“THE GLOBAL CITY"

SUBMITTED TO ASSOC. PROF. HELGA RITTERSBERGER TILIC

THE GRADUATE SCHOOL OF SOCIAL SCIENCES

OF

MIDDLE EAST TECHNICAL UNIVERSITY

BY

ECEM SECKIN

SOC 510

URBAN THEORY AND POLICY

JANUARY 2015
 TABLE OF CONTENTS

1. INTRODUCTION........................................................................................................1

2. THE GLOBAL CITY FORMATION………………………….……………................1-2

3. URBAN DYNAMICS OF THE GLOBAL CITY………..…...…………......…….......2-4

4. NEW GLOBAL ECONOMIC SYSTEM AND THE GLOBAL CITY………………4-6

5. SOCIAL ISSUES IN THE GLOBAL CITY...............................................................6

6. DEVELOPED AND LESS DEVELOPED COUNTRIES AND GLOBAL CITY…..6-8

7. CONCLUSION.........................................................................................................8

BIBLIOGRAPHY..............................................................................................................9-10

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 1. INTRODUCTION

Global city term begins to be referred with the emergence of global economic system.
It is tried to be defined as an urban center for world economies. Global city is emphasized
with the spatial conjunction of world economic systems of both production and consumption.
This conjunction forms an international network of global cities. In this world wide network
system, Sassen argues that global control capability of city is important because it needs to
control and also to arrange these international economic transactions. Therefore, rise of
internationalization of capital accelerates the formation of global cities. King suggests that in
this process, national companies become multinational and expand their specialized sectors
and services. Then, these transnational companies require place for meeting their production
and consumption needs to sustain their continuity in international arena. So, the required place
for globalized capital is global cities. The growth of international labor market is the final step
for providing the appropriate conditions for the formation of the global city (King, 13-15). It
means new economic order is crucial factor for the emergence of global cities.

2. THE GLOBAL CITY FORMATION

In addition to being control center of capitalist world economy, global cities have
other indicators. For example, having major financial institutions and headquarters of
transnational corporations, developed business-service sector, wide range transportation
network, dense population are some of the indicators of global city as an engine for world
economy. Thus, global city is at the intersection of boundless international economic system
and territorial nation state. In addition, global cities possess highly-paid business people as
service provider class and exporter of these services. Moreover, global cities as consumption
mobilization centers give direction to production. Rise in global competition and profit
maximization race cause decrease in salaries in the global city. This situation causes increase
in immigrant labors. At the same time, the growth of high level service sector causes the
emergence of white collar workers as a separate class. Thus, there is a class polarization in
society lived in the global city. This polarization in the global city also indicates residential
division of urban area based on ethnicity, education and income level. This sharp division
among social classes leads gentrification due to residential demands of high-income people
besides; it also causes expansion of informal and street economy in the global cities (King,
27-29). So, the global city term is not just about being center of the global economy.

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 Furthermore, there is not any stability for being the global city. There is more than one
global city in a country if conditions are appropriate for it but the “globalized” degree of a city
could switch to another city in one country. For instance, the leading global city in Australia
has changed from Melbourne to Sydney. In this shift, cities compete with each other, in other
words they are tried to sell through urban promotions like arranging international art or sport
events in order to create positive perception about the city for investment (Short, 23). In
addition, urban aesthetics and planning is also important to perceive a city as a global city. To
emphasize its suitability for being global city, architecture of the city is important. For
instance, to have extensive transport network in which wide range of subway system or
international airports are indicator of the global city. Agglomeration of skyscrapers is another
symbol of being a global city (Abrahamson, 24). Hence, the appearance and land use planning
of the city is significant to perceive it as a global city.

Sassen argues that the expansion of global economy has long process in which
migrated labors, export and import of goods, privatization and also tourists are influential in
the accumulation of capital especially in the specific cities. Then, with the removal of
boundaries of territorialized nation states is important process for these cities to become
global cities (Sassen, 78). Clark also emphasizes global cities are chosen spaces for
institutions of global capitalism. Therefore, they serve as a place for transnational corporation
and global financial institutions. Size of the city, its historical background, composition and
density of its population and also consistence of national economy with global economy are
other criteria of global cities, other than being a center for world economic system (Clark,
163).

