Ranking world cities on the basis of their command-and-control functions and the emerging global economic power-houses

Abstract

Contemporary world city/global city literature relies on two main theories: Friedmann’s world city hypothesis and Sassen’s global city concept. However, there is a major difference between these two approaches, i.e. that the former primarily focuses on the concentration of headquarters of transnational corporations when defining world cities, while according to the latter, global cities are the post-industrial focal points of advanced producer service firms and financial service companies. In recent years, the global city theory has become more widespread. As a result, transnational corporations have lost their significance regarding the designation of leading cities in the global economy. On the other hand, a new tendency has emerged: While international financial markets have been ruled by some global cities (e.g. New York, London, Tokyo, and Paris) for decades, in emerging economies powerful transnational manufacturing corporations, even banks have appeared. This process has led to heavy competition on the global markets, primarily in Africa, Latin America and Asia, between companies of developed countries and emerging economies. Beyond the radar, the manufacturing-oriented world economy has been significantly changing similarly to its global control. Furthermore, the financial crisis of 2007–08 negatively affected many financial actors of the developed world, while large Chinese banks rose to the status of global players.

The process seems obvious: East Asian, especially Chinese cities are occupying an increasingly important role in the command-and-control of the global economy, while many western cities are fading away. Beijing as a command-and-control centre had already appeared among the New York−London−Tokyo−Paris quartet by 2014, and the Chinese capital can be foreseen to take over the leading position in a short time. Shanghai, Shenzhen, Hong Kong, Mumbai, Delhi and other Southeast Asian metropolises have also shown significant strengthening. However, the west-to-east shift of the command-and-control of the global economy is more sophisticated. In the United States, the San Francisco Bay Area has become the home of many leading information technology firms, such as Apple, Facebook, Google and Intel, making this conurbation one of the most important command-and-control centres in the world. Furthermore, while accepting the fact that the command-and-control function of New York has been declining for years now, second tier cities, such as Chicago, Dallas, Houston, San Diego, and Los Angeles, seem to occupy increasingly favourable positions. Japanese cities have not stopped losing positions in East Asia in comparison with China and South Korea, while most cities in the European Union still suffer from the effects of the crisis (except, for example, London, Munich, and Stockholm).

In the first part of the paper, cities are ranked on the basis of their global command-andcontrol function in 2006 and in 2014, while in the second part the emerging powerhouses of the global economy are presented by regions.