Rise of The Urban Creative Class in Southeast Asia

THE RISE OF THE
URBAN CREATIVE CLASS

IN SOUTHEAST ASIA
Cities
The Cities Project at the Martin Prosperity Institute focuses on the
role of cities as the key economic and social organizing unit of global
capitalism. It explores both the opportunities and challenges facing
cities as they take on this heightened new role.
The Martin Prosperity Institute, housed at the University of Toronto’s

Rotman School of Management, explores the requisite underpinnings
of a democratic capitalist economy that generate prosperity that is
both robustly growing and broadly experienced.
THE RISE OF THE
URBAN CREATIVE CLASS
IN SOUTHEAST ASIA
Richard Florida
Melanie Fasche
Contents
Executive Summary 6
Introduction9
The Creative Class in Southeast Asia 12

Talent in Southeast Asia 14
Technology in Southeast Asia 17
Tolerance in Southeast Asia 20
The Global Creativity Index in Southeast Asia 24
Creativity and Prosperity in Southeast Asia 26

Economic Output per Person in Southeast Asia 26
Competitiveness in Southeast Asia 28
Entrepreneurship in Southeast Asia 30
Human Development in Southeast Asia 33
Inequality in Southeast Asia 35
Urbanization and Global Cities in Southeast Asia 38

Global Cities in Southeast Asia 42
The Urban Productivity Ratio in Southeast Asia 48
The Global Cities Index in Southeast Asia 50
Conclusion52
Research, Variables, and Data 54
References57
About the Authors 59
4 The Rise of the Urban Creative Class in Southeast Asia

Exhibits
Exhibit 1 Southeast Asian Countries and Cities and their Asian and International Benchmarks 11
Exhibit 2 The Creative Class in Southeast Asia 13
Exhibit 3 Education in Southeast Asia 15
Exhibit 4 The Talent Index in Southeast Asia 16
Exhibit 5 Innovation in Southeast Asia 18
Exhibit 6 The Technology Index in Southeast Asia 19
Exhibit 7 Ethnic and Racial Tolerance in Southeast Asia 21
Exhibit 8 Tolerance toward the Gay and Lesbian Community in Southeast Asia 22
Exhibit 9 The Tolerance Index in Southeast Asia 23
Exhibit 10 The Global Creativity Index in Southeast Asia 25
Exhibit 11 Economic Output per Person in Southeast Asia 27
Exhibit 12 Economic Output per Person and the GCI in Southeast Asia 28
Exhibit 13 Competitiveness in Southeast Asia 29
Exhibit 14 Competitiveness and the GCI in Southeast Asia 30
Exhibit 15 Entrepreneurship in Southeast Asia 31
Exhibit 16 Entrepreneurship and the GCI in Southeast Asia 32
Exhibit 17 Human Development in Southeast Asia 34
Exhibit 18 Human Development and the GCI in Southeast Asia 35
Exhibit 19 Inequality in Southeast Asia 36
Exhibit 20 Inequality and the GCI in Southeast Asia 37
Exhibit 21 Urban Population in Southeast Asia 39
Exhibit 22 Urbanization Level in Southeast Asia 40
Exhibit 23 Economic Output per Person and Urbanization in Southeast Asia 42
Exhibit 24 Population of Global Cities in Southeast Asia 43
Exhibit 25 Metropolitan Economic Output in Southeast Asia 45
Exhibit 26 Metropolitan Share of Total National Economic Output in Southeast Asia 46
Exhibit 27 Metropolitan Economic Output per Person in Southeast Asia 47
Exhibit 28 The Urban Productivity Ratio in Southeast Asia 49
Exhibit 29 Global City Index in Southeast Asia 51

Executive Summary
Southeast Asia is at the center of a significant economic transforma-

tion. The region, which spans Cambodia, Indonesia, Malaysia, the
Philippines, Singapore, Thailand, and Vietnam, is undergoing rapid
growth and urbanization. By 2030, Southeast Asia’s urban population
will swell by an estimated 100 million people, growing from 280
million people today to 373 million people.
This report examines the intersection of urbanization and the rise of

the new creative or middle class in Southeast Asia. In particular, it
assesses the connection between the rise of the creative class and ur-
banization in seven Southeast Asian countries and their major cities.
These include Cambodia (Phnom Penh), Indonesia (Jakarta), Malay-
sia (Kuala Lumpur), the Philippines (Manila), Singapore, Thailand
(Bangkok), and Vietnam (Ho Chi Minh City). We benchmark the
development of these Southeast Asian nations and cities against oth-
ers in Asia — including China (Beijing and Shanghai), Hong Kong,
India (Delhi and Mumbai), Japan (Tokyo), and South Korea (Seoul),
as well as other advanced nations like the Australia (Sydney), Canada
(Toronto), and United States (New York).

Our research informs the following key findings: • Indonesia and Cambodia occupy a fourth tier
of development. While Indonesia’s share of
Southeast Asian nations fall into four tiers of the creative class keeps up with that of Thai-
economic development. land and Vietnam, its performance on the
Global Creativity Index falls back. Cambo-
• Singapore occupies the first tier, ranking dia’s creative class share of four percent of its
third in terms of the share of its population workforce is just half of Indonesia’s. While its
who work in the creative class occupations creative economy development is still nascent,
and ninth on the Global Creativity Index, with per person economic output of $869,
with levels of development and of the creative Cambodia ranks among the world’s “low-in-
class similar to the most advanced nations of come” nations. Just a fifth of Cambodia’s pop-
the world. Singapore generates $51,149 in ulation is urbanized, much lower than other
economic output per person, making it one Southeast Asian nations.
of the richest and most developed nations in
the world — ahead of Canada and the United Urbanization will continue to increase substan-
States. Singapore’s biggest constraint is its rel- tially across the region. By 2030, urban areas in
atively low level of tolerance, especially of the Southeast Asia are projected to grow by anoth-
gay and lesbian community, which may lim- er 100 million, with a total urban population
it its ability to attract and retain talent from of 373 million, putting the region ahead of the
other nations, and compete with the largest United States. By 2030, Malaysia is projected
and most open countries in the world. to have an urban share of more than 80 percent,
• Malaysia and the Philippines occupy a second similar to the current level or urbanization in
tier with economies that are developing rap- Canada and the United States. Indonesia and
idly and a substantial middle class. The cre- Thailand’s urbanization levels are projected to
ative class makes up a quarter of Malaysia’s grow to more than 60 percent. Urbanization is
workforce and a fifth of that of the Philippines, projected to slightly grow in the Philippines to
approaching the levels of advanced nations. 46 percent, while Vietnam is projected to sig-
They rank among the top 50 or so of the nificantly urbanize and cross 40 percent. Cam-
world’s nations both in terms of their share of bodia is expected to grow to roughly a quarter
creative class workers and their performance of the population.
on the Global Creativity Index. Malaysia
has a level of economic output per capita We also examined the size and status of the
($9,748) which places it among the world’s region’s largest cities and metro areas. The re-
“upper-middle income” nations. Roughly gion has two mega-cities with populations big-
three-quarters of its population is urbanized, ger than 10 million: Manila and Jakarta. Four
not far off from that of the United States and others have populations between five and 10
other advanced nations. million: Bangkok, Ho Chi Minh City, Kuala
• Thailand and Vietnam fall into a third tier. Lumpur, and Singapore. By 2030, four cities
The creative class comprises roughly 10 per- in Southeast Asia are projected to have popula-
cent of their workforces. They rank among tions greater than 10 million with Bangkok and
the second half of nations globally both in Ho Chi Minh City joining Manila and Jakarta.
terms of their share of creative class workers Kuala Lumpur will have a population close to
and the Global Creativity Index. 10 million while Singapore will be approaching
seven million.

Southeast Asia’s cities and metros reflect the Ultimately, our research suggests that urban-
region’s tiered development pattern. ization is leading to economic development
across the region and its nations and cities.
Singapore occupies the top tier. It ranks as the That said, the level of economic development
fourth most advanced global city in the world across the region and its cities is highly uneven,
behind only New York, London and Tokyo and mirroring the broader pattern of uneven de-
one of the most prosperous and advanced cit- velopment between the advanced nations and
ies on the planet, ranking just below New York cities of the Global North and the struggling
City with more than $66,000 in economic out- nations and cities of the Global South. The
put per capita, greater than Tokyo, Toronto, region spans Singapore, one of the most afflu-
Seoul and Hong Kong. ent and urbanized places on the planet, and
Cambodia one of the very poorest. While some
Kuala Lumpur occupies a second tier with areas of Southeast Asia are urbanized and de-
economic output per capita of $28,000, con- veloped, others have yet to make this transfor-
siderably greater that either Shanghai or Bei- mation. The question is whether urbanization
jing. With $172 million in total economic can continue to propel economic development
output, it generates more than half of Malaysia’s in the region’s less developed cities and nations
GDP and is a bigger economy than Stuttgart or whether some will fall victim to urbaniza-
or Stockholm. tion without growth.
Bangkok and Manila fall into the third tier, with

economic output per person of roughly $20,000
and $15,000 respectively. Bangkok’s economic
output of more that $300 billion accounts for
more than three quarters of Thailand’s total
GDP, making it a bigger economy than Miami
or Frankfurt. With nearly $200 billion in eco-
nomic output, Manila accounts for nearly two-
thirds of the Philippine’s GDP, and is a consid-
erably bigger economy than Stockholm.
Jakarta and Ho Chi Minh City occupy the

fourth tier with economic output per person of
around $10,000 and $8,700 respectively. With
total economic output of more than $300 bil-
lion, Jakarta’s economy is bigger than Toronto,
while Ho Chi Minh City with $71 billion in out-
put is just slightly smaller than Turin or Oslo.

