labour around the world.
We can see its imprint today in many of our most pressing urban issues. Globalization has a concentrating effect – capital, wealth, investment, immigration, skills, tend to come together in the largest cities. Canada, for example, is the third-most metropolitan of all OECD countries, after Japan and Korea (meaning it is third in terms of the share of national population found in the biggest urban centres).
While creating opportunities, this also presents challenges – such as intense growth pressures and demand for new infrastructure, housing affordability, neighbourhood polarization, or gentrification pressures in some areas (spawning an anti-gentrification movement in some cities) and disinvestment in others.
The economies of cities and urban regions are being transformed. The Toronto region (the “Greater Golden Horseshoe”), for example, has lost 200,000 manufacturing jobs since 2001. Smaller cities, unless integrated with the global economy in some specific way, such as through resource endowments or specific assets like universities, tend to get left behind. Meanwhile, an explosion of knowledge-intensive activities can be seen in the central areas of the largest cities, such as digital media, computers and information systems, new financial products, medical and scientific research, and education.
We’ve had a certain amount of globalization for several centuries. But that has really accelerated to unprecedented levels since about the 1980s, with trade liberalization (e.g. in Canada, free trade agreements like NAFTA, and those with several Latin American countries) financial market deregulation, and the explosion of new information and communications technologies.
The global economy is made possible by technological advancements. Instantaneous and cheap information flows and communication allow firms to locate different operations in optimal locations across the globe, while maintaining real-time coordination and control. Global markets in finance are underpinned by split second electronic trading in stocks, bonds, currencies, or futures. Electronic capital can be moved around the world with a click.
The twin drivers of globalization and technology are transforming cities in ways not experienced before. This has implications for
- which cities grow and which cities decline
- patterns of growth and decline within cities and urban regions
- urban development patterns and pressures
- shaping key urban issues, such as income polarization or access to housing.
While the global drivers are, by definition, similar for all cities, cities themselves and urban economies are of course not uniform. So these universal drivers will intersect with different cities in different ways, depending on their individual economic landscape and makeup, producing unique results in each case. But all cities are, in their own way, part of the global dynamic, and that is driving profound urban change.
Thus planning issues are so often, and moreso every day, global in origin. Globalization raises key issues for city planners – reshaping the issues we are faced with, as well as our ability to respond. This merits a serious rethink, of our methods, approaches and tools.
So, in an attempt to begin this discussion, a series of posts to follow will describe the top 10 global drivers that are reshaping our cities, and identify some implications for planning.