3. URBAN DYNAMICS OF THE GLOBAL CITY

According to Sassen, in order to understand the dynamics of global city, it requires to

focus on the radical growth in global economic transaction, together with high service
intensity in the big firms. The intersection of these processes is located in globalized cities. In
the first dynamic, globalization of economy has expanded both the scale and the complexity
of global activities. Therefore, cities became geographic area for these global economic
transactions. In the second dynamic, the cities transformed the main source to meet the
increased demand for services by companies. Moreover, manufacturing based economic
transactions has been replaced with financial and service activities as a new urban economy in

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the 1980’s. Thus, cities became the major global business center and these business centers
are indispensable part of new urban economy. Because structure of business sectors changed
in terms of size and number of transaction, their occupied spaces in the urban economy also
increased. In addition, with the increase in profit from finance and service sector led to
decrease in manufacturing sector. Both change in size and transaction in business sector
together with rise of finance and service sector as shining star of new urban economy, cities
became the center of capitalist and neoliberal economic systems. Moreover, this
transformation in global economy does not leave space for other smaller sectors to compete
and get profit, so that, many of them replaced with internationalized sector. Therefore, cities
have become integrated into world markets in these transformations (Sassen, 54-55).

Amin and Nigel also suggest that global cities are seen as a control point of world
economic order. They emphasize that global cities are not purposively serve contemporary
capitalism but they create space for this economic system make it visible and useful globally.
It is kind of reciprocal relations between global cities and economic order. So, on the one
hand, economic system also shapes the global city according to its aims. On the other hand,
the global city gives direction to economic system through its urban infrastructure,
institutions, regulations together with educational and housing opportunities and labor
markets. All of these circumstances are provided by the global city and it also generates urban
consumption for constructing a suitable environment to serve for the survival of global
economy in worldwide (Amin & Nigel, 150).

The location of headquarters is also significant to determination of global cities.

However, this criterion is not only indicator of global city term because absence of
headquarters of a firm does not decrease in the status of a city. Especially, manufacturing
companies generally prefer to locate their headquarters in nearest location to their fabrics.
Moreover, specialization of services among different cities in countries and world is also
important in the corporate headquarters issue. For instance, services like banking, accounting,
finance and advertisement locate in New York while Washington, D.C. leads in research and
development, legal and public services (Sassen, 69). Moreover, world cities are controlled by
international capital that means the world city is just a tool for production and expansion of
world economy because it is directly related to city’s capacity to being a safe place for capital
and ensure the continuation of capital flow. This situation is outside of the city’s control, in
other words, the national territories allow the domination of global market economy over

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these cities. Therefore, this is exogenously driven forces as distinct from large urban centers
(Friedmann & Wolff, 310-311). At that point, Sassen prefers to use global city term in order
to determine these cities and also distinguish them from Friedmann’s world cities. She argues
that some of today’s global cities are not world cities. So, Friedmann’s world cities are
dominance center in which multinational corporations are the key agents while Sassen’s
global cities are production centers for service sector to build appropriate environment for
serving global capital (Derudder & De Vos & Witlox, 76).

4. NEW GLOBAL ECONOMIC SYSTEM AND THE GLOBAL CITY

The formation of world cities is intertwined with new global economic system. The
control station of the world economy is global cities and they are integrated into the world
system and also draw capital into themselves to keep ruling power on their hands. Friedmann
and Wolff analyses world cities under the four categories which are economic, social,
physical restructurings and political conflict. In the economic restructuring issue, world cities
have impact on employment structure which influence the composition of the population lived
in these cities. Thus, business services as an economic function of the world cities is
important to transform structure of the society. According to analysis of Friedmann and
Wolff, the first group of employment is high level business services like banking, finance,
accounting, management and legal services and the second group is more varied and mixed
areas of economic sector which includes construction, real estate, restaurants, security, luxury
and hotel services. International tourism as a part of the second group is also directly tied to
capacity to integration of the world cities to global economy. The third group is
manufacturing services whose future does not seem as bright for them especially as compared
with the rise of service sector in the world cities. Another group is government services which
is responsible for the reproduction and also reparation of the world cities through planning
and regulating urban areas. Housing, education, health or transportation services are
conducted by government services in the world cities. In the last groups, there is informal
economy and unemployment population. In the street economy as a part of informal economy,
people work for long hours and get low wages while unemployment population is dependent
on charity and donations to survive. All these economic groups are harbored by world cities.
Thus world cities both an integral part of global economy and control mechanisms of
economic sectors that they have (Friedmann & Wolff, 320-321).