Introduction
Southeast Asia is at the center of a significant economic transforma-

tion. As its economies expand, its middle and creative classes grow,
and its population moves to cities, the region — which spans Cam-
bodia, Indonesia, Malaysia, the Philippines, Singapore, Thailand, and
Vietnam — is at the center of the world’s third great wave of ur-
banization. The first great wave took place over the nineteenth and
twentieth centuries in the advanced nations of the West, helping to
propel economic development, the growth of a middle class, and ris-
ing living standards. A second wave is currently underway in China.
Today, more than half of the world’s population and knowledge workers who make up the cre-
— 3.9 billion people — live in urban areas and ative class.1 The creative class, which makes up
more than 70 percent of global economic out- between a third to more than 40 percent of the
put comes from cities and urban areas. Each and workforce in advanced nations, spans workers
every week, some 1.4 million people flock to in science and technology; arts, culture, design,
urban areas. By 2030, 65 percent of the world’s media and entertainment; business, finance,
population — almost five billion people — will and management; and the professions of health-
live in cities. By that time, Southeast Asian’s ur- care, education and law. In the United States,
ban population will swell by an estimated 100 where the creative class makes up a third of
million people, growing from 280 million to the workforce, it accounts for half of all wages,
373 million people. Across Asia as a whole, two more than $2 trillion dollars and three-quarters
billion people will be urbanites by 2030, and of all discretionary purchasing power. Across
the region will account for 40 percent of global the world, the creative class is strongly clus-
economic output. The twenty-first century, it tered in urban areas.
seems, will be a distinctly creative, urban, and
Asian century. The future growth of Southeast Asia turns on
two key issues which are at the center of this re-
In the West, urbanization has gone hand in hand port. The first is whether urbanization can con-
with economic development and the rise of an tinue to propel economic development. In the
affluent middle class. But, today’s middle class twentieth century, Western urbanization went
is no longer made up of the blue-collar working hand in hand with economic development and
class. Rather, it is populated by the professional rising living standards. This pattern repeated

itself in China, helping the nation to become a Hong Kong, India (Delhi and Mumbai), Japan
leading world economy. It remains to be seen (Tokyo), South Korea (Seoul), as well as other
whether this path to growth and prosperity will advanced nations like Australia (Sydney), Cana-
hold for Southeast Asia. The second revolves da (Toronto), and the United States (New York).
around the future growth of the new urban Exhibit 1 highlights Southeast Asian nations and
creative middle class. While some Southeast metros that are the focus of our study and the
Asian nations have already developed a sizeable benchmarks to which we compare them.
creative class, in others, such a middle class is
just beginning to emerge. The remainder of this report is structured in
three main parts. The first section examines
This report examines the intersection of urban- how the Southeast Asian nations stack up in
ization and the rise of the new middle class, or terms of the creative class and key indicators of
urban creative class, in Southeast Asia. In par- the “3Ts of economic development” — Talent,
ticular, it assesses the connection between the Technology, and Tolerance. The second section
rise of the creative class and urbanization in looks at the relationship between the creative
seven Southeast Asian countries and their major class and the creative economy and the com-
cities. These include Cambodia (Phnom Penh), petitiveness and prosperity of Southeast Asian
Indonesia (Jakarta), Malaysia (Kuala Lumpur), nations. The third section turns to urbaniza-
the Philippines (Manila), Singapore, Thailand tion and the rise of global cities in Southeast
(Bangkok), and Vietnam (Ho Chi Minh City). Asia. The concluding section summarizes the
We benchmark the development of these South- main findings and their implications for the fu-
east Asian nations and cities against others in ture economic development and rise of an ur-
Asia — including China (Beijing and Shanghai), ban creative class in Southeast Asia.

CANADA
Toronto
UNITED New
STATES York
City
Beijing
Seoul
JAPAN
CHINA
Tokyo
Shanghai
Delhi
SOUTH KOREA
INDIA
HONG KONG
Mumbai VIETNAM
THAILAND
Manila
Bangkok
Ho PHILIPPINES
CAMBODIA
Chi
Phnom Penh Minh
City
MALAYSIA
Kuala Lumpur
SINGAPORE INDONESIA
Jakarta
AUSTRALIA
BENCHMARK SOUTHEAST ASIAN

COUNTRY COUNTRY Sydney
Benchmark City Southeast Asian City
Exhibit 1: Southeast Asian Countries and Cities and their Asian and International Benchmarks

The Creative Class in Southeast Asia
Today, the creative class makes up anywhere from one third to 40

percent of the workforce in advanced nations.2 The creative class
can be thought of as the middle class of the post-industrial economy.
The creative class is paid to think and create, engaging in complex
problem solving that generates new ideas, technology, and products,
whereas the working and service classes apply physical and routine
skills to their work. Nations and cities that are able to attract and
retain the creative class are more competitive.
We measure the creative class based on the Aside from Singapore, Southeast Asian nations
kind of work people do. To do so, we utilize lag behind the West in terms of the develop-
data from the International Labour Organiza- ment of their creative or middle class. Singa-
tion (ILO), identifying occupations spanning pore’s share ranks among the leading nations
computer science and mathematics; architec- in the world. With nearly half (47.3 percent)
ture, engineering; life, physical, and the so- of its workforce in the creative class, Singapore
cial sciences; education, training, and library is third out of 139 countries worldwide, ahead
science; arts and design work, entertainment, of the United States (32.6 percent) and on
sports, and media; and professional and knowl- par with Australia (45.0 percent) and Canada
edge work occupations in management, busi- (43.9 percent). The remaining Southeast Asian
ness and finance, law, sales management, and nations trail far behind. Malaysia is next with
healthcare.3 A creative class level of roughly 30 24.1 percent, 49th in the world followed by the
percent of the workforce indicates the develop- Philippines (21.3 percent, 56th), Thailand (9.9
ment of a large, vibrant, new middle class in the percent, 81st), Vietnam (9.8 percent, 82nd),
postindustrial economy. Indonesia (8.0 percent, 86th), and Cambodia
(4.0 percent, 90th).
Exhibit 2 shows how the Southeast Asian nations
stack up in terms of the share of their work-
force that make up the creative class and com-
pares them to the international benchmarks.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#3 – Singapore 47.3%
#6 – Australia 45.0%
#9 – Canada 43.9%
#24 – Hong Kong 37.2%
#34 – United States 32.6%
#49 – Malaysia 24.1%
#56 – Philippines 21.3%
#64 – Japan 18.7%
#78 – South Korea 12.0%
#81 – Thailand 9.9%
#82 – Vietnam 9.8%
#86 – Indonesia 8.0%
#90 – Cambodia 4.0%
0 10 20 30 40 50%
Creative Class Share
Exhibit 2: The Creative Class in Southeast Asia

Note: Data are not available for China and India
Source: International Labour Organization (ILO), Labour Statistics, 2010 to 2012.

Talent in Southeast Asia The Talent Index in Southeast Asia
Talent or “human capital” is a key driver of eco- The Talent Index in Southeast Asia combines our
nomic development and rising living standards. measures of the creative class and educational
During the 1950s and ’60s, when manufactur- attainment into a single measure (see Exhibit 4).
ing was flourishing in advanced economies, the It is a broad measure of the development of an
thinkers like Peter Drucker and Fritz Malchup educated, knowledge-based middle class.
noted the importance of knowledge workers
in future economic development.4 Paul Romer Here again we can see the substantial differ-
formalized the role of knowledge and tech- ences across Southeast Asian nations. Again
nology in his theory of endogenous growth.5 Singapore is among the leading nations with a
A large body of research has demonstrated the talent score of 0.937, fifth out of 139 countries
close connection between talent and economic worldwide. This is in line with Australia (0.963)
growth at both the regional and national levels.6 and the United States (0.941), and ahead of
Canada (0.889) and Hong Kong (0.767). The
In addition to the creative class, talent can be Philippines (0.552, 65th) and Malaysia (0.522,
measured in terms of education or education- 69th) are nearly on par, followed by Thailand
al attainment. Our measure of educational at- (0.396, 84th), Vietnam (0.233, 104th), Indone-
tainment is one that is commonly employed in sia (0.207, 108th), and Cambodia (0.137, 118th).
cross-national analysis. It is called the “gross ter-
tiary enrollment ratio.” As defined by the World
Bank, tertiary education refers to post-second-
ary institutions such as universities, colleges,
community colleges, and technical training
institutes. The gross tertiary enrollment ratio
measures those involved in tertiary education
compared to the age group spanning five years
after leaving secondary school.7 It is another
indicator of the growth of an educated middle
class. Exhibit 3 lists the shares of gross tertiary
enrollment for the Southeast Asian nations and
their international benchmarks.
Aside from Singapore, gross tertiary enrollment

ratios for Southeast Asian nations lag behind
those in the West. Thailand has a gross tertia-
ry enrollment ratio of 51.3 percent, 46th out
of 139 countries worldwide, a little bit behind
Hong Kong (59.1 percent), but substantially
below Australia (83.1 percent), and the United
States (94.3 percent). The remaining Southeast
Asian nations are much further behind. Malay-
sia is next with a ratio of 36.6 percent (66th),
followed by Indonesia (27.9 percent, 74th) and
Cambodia (15.0 percent, 89th).

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA

#36 – Japan 59.8%
#37 – Hong Kong 59.1%
#46 – Thailand 51.3%
#77 – China 24.8%
#79 – Vietnam 23.8%
#82 – India 22.1%
0 20 40 60 80 100%
Gross Tertiary Enrollment Share
Exhibit 3: Education in Southeast Asia

Note: Education is measured as gross tertiary enrollment. Data are not available for Singapore, the Philippines, and
Canada. The latest figure for Canada is 58.8% for the year 2000.
Source: World Bank, World Development Indicators, Gross Enrollment Ratio, Tertiary, 2010–2012.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#1 – Australia 0.963
#3 – United States 0.941
#5 – Singapore 0.937
#14 – Canada 0.889
#32 – Hong Kong 0.767
#50 – South Korea 0.630
#58 – Japan 0.593
#65 – Philippines 0.552
#69 – Malaysia 0.522
#84 – Thailand 0.396
#87 – China 0.378
#92 – India 0.344
#104 – Vietnam 0.233
#108 – Indonesia 0.207
#118 – Cambodia 0.137
0.000 0.200 0.400 0.600 0.800 1.000

Talent Index
Exhibit 4: The Talent Index in Southeast Asia

Source: International Labour Organization (ILO), Labour Statistics, 2010 to 2012; World Bank, World Development
Indicators, Gross Enrollment Ratio, Tertiary, 2010–2012.

Technology in Southeast Asia
Technology has long been recognized, alongside R&D in Southeast Asia
talent, as a key driver of wealth and progress. R&D investment is a measure of technological
Both Karl Marx and Joseph Schumpeter noted capacity or innovation effort. We use the con-
that advances in technology generate new indus- ventional measure of total R&D expenditure
tries and spur economic growth.8 Technology (including the private and public sectors) as a
development is a good indicator of a nation’s share of economic output or GDP.10 Singapore
overall level of economic development. We uti- again leads the Southeast Asian nations with 2.1
lize two measures of technology: a measure of percent of economic output devoted to R&D,
innovation (patent applications) and of research ranking 13th in the world, slightly higher than
and development (R&D expenditure). Both are Canada (1.8 percent), but significantly lower
from the World Bank’s World Development than the United States (2.8 percent), Japan (3.3
Indicators.9 percent), and South Korea (3.7 percent).
Innovation in Southeast Asia The Technology Index in Southeast Asia

Exhibit 5 shows how the Southeast Asian nations The Technology Index in Southeast Asia com-
and their international benchmarks rank on our bines innovation and R&D investment into
measure of innovation, based on patent applica- a single index. It provides a benchmark for a
tions per million people. country’s overall level of technological develop-
ment. Exhibit 6 shows how the Southeast Asian
Singapore again stands among the world lead- nations stack up on this measure.
ing nations, placing third out of 139 countries
with 1,878 applications per one million people. Singapore again ranks among the world’s lead-
Singapore’s number of patent applications is ers, with a score of 0.933, ranking sixth, com-
higher than in the United States (1,644), Aus- parable to South Korea (0.991), Japan (0.978),
tralia (1,144), and Canada (1,026), and compa- and the United States (0.951). Four Southeast
rable to Hong Kong (1,797), but trails behind Asian nations occupy a middle level. Malaysia is
South Korea (3,606) and Japan (2,691). The next in line with a score of 0.763, 24th world-
rest of Southeast Asia trails substantially be- wide, followed by Thailand (0.612, 38th), Viet-
hind. Malaysia is next in line with 229 patent nam (0.531, 45th), and the Philippines (0.482,
applications per million people (22nd). Thai- 53rd). Indonesia and Cambodia are further
land is next with 63 patent applications per behind with scores of 0.415 (67th) and 0.304
million people (51st) followed by Vietnam with (87th).
42 patent applications per million (64th), the
Philippines with 34 patent applications (72nd),
Indonesia with 24 (81st), and Cambodia with
almost 3 (96th).

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#1 – South Korea 3,606

#2 – Japan 2,691
#3 – Singapore 1,878
#4 – Hong Kong 1,797
#5 – United States 1,644
#7 – Australia 1,144
#8 – Canada 1,026
#11 – China 389
#22 – Malaysia 229
#51 – Thailand 63
#64 – Vietnam 42
#71 – India 34
#72 – Philippines 34
#81 – Indonesia 24
#96 – Cambodia 3
0 1,000 2,000 3,000 4,000

Patent Applications per Million People
Exhibit 5: Innovation in Southeast Asia

Note: Innovation is measured as patent applications per million people
Source: World Bank, World Development Indicators, Patent Applications, 2010 to 2012.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA

#2 – Japan 0.978
#13 – Canada 0.888
#14 – China 0.880
#32 – Hong Kong 0.679
#38 – Thailand 0.612
#45 – Vietnam 0.531
#52 – India 0.491
#87 – Cambodia 0.304
0.000 0.200 0.400 0.600 0.800 1.000

Technology Index
Exhibit 6: The Technology Index in Southeast Asia

Source: World Bank, World Development Indicators, Patent Applications, 2010 to 2012; World Bank, World Develop-
ment Indicators, Research and Development Expenditure, 2010 to 2012.

Tolerance in Southeast Asia
Tolerance is the third T of economic develop- All of the Southeast Asian nations lag on this
ment. It provides the broader context for both measure of tolerance. The Philippines tops the
technological innovation and attracting and list (59 percent, 23rd in the world), far behind
retaining talent. Nations that are open to new- Canada (81 percent), Australia (72 percent), and
comers, immigrants, minorities, and gays and the United States (70 percent). Thailand is next
lesbians signal that their community is open to (27 percent, 54th), followed by Singapore (25
all types of people. A growing body of research percent, 57th), Cambodia (22 percent, 62nd),
shows that openness to diversity can enhance Vietnam (16 percent, 75th) Malaysia (6 percent,
a region’s competitiveness.11 We employ two 104th), and Indonesia (2 percent, 125th).
measures of tolerance: tolerance toward eth-
nic and racial minorities and tolerance toward The Tolerance Index in Southeast Asia
gays and lesbians, both from Gallup’s World The Tolerance Index in Southeast Asia combines
Poll surveys.12 these two measures into a single index. Exhibit 9
lists the Southeast Asian nations and their global
Ethnic and Racial Tolerance benchmarks on this measure.
in Southeast Asia
Exhibit 7 shows the ethnic and racial tolerance The Southeast Asian nations lag behind the
of Southeast Asian nations compared to their world. Singapore tops the list (0.761, 23rd
international benchmarks. It is based on Gal- in the world), considerably behind Canada
lup surveys of the share of people who say that (0.989), Australia (0.945), and the United
their community is a good place for ethnic and States (0.901). The Philippines is next in line
racial minorities. (0.528, 53rd), followed by Vietnam (0.465,
73rd), Cambodia (0.434, 78th), Malaysia (0.313,
Singapore (89.8 percent) tops the list, ranking 100th), Thailand (0.309, 104th), and Indonesia
sixth in the world, ahead of the United States (0.278, 115th).
(82.7 percent), about the same as Australia
(88.3 percent), but behind Canada (90.8 per-
cent). Indonesia is next (72.3 percent, 63rd),
followed by Vietnam (71.8 percent, 66th), Ma-
laysia (68.4 percent, 75th), and Cambodia (64.4
percent, 85th). Closing out the list are the Phil-
ippines (56.1 percent, 102nd) and Thailand
(31.2 percent, 127th).
Tolerance toward the Gay and Lesbian

Community in Southeast Asia
Exhibit 8 shows how the Southeast Asian nations
and their global peers stack up on tolerance to
the gay and lesbian community. Again our mea-
sure is based on Gallup surveys of the share of
people who say that their community is a good
place to live for gay and lesbian people.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#3 – Canada 90.8%
#6 – Singapore 89.7%
#52 – Hong Kong 74.0%
#54 – Japan 73.8%
#66 – Vietnam 71.8%
#90 – China 62.4%
#92 – India 59.8%
#102 – Philippines 56.1%
#127 – Thailand 31.2%
0 20 40 60 80 100%
Ethnic and Racial Tolerance Share
Exhibit 7: Ethnic and Racial Tolerance in Southeast Asia

Note: Ethnic and racial tolerance is measured as the percent of survey respondents reporting that their community is a
good place for racial and ethnic minorities.
Source: Gallup Organization, World Poll, 2014.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#2 – Canada 81%
#8 – Australia 72%
#9 – United States 70%
#23 – Philippines 59%
#26 – Hong Kong 57%
#46 – Japan 34%
#54– Thailand 27%
#57 – Singapore 25%
#62 – Cambodia 22%
#75 – Vietnam 16%
#81 – South Korea 14%
#81 – China 14%
#90 – India 11%
#104 – Malaysia 6%
#125 – Indonesia 2%
0 20 40 60 80 100%
Gay and Lesbian Community Tolerance Share
Exhibit 8: Tolerance toward the Gay and Lesbian Community in Southeast Asia
Note: Tolerance toward the gay and lesbian community is measured as the percent of survey respondents reporting that
their community is a good place to live for gay and lesbian people.
Source: Gallup Organization, World Poll, 2012.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#1 – Canada 0.989
#30 – Hong Kong 0.717
#39 – Japan 0.631
#73 – Vietnam 0.465
#96 – China 0.338
#100 – Malaysia 0.313
#104– Thailand 0.309
#108 – India 0.302
0.000 0.200 0.400 0.600 0.800 1.000

Tolerance Index
Exhibit 9: The Tolerance Index in Southeast Asia

Source: Gallup Organization, World Poll, 2012, 2014.