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 In order to understand what defines a global city, it is useful to take a look at the
development of global world economy. The expansion of international economic system is
directly related to formation of global cities. The growth of transnational corporations is
crucial for globalization of the economy. Both the number of firms and the diversity in sectors
increased. Production also increased to maximize profit at the expense of mismatch between
supply and demand. Therefore, in order to meet capital accumulation, the giant business needs
to exceed national controls. Moreover, with the technological developments seen as social
product expansion of global capital increased. Another point is related to changing situation
of sectorial employment. Because more production means more profit in the capitalist world
economy, the mass production needs skilled labor force. International division of labor is
important both for cost of the labor and professionalization. Nevertheless, these processes
cause labor surplus and eventually formation of informal sector. Finally, the mobility of land,
capital and labor is important in the new global world economy. The capital has no
boundaries as compared with labor’s and land’s immobility. Labor has less mobility as
compared with capital because constraints like religion, ethnicity, language or culture affect
the mobility of labor. Land is also immobile but this new world economic order makes
mobility of land less important because it transform cities as center of capital accumulation
(Friedmann & Wolff, 314-316).

From the perspective of Friedmann and Goetz, world system emerged as a global
market economy through international network of cities. This perspective is important
because they wrote their article at the beginning of 1980’s when the world economic system
began to globalize and cities became the part of this new economic system. They basically
suggest that after Second World War, capitalist corporations accelerated their transnational
transactions for their own purposes by exceeding national borders of countries. Thus, this
expansionist strategy of corporations drew cities inside of the global capitalist economy. This
whirlpool of world economic system created urban hierarchies that are world cities promoted
and also controlled expansion of production and market economy worldwide. However,
population size is not the most crucial element to define world cities. At this point, Friedmann
and Goetz suggest two dimensions of world cities to be considered. The first one is the
formation of the city together with the city’s integration capacity. The integration capacity of
city includes serving headquarters of international corporations as a location or serving as a
place for investment in the world economy. The second one is the domination of the world

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economy over cities. This includes the cities’ capability to carry the financial and market
economy that controls the cities, into the world system. Hence, the function of urban roles of
global city and global market economy is unstable (Friedmann & Wolff, 312).

5. SOCIAL ISSUES IN THE GLOBAL CITY

Moreover, global cities are seen as spatial location for economic globalization process.
Therefore, they are both center for production and consumption and also social reproduction
(Smith & Timberlake, 117). For Friedmann and Wolff, this economic restructuring led to a
visible social consequence in the world cities; polarization of classes in the society. The
dominant class in the world cities is transnational elites because the city is designed and
served compatible with their life styles and also they are the most important players who
provide the continuation of global economic activities in the world cities. The world cities
also need under class composed of people who try to prove themselves by working with the
hope for a better life in the world cities. Thus, they attempt to sell their existence on
dominant class in the world cities. They are generally from different ethnicity or immigrant
workers. Therefore, they serve to the world city even sometimes unconsciously. In addition,
the world cities are differentiation from large urban centers generally as being center for
global economic system but social and physical structural features are also important.
Especially, with the migration, the population of the world cities is growing. Urbanized
regions - Friedmann defines them as urban field- is expanding in unbalanced way. This urban
field is economic terms and reflects struggle for survival of the population in the world cities.
This is not the only physical issue of the world cities. The environmental pollution and high
energy consumption are result of over-populated in the world cities (Friedmann & Wolff,
324).

6. DEVELOPED AND LESS DEVELOPED COUNTRIES AND GLOBAL CITY

According to Smith, “All cities become global cities.” because cities in less developed
part of the world like Africa, Southeast Asia and Latin America are connected to the world
economic system through the network of global cities. In the 1980’s, interaction between
urbanization and world economy began to be discussed and at that time, Castell argues that
the transformation of third world cities should be evaluated as “dependent urbanization”.
Because there is various kind of determinants represent historical transformation of the city, it
is difficult to explain global city term with a single economic system. So, the large urban

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centers of underdeveloped countries are seen as weakly connected global economic system.
They are periphery of the world economic system, in other words, although they are part of
the system, their ties with global cities are not strong enough to rise in the ranking of global
urban hierarchy. Hence, the conceptual framework is needed to determine the position and
role of cities in less developed countries by considering their own urban dynamics (Smith, 49-
50).

The global city literature generally focuses on top cities of urban hierarchy and the
lower ones are almost ignored in this hierarchy. Grant and Nijman are critical about
mainstream global city approaches because they think that scholars often ignore to consider
positions of cities in the less developed countries. They argue that the historical background
of global cities have importance related to evolving roles in today’s internationalized
economic system. Therefore, global cities have different statuses in their integration of global
economic order. For instance, London and Bombay have distinct roles being global cities
because from the colonial times, they have different paths. So, in the global city hierarchy,
their rankings are different. As global cities in less developed cities have moved from varied
paths like the pre-colonial, the colonial and the national to reach global phase, economic and
governmental policies of the states in which they are located are crucial. These paths are also
influential in the nature of global city and it influence indirectly the position of the global
cities in the urban hierarchy. Furthermore, in less developed countries, cities play passage
function for internationalized economy before being global city. This function gives rise to
connectivity of the city to the global economy. So, the global connections of the city become
more intensive with the increasing expansion of global economy. Grant and Nijman
emphasize that like global cities in the West, the cities in the less developed countries have
also experienced to keep pace with fast growth of the service and finance sector in global
economy. However, they have also experienced the discrimination among foreign and
domestic ownership of internationalized corporation as a reflection of uncompleted
integration of less developed world in global economic system. Therefore, cities began to
globalize in the less developed countries have different path from global cities in the West
(Grant & Nijman, 225-226).