The Global Creativity Index
in Southeast Asia
Each of the 3Ts is important to broader eco- Second Tier: Malaysia and the Philippines
nomic development and rising living standards. occupy a second tier with rapidly developing
However, a single T alone is not sufficient to economies and a substantial middle class sim-
sustain economic growth and prosperity. An ilar to China. The creative class makes up a
economy needs to perform well on all 3Ts to quarter of Malaysia’s workforce and a fifth of
develop a strong creative economy. The Glob- the Philippines, approaching the levels of ad-
al Creativity Index in Southeast Asia combines vanced nations. They rank among the top fif-
the 3Ts of economic development into a single ty or so of the world’s nations both in terms
index, providing a benchmark for the level of of their creative class and performance on the
overall creative economy development for 139 Global Creativity Index. While the Philippines
nations. Exhibit 10 ranks the Southeast Asian scores almost equally on all 3Ts, Malaysia’s
nations in terms of their overall level of creative biggest constraint, similar to Singapore, is its
economy development. low level of tolerance, especially of the gay and
lesbian community, which will certainly limit
Again, we see the wide variation among South- its ability to attract and retain talent from other
east Asian nations. Singapore ranks among the nations, and keep up with the most open na-
world leaders, with a score of 0.896, ninth out of tions in the world.
139 countries worldwide, ahead of Hong Kong
(0.715) and Japan (0.708), but slightly behind the Third Tier: Thailand and Vietnam fall into a
United States (0.950) and Canada (0.920). The third tier. The creative class comprises roughly
remaining Southeast Asian nations fall further 10 percent of their workforces. They rank among
behind. The Philippines is next (0.487, 52nd) the second half of nations globally both in terms
followed by Malaysia (0.455, 63rd), Vietnam of their creative class and Global Creativity In-
(0.377, 80th), Thailand (0.365, 82nd), Cambo- dex performance, outcompeting India. Thai-
dia (0.213, 113th), and Indonesia (0.202, 115th). land’s biggest constraint to creative economy
development, similar to Singapore and Malaysia,
Ultimately, our analysis of the creative class, is its low level of tolerance, while Vietnam’s big-
each of the 3Ts of economic development, gest constraint is its lower level of talent.
and the overall Creativity Index suggests that
Southeast Asian nations fall into four tiers of Fourth Tier: Indonesia and Cambodia occupy a
economic development and development of fourth tier of development. While Indonesia’s
their middle class. creative class keeps pace with that of Thailand
and Vietnam, the country falls back due to its
First Tier: Singapore occupies the first tier, rank- performance on the Global Creativity Index.
ing third on the creative class and ninth on the Indonesia’s biggest constraint to creative econo-
Global Creativity Index, with levels of economic my development, similar to Singapore, Malaysia,
development and of the creative class similar to and Thailand, is its low level of tolerance. Fi-
the most advanced nations of the world. Singa- nally, Cambodia’s four percent share of creative
pore’s biggest constraint is its relatively low lev- class workers is just half of Indonesia’s, and its
el of tolerance, especially of the gay and lesbian creative economy development is still nascent.
community, which may limit its ability to attract
and retain talent from other nations and com-
pete with the most open nations in the world.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#4 – Canada 0.920
#21 – Hong Kong 0.715
#24 – Japan 0.708
#62 – China 0.462
#80 – Vietnam 0.377
#99 – India 0.292
#113 – Cambodia 0.213
0.000 0.200 0.400 0.600 0.800 1.000

Global Creativity Index
Exhibit 10: The Global Creativity Index in Southeast Asia

Source: Richard Florida, Charlotta Mellander, and Karen M. King, The Global Creativity Index 2015, 2015.

Creativity and Prosperity in Southeast Asia
We now know how the Southeast Asian nations stack up on various

metrics of talent, technology, and tolerance. But how does this effect
their prosperity and economic growth?
To get at this, we compare the performance of these Southeast Asian

countries to other nations of the world on key measures of compet-
itiveness and prosperity. Specifically, we compare their rankings on
the Global Creativity Index (GCI) to five key dimensions of prosper-
ity: economic output per person, economic competitiveness, entre-
preneurship, human development, and inequality.
Economic Output per
Person in Southeast Asia
Economic output per person is a basic mea- of the World Bank’s “lower-middle income”
sure of a nation’s economic development and nations. Cambodia ($869, 116th) is among the
provides a clear indication of the development “low-income” nations.14
of a middle class.13 Again, we see a wide di-
vergence among Southeast Asian nations (see Exhibit 12 shows the relationship between eco-
Exhibit 11). nomic output per person and the GCI.
Singapore leads the region with $51,149 in The fitted line slopes strongly upward, indi-
economic output per person, making it the cating a positive relationship between the two.
10th richest nation in the world — ahead of The correlation between them is 0.65, indi-
Canada ($50,555, 11th) and the United States cating a substantial connection. Singapore is
($49,989, 12th), and slightly lower than Aus- in the upper-right hand corner along with the
tralia ($60,447, 7th). The rest of the Southeast United States, Canada, and Japan. Malaysia,
Asian nations trail substantially behind. Malay- Thailand, and the Philippines are clustered to-
sia ($9,748, 53rd) and Thailand ($5,158, 75th) ward the middle of the graph alongside China.
have levels of economic output per person, Indonesia and Cambodia are toward the low-
which places them among what the World Bank er left-hand corner, indicating a lower level of
calls “upper-middle income” nations. Indonesia development. Singapore, Malaysia, Thailand,
($3,323, 88th), the Philippines ($2,360, 96th), and Indonesia are above the fitted line, indi-
and Vietnam ($1,544, 101st) occupy the ranks cating a higher level of economic output per

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#7 – Australia $60,447
#10 – Singapore $51,149
#11 – Canada $50,555
#12 – United States $49,989
#18 – Japan $45,290
#26 – Hong Kong $34,800
#31 – South Korea $23,587
#53 – Malaysia $9,748
#73 – China $5,325
#75– Thailand $5,158
#88 – Indonesia $3,323
#96 – Philippines $2,360
#101 – Vietnam $1,544
#103 – India $1,487
#116 – Cambodia $869
0 25,000 50,000 $75,000

Economic Output per Person
Exhibit 11: Economic Output per Person in Southeast Asia

Source: World Bank, World Development Indicators, GDP Per Capita, 2010–2012.

person than their GCI scores would predict, their international peers stack up on economic
while the Philippines, Vietnam, and Cambodia competitiveness.
are below the line, suggesting a lower level
of economic output per person than their GCI Singapore tops the list with a global compet-
scores would predict. itiveness score of 5.65, ranking second in the
world ahead of the United States (5.54, third),
Competitiveness in Southeast Asia Japan (5.47, sixth), and Hong Kong (5.46, sev-
Competitiveness is a key indicator of the qual- enth). Malaysia (5.16, 20th) also does well with
ity of institutions, policies, and other factors a competitiveness score comparable to Cana-
that determine a country’s productivity and da (5.24, 15th) and ahead of Australia (5.08,
economic output. More competitive nations 22nd), South Korea (4.96, 26th), and China
are likely to increase their productivity and (4.89, 28th). Thailand (4.66, 31st), Indone-
economic output over time. Our measure of sia (4.57, 34th), the Philippines (4.40, 52nd),
competitiveness is based on the Global Com- and Vietnam (4.23, 68th) have lower compet-
petitiveness Index, developed by Harvard itiveness scores, roughly comparable to India
University economist Michael Porter.15 Exhibit (4.21, 71st). Cambodia takes last place among
13 shows how the Southeast Asian nations and Southeast Asian nations with a score of 3.89
12.0
Australia
Singapore
Japan United States
Hong Kong Canada
South Korea
Economic Output per Person*
10.0
Malaysia
Thailand
Indonesia China
8.0
Philippines
Vietnam
India
Cambodia
6.0
4.0
0.000 0.200 0.400 0.600 0.800 1.000
Exhibit 12: Economic Output per Person and the GCI in Southeast Asia
Note: *Logged.
Source: The GCI is from The Global Creativity Index 2015, 2015; Economic output per person is from the World Bank,
World Development Indicators, GDP Per Capita, 2010–2012.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#6 – Japan 5.47
#7 – Hong Kong 5.46
#15 – Canada 5.24
#28 – China 4.89
#68 – Vietnam 4.23
#71 – India 4.21
0.00 1.00 2.00 3.00 4.00 5.00 6.00

Global Competitiveness Index
Exhibit 13: Competitiveness in Southeast Asia

Source: World Economic Forum, Global Competitiveness Report 2014–2015, 2015.

and ranks 95th, comparable to Namibia, Serbia, Entrepreneurship in Southeast Asia
and Mongolia. Entrepreneurship is a critical factor in innova-
tion and economic growth. In advanced coun-
Exhibit 14 shows the relationship between com- tries like the United States, start-up companies
petitiveness and the GCI. At 0.78, the cor- have played a vital role in generating new in-
relation between the two is substantial. Again, dustries like semiconductors, personal comput-
Singapore is in the far upper right-hand corner ers, mobile phones, biotech, and social media
alongside the United States and other advanced that power economic development. In emerg-
nations. Malaysia, the Philippines, and Thailand ing countries like those of Southeast Asia, en-
are in the middle of the chart, similar to China. trepreneurship can help generate economic
Indonesia, Vietnam, and Cambodia are further development and the development of a broad-
down. All of the Southeast Asian nations — er middle class. We measure entrepreneurship
Cambodia, Indonesia, Malaysia, the Philippines, via the Global Entrepreneurship Index, a broad
Singapore, Thailand, and Vietnam — are situ- measure of entrepreneurial activity across
ated above the fitted line, indicating that they 130 countries.16 Exhibit 15 ranks the Southeast
have a higher level of competitiveness than their Asian nations and their international peers on
GCI scores would predict. this metric.
6.0
Singapore
Japan United States
Hong Kong
Malaysia
Global Competitiveness Index
Canada Australia
5.0 South Korea
China
Thailand
Indonesia
India Philippines
Vietnam
4.0
Cambodia
3.0
2.0
0.000 0.200 0.400 0.600 0.800 1.000
Exhibit 14: Competitiveness and the GCI in Southeast Asia

Source: The GCI is from The Global Creativity Index 2015, 2015; Economic competitiveness is from the World Economic
Forum, Global Competitiveness Report 2014–2015, 2015.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA

#2 – Canada 81.5
#33 – Japan 49.5
#40 – Hong Kong 45.9
#61 – China 36.4
#85 – Vietnam 28.8
#104 – India 25.3
0.0 20.0 40.0 60.0 80.0 100.0

Global Entrepreneurship Index
Exhibit 15: Entrepreneurship in Southeast Asia

Source: Zoltán Ács, László Szerb, and Erkko Autio, 2015 Global Entrepreneurship Index, The Global Entrepreneurship
and Development Institute, 2015.

100.0
United States
80.0 Canada Australia

Global Entrepreneurship Index
Singapore
60.0
South Korea
Japan
Hong Kong
40.0 Malaysia
China
Thailand
Cambodia Philippines
Vietnam
20.0 Indonesia India
0.0
0.000 0.200 0.400 0.600 0.800 1.000
Exhibit 16: Entrepreneurship and the GCI in Southeast Asia

Source: The GCI is from The Global Creativity Index 2015, 2015; The global entrepreneurship ranking is from Zoltán
Ács, László Szerb, and Erkko Autio, 2015 Global Entrepreneurship Index, The Global Entrepreneurship and Develop-
ment Institute, 2015.
Singapore (68.1, 10th) has the highest entrepre- association. Singapore is in the upper right-
neurship rating ranking, ahead of Asian peers hand corner, but this time just slightly below
like Hong Kong (45.9, 40th), Japan (49.5, 33rd), the United States and other advanced nations.
and South Korea (54.1, 28th), but behind leading Malaysia, Thailand, the Philippines, and Viet-
advanced nations like the United States (85.0), nam occupy a middle position, somewhat close
Canada (81.5), and Australia (77.6) who occu- to China, while Cambodia and Indonesia are
further down. Singapore, Thailand, and Cam-
py the top three spots. Malaysia is a fairly distant
second (40.0, 53rd) ahead of China (36.4, 61st). bodia are roughly on the fitted line indicating
Thailand is next (32.1, 68th) followed by Viet- that their levels of entrepreneurship are more
nam (28.8, 85th), the Philippines (27.7, 95th), or less in line with what their GCI scores would
and Cambodia (26.3, 98th), and behind India predict. Malaysia is above the fitted line, indi-
(25.3, 104th) and Indonesia (21.0, 120th). cating a higher level of entrepreneurship than
its GCI score would predict, while Vietnam
Exhibit 16 shows the relationship between en- and Indonesia are below it, indicating a lower
trepreneurship and the GCI. The correlation level of entrepreneurship than their GCI scores
between the two is 0.83, indicating a very close would suggest.

Human Development in Southeast Asia
Human development — the overall advance-
ment of people through education, living stan-
dards, and length of life — is a key factor in
determining the wealth of nations. To measure
it, we utilize the United Nations Development
Program (UNDP)’s Human Development In-
dex (HDI), which takes into account the ability
to live a long and healthy life, the acquisition
of knowledge, and the ability to have a decent
standard of living. The HDI is measured annu-
ally on a scale between 0 and 1.0, with higher
scores indicating higher levels of human devel-
opment.17 Exhibit 17 arrays Southeast Asian na-
tions and the global benchmarks on this metric.
Singapore tops the list among Southeast Asian

nations with an HDI of 0.901 and ranks within
the top 10, almost on par with Canada (0.902,
eighth) but behind Australia (0.933, second)
and the United States (0.914, fifth). It is fol-
lowed by Malaysia (0.773, 62nd) and Thailand
(0.722, 89th), and ahead of China (0.719, 91st),
all of which the UNDP classifies as countries
with “high human development.” Indonesia
(0.684, 108th), the Philippines (0.660, 117th),
and Vietnam (0.638, 121st) are ahead of India
(0.586, 135th), and followed by Cambodia
(0.584, 136th), which are all classified as coun-
tries with “medium human development.”
Exhibit 18 shows the relationship between hu-

man development and the GCI. The correlation
between the two is 0.78, indicating a close rela-
tionship. Malaysia, Thailand, and Indonesia are
situated well above the fitted line, indicating
that their human development is higher than
the GCI would predict. This potentially reflects
their move up the value chain of manufacturing.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
Australia
#2 – 0.933
#8 – Canada 0.902
#15 – Hong Kong 0.891
#17 – Japan 0.890
#91 – China 0.719
#121 – Vietnam 0.638
#135 – India 0.586
#136 – Cambodia 0.584
0.000 0.200 0.400 0.600 0.800 1.000

Human Development Index
Exhibit 17: Human Development in Southeast Asia

Source: United Nations Development Program (UNDP), Human Development Report 2014. Sustaining Human Progress:
Reducing Vulnerabilities and Building Resilience, New York, 2014.

1.00
Australia
United States
Hong Kong
South Korea
Japan Singapore Canada
0.80
Human Development Index
Malaysia
Thailand
China
Indonesia
Vietnam Philippines
0.60
Cambodia India
0.40
0.20
0.000 0.200 0.400 0.600 0.800 1.000
Exhibit 18: Human Development and the GCI in Southeast Asia

Source: The GCI is from The Global Creativity Index 2015, 2015; The Human Development Index is from the United
Nations Development Program, Human Development Report 2014. Sustaining Human Progress: Reducing Vulnerabilities
and Building Resilience, New York, 2014.
Inequality in Southeast Asia

Inequality — the economic gap between the the world, comparable to Hong Kong (0.537,
rich and the poor — has surged across the world. 10th). Malaysia (0.434, 33rd), the Philippines
We measure it based on the Gini coefficient, the (0.434, 34th), and Thailand (0.407, 49th)
conventional metric for income inequality. It is also have high levels of inequality, comparable
measured on a 0 to 1 scale where higher values to China (0.424, 41st) and the United States
indicate higher levels of inequality.18 Exhibit 19 (0.411, 44th). Vietnam (0.366, 64th), Cambo-
shows levels of inequality for Southeast Asian dia (0.353, 76th), and Indonesia (0.346, 82nd)
nations and their global benchmarks. have lower levels of inequality, and are com-
parable to Australia (0.349, 79th) and Canada
Singapore (0.464, 25th) has the highest level (0.338, 87th), but higher than India (0.336,
of inequality in Southeast Asia and one of the 89th), Japan (0.321, 110th), and South Korea
highest levels among the advanced nations in (0.302, 111th).

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
#10 – Hong Kong 0.537

#41 – China 0.424
#64 – Vietnam 0.366
#87 – Canada 0.338
#89 – India 0.336
#100 – Japan 0.321
0.0 0.1 0.2 0.3 0.4 0.5 0.6

Inequality
Exhibit 19: Inequality in Southeast Asia

Source: World Bank, World Development Indicators, Gini Index, 2004–2013; Central Intelligence Agency (CIA),
The World Factbook, Distribution of Family Income — Gini Index, 2011–2014.