Hill and Kim also criticize the global city approaches of Sassen and Friedmann in the
issue of the global cities of developmental countries. They claim that globalist viewpoint of
Sassen and Friedmann supposes that there is only one global system for all countries. In

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reality, basic differences in economic basis, spatial and social structure exist in global cities in
developmental countries. So, not all of the global cities follow the same path, it means that the
global city formation is not explained by globalist approach because some of them has not
urban social class polarization, they may have continuing national policies implemented by
their government or they have deep-rooted transnational financial and service corporations
within the national economy. Hill and Kim give examples from East Asian global cities for
these determinations. They have still state-centered economy models rather than market
oriented one, at the same time they have global city status like Tokyo and Seoul. Unlike
London and New York, these cities still have strong and profitable manufacturing sector and
immigrant workers are also tightly controlled by the state. Moreover, these cities become the
control center of their own nations’ transnational corporations rather than being control center
of stateless international corporations. Therefore, these cities have passed through different
path as compared with other global cities in the Western world (Hill & Kim, 171-172).

7. CONCLUSION

In conclusion, global cities have control function for world economy and they are
articulation points of the national economy and the world economy. The basic part of
population in the global city is international elite who specialize in high-quality service. So,
population increases demand for luxury office and housing in the global city. Increase of
services for this cluster of international elite and global economy is observed in the global
cities. Both in residence area and social fields of the global city, there is social class based
divisions related to income level and occupations. They are also important center for
international investments and corporate headquarters together with concentration of the most
powerful media organizations. Therefore, they are at the most important point of international
communication network and they have high frequency of airline connections with other world
cities. There is increase in the top income group and this leads unemployment group and
urban poverty at the same time in the global city. So, all of these features are the urban
dynamics which make a global city different from other large urban centers.

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 BIBLIOGRAPHY

Abrahamson, Mark. Global Cities. New York: Oxford University Press. 2004.

Amin, Ash., Thrift, Nigel. Cultural-economy and Cities, Progress in Human Geography, 31,
2. 2007. 143 – 161.

Clark, David. Urban World/ Global City. New York: Routledge. 2003.

Derudder, Ben., De Vos, Anneleen., Witlox, Frank. “Global City/ World City”. International
Handbook of Globalization and World Cities. Ed. Derudder, Ben., Hoyler, Michael., Taylor,
Peter J., Witlox, Frank. UK: Edward Elgar Publishing. 2012. 73-82.

Grant, Richard., Nijman, Jan. “Globalized and the Corporate Geography of Cities in the Less
Developed World”. The Global Cities Reader. Ed. Brenner, Neil., Keil, Roger. 2002. 224-
237.

Hill, Richard Child., Kim, June Woo. “Global Cities and Developmental States: New York,
Tokyo, Seoul”. The Global Cities Reader. Ed. Brenner, Neil., Keil, Roger. 2002. 170- 178.

Friedmann, John & Wolff, Goetz. World City Formation: An Agenda for Research and
Action. International Journal of Urban and Regional Research, 6. 1982. 309 – 344.

King, Anthony D. Global Cities: Post-Imperialism and the Internationalization of London.

New York: Routledge. 1990.

Sassen, Saskia. “The New Urban Economy: The Intersection of Global Processes and Place”.
Pile (ed), Cities in A World Economy. London and New York: Routledge. 1994. 53 – 76.

Sassen, Saskia, “Global Cities and Global City-Regions: A Comparison”. Global City-
Regions. Ed. Scott, Allen J. New York: Oxford University Press. 2011. 78-96.

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Short, John Rennie. Global Metropolitan: Globalizing Cities in a Capitalist World. UK:
Routledge. 2004.

Smith, David A. “The World Urban Hierarchy: Implications for Cities, Top to Bottom”.
Brown Journal of World Affairs. Volume XI, Issue 2. 2005. 45-55.

Timberlake, Michael., Smith, David. “Hierarchies of Dominance among World Cities: A

Network Approach”. Global Networks: Linked Cities. Ed. Sassen, Saskia. New York:
Routledge. 2002. 117-145.

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