70.0
60.0
Hong Kong
50.0
Malaysia Singapore
Inequality
Philippines
Thailand China United States
40.0
Cambodia Australia
India Vietnam
Indonesia
Japan Canada
30.0 South Korea
20.0
10.0
0.000 0.200 0.400 0.600 0.800 1.000
Exhibit 20: Inequality and the GCI in Southeast Asia

Source: The GCI is from The Global Creativity Index 2015, 2015; Inequality based on the Gini coefficient is from the
World Bank, World Development Indicators, Gini Index, 2004–2013 and The CIA World Factbook, Distribution of
Family Income — Gini Index, 2011–2014.
Exhibit 20 shows the relationship between in- uated above the fitted line, indicating that their
equality and the GCI. Here, the line slopes levels of inequality are higher than their GCI
more gently and downward to the right, indi- scores would predict. These countries can be
cating a negative association between the two. said to have a low-road path to inequality and
The correlation is -0.25, indicating a modest economic development, similar to that of the
negative relationship between inequality and United States, where higher levels of creative
the GCI. In other words, more developed na- economic development go along with higher
tions that score higher on the GCI, are over- levels of inequality. Vietnam, Cambodia, and
all more equal. Singapore is on the far right Indonesia are situated below the fitted line, in-
hand side of the graph, near Hong Kong and dicating that their level of inequality is lower
above the United States and other advanced than their GCI score would predict. This is in
nations. The Philippines, Malaysia, Vietnam, line with the high-road path taken by Scandina-
and Thailand occupy a more middle position via and Northern European nations as well as
similar to China, with Cambodia and Indone- Japan and South Korea, where higher levels of
sia further down, similar to India. Singapore, creative economic development go along with
Malaysia, the Philippines, and Thailand are sit- lower levels of inequality.

Urbanization and Global Cities in Southeast Asia
Urbanization, economic development, and the rise of the middle class

have historically gone hand in hand. As the nations of the West urban-
ized during the nineteenth and twentieth centuries, their economies
developed and their urban middle classes grew.
Up until now, the world has gone through two great waves of urban-
ization. The first occurred in the West, and the second is the more
recent urbanization of China. Southeast Asia promises to be the third
great wave of urbanization. The region’s urban population has grown
from 82 million in 1980 to 280 million people in 2015 and is project-
ed to increase to 373 million by 2030. Southeast Asia’s 280 million
urbanites are comparable to that of the United States, who the region
is projected to overtake in the next decade and a half.19
Urban Population in Southeast Asia Urbanization Levels in Southeast Asia

Exhibit 21 shows the growth of the urban popu- Next we look at the share of the population that
lives in urban areas, the so-called urbanization
lation in Southeast Asian nations and their global
benchmarks in 1980, 2015, and projected out rate.20 Urbanization is a key factor in the rise
to 2030. of a middle class, with higher rates of urbaniza-
tion typically signalling a larger urban middle
With 137.4 million urban residents, Indonesia class. Exhibit 22 shows how the Southeast Asian
accounts for almost half (49 percent) of South- countries and their global benchmarks stack up
east Asia’s urban population. It is followed by in terms of their urbanization rates, or share
the Philippines (45.2 million), Thailand (34.0 of population that is urban, in 1980, 2015, and
million), and Vietnam (31.4 million, about the projected out to 2030.
same as Canada), Malaysia (22.9 million, about
the same as Australia), Singapore (5.6 million),
and Cambodia (3.2 million).

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
China 779.5
India 419.9
United States 265.4
Indonesia 137.4
Japan 118.6
Philippines 45.2
South Korea 41.0
Thailand 34.0 2015 Population
(Figure in millions)
Vietnam 31.4
Canada 29.4 310.1
Malaysia 22.9 1980 2030

Population Population
Australia 21.4 (Projection)
Hong Kong 7.3
Singapore 5.6
Cambodia 3.2
0 200 400 600 800 1,000

Population (millions)
Exhibit 21: Urban Population in Southeast Asia

Source: United Nations, World Urbanization Prospects, 2014 revision, Urban Population at Mid-Year by Major Area,
Region and Country, 1950–2050, 2014.

VIETNAM
THAILAND
PHILIPPINES
CAMBODIA
SINGAPORE
MALAYSIA
INDONESIA
Singapore 100.0%
Hong Kong 100.0%
Japan 93.5%
Australia 89.4%
South Korea 82.5%
Canada 81.8%
United States 81.6%
Malaysia 74.7% 2015 Level
(Percent)
China 55.6%
Indonesia 53.7% 80.1%
Thailand 50.4% 1980 2030

Level Level
Philippines 44.4% (Projection)
Vietnam 33.6%
India 32.7%
Cambodia 20.7%
0 20 40 60 80 100%
Urbanization Level
Exhibit 22: Urbanization Level in Southeast Asia

Source: United Nations, World Urbanization Prospects, 2014 revision, Percentage of Population at Mid-Year Residing in
Major Area, Region and Country, 1950–2050, 2014.

Topping the list is Singapore where 100 per- Exhibit 23 shows the association between urban-
cent of the population is urbanized. The city- ization and economic output per person.22 The
state is ahead of Japan (93.5 percent), Australia fitted line slopes upward, indicating a positive
(89.4 percent), Canada (81.8 percent), and the relationship between the two, and the correla-
United States (81.6 percent). Malaysia, where tion is 0.82, indicating a substantial association
three-quarters of the population is urbanized, between urbanization and economic output per
is next, not far off that of the United States and person. Singapore is in the upper right hand
other advanced nations. About half the popu- corner, alongside the United States and other
lation is urbanized in Indonesia and Thailand, advanced nations, followed by Malaysia. Thai-
and 44 percent of the population in the Phil- land, Indonesia, and the Philippines are toward
ippines is urbanized. A third of the population the middle of the graph, similar to China, with
of Vietnam is urbanized while just a fifth of the Vietnam and Cambodia lower down toward
population is in Cambodia. the bottom left. Singapore and Malaysia are
located below the fitted line, indicating that
These urbanization rates are projected to grow their levels of urbanization are slightly higher
considerably by 2030. By that time, Malaysia is than their levels of economic output per person
projected to have an urban share of more than would predict. The Philippines and Indonesia
80 percent — similar to the current level of are located on the line. Thailand, Vietnam, and
urbanization in Canada and the United States. Cambodia are located above the line, indicating
Indonesia and Thailand’s urbanization levels are that their levels of urbanization are a bit less
projected to grow to more than 60 percent, not than their level of economic output per person
far behind that of China (68.7 percent). Urban- would predict.
ization is projected to slightly grow in the Phil-
ippines to 46 percent, while Vietnam is project-
ed to significantly urbanize and cross 40 percent
while urbanization in Cambodia is expected to
grow to roughly a quarter of the population.
Urbanization and Economic

Development in Southeast Asia
Urbanization is a factor in economic devel-
opment and the development of a large mid-
dle class. In the advanced nations, both have
occurred in tandem over the past century or
so. But economists worry that this historical
relationship may be weakening. We may be
entering a new phase of development where
urbanization is not necessarily associated with
higher levels of economic growth and a rising
middle class. This has been referred to as “ur-
banization without growth.”21

12.0
Australia
Canada Singapore
United States
Japan
Economic Output per Person*
Hong Kong
10.0
South Korea
Malaysia
China
Thailand
8.0 Indonesia
Philippines
Vietnam
India
Cambodia
6.0
4.0
0 20 40 60 80 100%
Urbanization Level
*Logged
Exhibit 23: Economic Output per Person and Urbanization in Southeast Asia
Note: *Logged.
Source: Economic output per person is from the World Bank, World Development Indicators, GDP Per Capita, 2010–
2012, and urbanization is from the World Bank, World Development Indicators, Urban Population, 2010–2012.
Global Cities in Southeast Asia

In the globally connected knowledge economy, and Jakarta with 10.3 million. Four others
global cities are key to the economic success of have populations between five and 10 million:
nations. Cities like New York, London, Tokyo, Bangkok (9.3 million), Ho Chi Minh City (7.3
and Paris play a substantial role in the wealth million), Kuala Lumpur (6.8 million), and Sin-
and innovativeness of their respective nations. gapore (5.6 million).
How do the Southeast Asian nations stack up as
global cities? In 2030, four metros in Southeast Asia are
projected to have populations greater than
Exhibit 24 lists the seven largest global cities in 10 million. Manila will grow to 16.8 million
Southeast Asia along with their internation- people, followed by Jakarta (13.8 million),
al benchmarks according to their population Bangkok (11.5 million), and Ho Chi Minh City
sizes in 1980, 2015, and their projected sizes (10.2 million). Kuala Lumpur will have a pop-
for 2030.23 ulation close to 10 million (9.4 million) while
Singapore will be approaching seven million
Two metros in Southeast Asia have more than (6.6 million).
10 million people: Manila with 13.0 million

PHNOM
PENH
BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
SINGAPORE
JAKARTA
Tokyo 38.0
Delhi 25.7
Shanghai 23.7
Mumbai 21.0
Beijing 20.4 2015 Population
(Figure in millions)
New York 18.6
Manila 13.0 10.1
Jakarta 10.3 1980 2030
Seoul 9.8 Population Population
(Projection)
Bangkok 9.3
Hong Kong 7.3
Ho Chi Minh City 7.3
Kuala Lumpur 6.8 1.0 million
Toronto 6.0
Singapore 5.6
Sydney 4.5
Phnom Penh 1.7
0 10 20 30 40
Population (millions)
Exhibit 24: Population of Global Cities in Southeast Asia

Source: United Nations, World Urbanization Prospects, 2014 revision, Population of Urban Agglomeration with
300,000 Inhabitants or More in 2014, by Country, 1950–2030, 2014.

Economic Output of
Southeast Asian Metros
Population is a key measure of size. But cities percent) and much greater than for Toronto
can be large and poor, small and affluent, or (15.5 percent), New York (8.1 percent), Shang-
anywhere in between. So it is useful to look at hai (5.7 percent), or Beijing (4.9 percent). It is
the economic size of Southeast Asian metros safe to say that the economies of the Southeast
based on their economic output or metropol- Asian nations literally turn on the performance
itan GDP.24 Exhibit 25 compares Southeast of these cities and metro areas.
Asia’s metros to their global benchmark metros
on this metric. Southeast Asia’s metros reflect Economic output provides a gauge of overall
the region’s tiered development pattern. Sin- economic strength, but economic output per
gapore occupies the top tier with economic person provides an even better gauge of pro-
output of $366 billion, more than Milan ($313 ductivity and of the development of a middle
billion). Jakarta is next with metro output of class. Exhibit 27 lists the seven major Southeast
$321 billion, followed by Bangkok with $307 Asian cities according to their economic output
billion, more than Toronto ($276 billion), Mi- per person.
ami ($263 billion), or Frankfurt ($230 billion).
Manila and Kuala Lumpur occupy a third tier With $66,864, Singapore has the highest eco-
with $183 billion and $172 billion in econom- nomic output per person among Southeast Asian
ic output respectively, more than Stockholm metros. It numbers among the world’s richest
($143 billion) and Stuttgart ($158 billion). Ho places, higher than Hong Kong ($57,244), sig-
Chi Minh City occupies a fourth tier with $71 nificantly higher than Sydney ($46,344), Toron-
billion in economic output, slightly less than to ($45,771), and Tokyo ($43,664), but lower
Turin ($78 billion) and Oslo ($74 billion). than New York City ($69,915).
But, how important are these metro areas to The remaining metros are quite a bit behind.
Kuala Lumpur is next with a per person eco-
their overall national economies? We get at this
by looking at their share of national economic nomic output of $28,076, less than half of
output as shown in Exhibit 26.25 Singapore, though it is higher than Shanghai
($24,065) or Beijing ($23,390). It is followed by
Southeast Asia’s leading metros account for Bangkok ($19,705), Manila ($14,222), Jakarta
strikingly high levels of their country’s eco- ($9,984), and Ho Chi Minh City ($8,660).
nomic output, much higher than cities and met-
ros in the advanced Western nations. Bangkok
accounts for more than three quarters (75.9
percent) of Thailand’s economic output. Manila
accounts for almost two-thirds (64.2 percent)
of all economic output in the Philippines and
Kuala Lumpur (50.8 percent) half of Malaysia’s
economic output. Jakarta (36.1 percent) and
Ho Chi Minh City (38.2 percent) account for
more than a third of their country’s economic
output. This is about the same as Tokyo (35.2

BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
SINGAPORE
JAKARTA
Tokyo $1,617
New York $1,404
Seoul $846
Shanghai $594
Beijing $506
Hong Kong $416
Singapore $366
Jakarta $321
Bangkok $307
Delhi $294
Toronto $276
$100 billion
Sydney $223
Manila $183
Kuala Lumpur $172
Mumbai $151
Ho Chi Minh City $71
0 400 800 1,200 1,600 $2,000

Economic Output (billions)
Exhibit 25: Metropolitan Economic Output in Southeast Asia

Note: Economic output is metropolitan GDP in purchasing power parity terms. Metropolitan GDP is not available for
Phnom Penh.
Source: Brookings Institution, 2014 Global Metro Monitor, 2015.

BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
JAKARTA
Bangkok 75.9%
Manila 64.2%
Seoul 60.0%
Kuala Lumpur 50.8%
Ho Chi Minh City 38.2%
Jakarta 36.1%
Tokyo 35.2%
Toronto 15.5%
Sydney 15.4%
Delhi 11.7% 10.0%
New York 8.1%

Mumbai 7.4%
Shanghai 5.7%
Beijing 4.9%
0 20 40 60 80%
Metropolitan Share of Total National Economic Output
Exhibit 26: Metropolitan Share of Total National Economic Output in Southeast Asia
Note: Economic output is metro GDP in purchasing power parity terms. National GDP is at purchaser’s prices in current
US dollars. Metro GDP Data is not available for Phnom Penh. Singapore and Hong Kong are city-states where metro
and national GDP are essentially the same by definition.
Source: Brookings Institution, 2014 Global Metro Monitor, 2015; World Bank, World Development Indicators, GDP,
2014. GDP is in current US dollars.

BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
SINGAPORE
JAKARTA
New York $69,915

Singapore $66,864
Hong Kong $57,244
Sydney $46,344
Toronto $45,771
Tokyo $43,664
Seoul $34,355
Kuala Lumpur $28,076
Shanghai $24,065
Beijing $23,390
Bangkok $19,705
$10,000
Manila $14,222
Delhi $12,747
Jakarta $9,984
Ho Chi Minh City $8,660
Mumbai $7,005
0 25,000 50,000 $75,000

Metropolitan Economic Output per Person
Exhibit 27: Metropolitan Economic Output per Person in Southeast Asia

Note: Metropolitan economic output is not available for Phnom Penh.
Source: Brookings Institution, 2014 Global Metro Monitor, 2015.

The Urban Productivity Ratio
in Southeast Asia
Another way to capture this city-based edge is Comparing the urban economic output per
through a measure we call the “urban produc- person to the national economic output per
tivity ratio.”26 Basically, this measure compares person reveals the differences in living stan-
the productivity of cities to that of their nation. dards and economic development levels be-
Specifically, it is a ratio of the per person eco- tween metros and the rest of the country. All
nomic output of a city to that of its nation. The Southeast Asian cities have significantly higher
higher the ratio, the greater the difference economic output per person than their country.
in productivity between a major city and the Manila and Ho Chi Minh City’s economic out-
country as a whole. In the United States and put per person are six times higher than that of
the advanced nations, the most productive cit- their countries. Bangkok’s is almost four times
ies have urban productivity ratios between 1.5 higher than Thailand’s, while Jakarta and Kua-
and 2.0. Exhibit 28 lists the urban productivity la Lumpur’s are three times higher than that of
ratios for the seven key Southeast Asian metros Indonesia and Malaysia.
and their global benchmarks.27

BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
JAKARTA
Delhi 8.6
Manila 6.0
Ho Chi Minh City 5.6
Mumbai 4.7
Shanghai 4.5
Beijing 4.4
Bangkok 3.8
Jakarta 3.0
Kuala Lumpur 2.9
1.0
Seoul 1.5
New York 1.4
Tokyo 1.0
Toronto 0.9
Sydney 0.8
0 2.0 4.0 6.0 8.0 10.0

Urban Productivity Ratio
Exhibit 28: The Urban Productivity Ratio in Southeast Asia

Note: Metro Economic output is not available for Phnom Penh. Singapore and Hong Kong are city-states where metro
and national economic output are essentially the same by definition.
Source: Brookings Institution, 2014 Global Metro Monitor, 2015; World Development Indicators, GDP Per Capita,
2010–2012.

The Global Cities Index
in Southeast Asia
But how do Southeast Asian cities compare to
the great global cities of the world?
To get at this, we developed a Global Cities

Index by combining four key indicators and
rankings that cover: (1) their economic output,
(2) the strength of their banking and finance
industries, (3) their overall economic compet-
itiveness, and (4) their quality of place.28 The
ranking in Exhibit 29 provides an approximation
of a metro’s position in the global urban hierar-
chy today and projected for 2025, compared to
their global benchmarks.
Singapore takes the top spot among South

Asian global cities. It ranks fourth, with a score
of 381.2 and closely behind and New York
and Hong Kong, but ahead of Tokyo, Toronto,
Seoul, and Sydney. The second tier includes
Kuala Lumpur (218.1, 39th) and Bangkok
(197.9, 50th) which are behind Shanghai (292.5,
18th) and Beijing (264.5, 26th). Jakarta (141.0,
65th) and Manila (112.1, 75th) comprise the
third tier, on par with Mumbai (141.0, 64th)
and Delhi (122.4, 70th) and still within the top
25 percent of all 338 cities. Ho Chi Minh City
(58.4, 145th) occupies a fourth tier, but still
within the top 50 of all 339 cities. Phnom Penh
is not yet recognized as a global city. The rank-
ings are similar in our projections out to 2025.

BANGKOK MANILA
HO CHI MINH CITY
KUALA LUMPUR
SINGAPORE
JAKARTA
New York
#1 – 397.5
Hong Kong
#3 – 382.0
#5 – Tokyo 368.9
#11 – Toronto 339.2
#13 – Seoul 331.7
#14 – Sydney 328.2 2015 Score
#18 – Shanghai 292.5
300.3
#26 – Beijing 264.5
#39 – Kuala Lumpur 2025 Score
218.1 (Projection)
#50 – Bangkok 197.9
#64 – Mumbai 141.0
#65 – Jakarta 141.0
#70 – Delhi 122.4 50.0
#75 – Manila 112.1

#145 – Ho Chi Minh City 58.4
0.0 100.0 200.0 300.0 400.0

Global Cities Index
Exhibit 29: Global City Index in Southeast Asia

Note: Data are not available for Phnom Penh
Source: The Global City Index is based on the following sources (the Appendix provides further detail on it): Brookings
Institution, 2014 Global Metro Monitor, 2015; Z/Yen Group, Global Financial Centres Index 15, 2014; A.T. Kearney,
2014 Global Cities Index, 2014; The Economist’s Hot Spots 2025, 2013.

Conclusion
This report has examined the rise of an urban class keeps up with Thailand and Vietnam, its
creative class in Southeast Asia and its cities. It performance on the Global Creativity Index
finds that Southeast Asia can be divided into falls back. Cambodia’s four percent share of
four tiers of development. creative class workers is just half of Indonesia’s,
while its creative economy development is still
Singapore occupies the first tier. With $51,149 nascent. With per person economic output
in economic output per person it is one of rich- of $869, Cambodia ranks among the world’s
est and most developed nations in the world “low-income” nations. Just a fifth of Cambodia’s
— ahead of Canada ($50,555) and the United population is urbanized, much lower than other
States ($49,989). Singapore’s biggest constraint Southeast Asian nations
to continuing strong creative economy develop-
ment is its lower level of tolerance, especially of Our research also examined the status of the re-
the gay and lesbian community, which will cer- gion’s largest cities and metro areas. The region
tainly limit its ability to attract and retain talent has two mega-cities with populations bigger
from other nations, and compete with the most than 10 million: Manila and Jakarta. Four
open nations in the world. others have populations between five and 10
million: Bangkok, Ho Chi Minh City, Kuala
Malaysia and the Philippines occupy a second Lumpur, and Singapore. By 2030, four cities
tier with economies that are developing rapid- in Southeast Asia are projected to have pop-
ly and a substantial middle class. The creative ulations greater than 10 million. Manila and
class makes up a quarter of Malaysia’s work- Jakarta, plus Bangkok and Ho Chi Minh City.
force and a fifth of that of the Philippines, ap- Kuala Lumpur will have a population close to
proaching the levels of advanced nations. They 10 million while Singapore will be approaching
rank among the top 50 or so of the world’s na- seven million.
tions, both in terms of their share of creative
class workers and performance on the Global Southeast Asia’s cities and metros also reflect
Creativity Index. Malaysia has a level of eco- the region’s tiered development pattern.
nomic output per person ($9,748) which places
it among the world’s “upper-middle income” Singapore occupies the top tier. With econom-
nations. Roughly three-quarters of its popula- ic output of $66,864 per person, it is one of
tion is urbanized, not far off that of the United the most prosperous and advanced cities on the
States and advanced nations. planet, ranking just below New York City and
ahead of Tokyo, Toronto, Seoul and Hong Kong.
Thailand and Vietnam fall into a third tier. The It ranks as the fourth most advanced global city
creative class comprises roughly 10 percent of in the world behind only New York, London
their workforces. They rank among the lower and Tokyo.
half of nations globally both in terms of their
creative class and Global Creativity Index. Kuala Lumpur occupies a second tier with eco-
nomic output of $28,076 per person, more than
Indonesia and Cambodia occupy a fourth tier Shanghai ($24,065) or Beijing ($23,390). This
of development. While Indonesia’s creative is considerably nearly three times bigger than

Malaysia as a whole ($9,748). With $172 mil- ing the broader pattern of uneven development
lion in total economic output, more than Stutt- between the advanced nations and cities of the
gart ($158 million) or Stockholm ($143 million) Global North and the struggling nations and
it generates more than half (50.8 percent) of cities of the Global South. The region spans
Malaysia’s GDP. Kuala Lumpur is three times Singapore, one of the most affluent and urban-
as productive as Malaysia. It ranks 39th on the ized places on the planet, and Cambodia one of
Global City Index, not too far behind Beijing. the very poorest.
Bangkok and Manila fall into the third tier, There are two big takeaways that flow from our
with economic output per person of $19,705 research which bear on the future growth of
and $14,222 respectively, considerably greater the middle class and the further economic de-
that for Thailand ($5,158) or The Philippines velopment of Southeast Asia. The first is wheth-
($2,360) as a whole. Bangkok’s economic out- er urbanization can continue to propel econom-
put is $307 billion, more than Miami ($263 bil- ic development and the rise of a new middle
lion) or Frankfurt ($230 billion), and accounts class. In the twentieth century, Western urban-
for more than three quarters of Thailand’s total ization went hand in hand with economic devel-
GDP. Manila generates $183 billion in econom- opment and rising living standards. This pattern
ic output, more than Stockholm ($143 billion), repeated itself in China, helping the nation to
which makes up nearly two-thirds of the Philip- become a leading world economy. It remains to
pine’s GDP. Bangkok is nearly four times more be seen whether this path to growth and pros-
productive than Thailand as a whole, and Manila perity will hold for Southeast Asia. While some
six times more productive that the Philippines. areas of Southeast Asia are urbanized and afflu-
ent, many others have yet to undergo this trans-
Jakarta and Ho Chi Minh City occupy the formation. These less-developed parts of the re-
fourth tier with economic output per person of gion appear to be suffering from “urbanization
$9,984 and $8,660, which while lower than the without growth,” urbanization is failing to lead
other Southeast Asian cities is still considerably to greater economic growth and the rise of the
larger than for Indonesia ($3,323) or Vietnam middle class. Today, many Southeast Asian cities
($1,544). With total economic output of $321 face the challenge of transitioning from centers
billion, Jakarta is a bigger economy than To- with eroding manufacturing and service based
ronto ($276 billion), while Ho Chi Minh City economies to more propulsive urban creativity-
with $71 billion in output is just slightly smaller and knowledge-based economies.
than Turin ($78 billion) or Oslo ($74 billion).
Both account for more than 35 percent of their The second revolves around the future growth
respective national economies. Productivity in of the new creative middle class. While some
Jakarta is three times higher than for Indone- Southeast Asian nations have a sizeable creative
sia as a whole, while it is more than five times class, in others it is just beginning to develop. It
higher in Ho Chi Minh City than for the Viet- is harder today to develop a middle class based
namese economy. on blue-collar manufacturing. The urban mid-
dle class is either developing slowly or failing
So is urbanization helping to propel economic to develop in some Southeast Asian nations and
growth in Southeast Asia or not? The answer, cities. This will continue to be a critical chal-
from our research, is a qualified yes. That said, lenge for the region, its nations, and cities for
the level of economic development across the the future.
region and its cities is highly uneven, mirror-

Research, Variables, and Data
This appendix provides detail on the variables, rank of each. The correlation between the cre-
indexes, and data sources used in this report. ative class and educational attainment variables
For the most part, these data cover the seven is 0.64.
Southeast Asian nations and 139 nations for the
period of 2010 to 2012. We sometimes use dif- Innovation: The variable for global innovation is
ferent years for different variables and utilize based on patent applications per million people.
running averages, depending on the availability The data are from the World Bank’s World De-
of data. velopment Indicators for the period 2010–2012.
Creative Class: The creative class is calculated as R&D Investment: This variable measures R&D
the share of a country’s labor force that is en- investment as a share of economic output or
gaged in creative, knowledge-based, and profes- GDP. It includes R&D expenditures for basic
sional occupations spanning computer science research, applied research, and experimental
and mathematics; architecture, engineering; development. The data are from the World
life, physical, and the social sciences; education, Bank’s World Development Indicators for the
training, and library science; arts and design period 2010–2012.
work, entertainment, sports, and media; and
professional and knowledge work occupations Technology Index: The Technology Index com-
in management, business and finance, law, sales bines these two variables into a single measure.
management, and healthcare. The Labour Sta- It is based on the ranks of the variables; a coun-
tistics are from the International Labour Orga- try must have a value for at least one of the two
nization (ILO), covering the years 2010 to 2012, variables in order to create a technology index
except for Singapore and New Zealand, where score. The correlations between R&D invest-
the values are for the period 2004–2007. ment and global innovation is 0.57.
Educational Attainment: This variable is based on Tolerance Toward Ethnic and Racial Minorities:
a measure of “gross tertiary enrollment.” Ter- The variable is based on the survey question
tiary education includes universities, colleges, “Is your city or area a good or bad place to be
community colleges, technical training insti- in for ethnic and racial minorities?” from the
tutes, and other post-secondary institutions. Gallup Organization’s World Poll. The World
Specifically, we use the conventional measure Poll survey is based on approximately 1,000 in-
of the “gross tertiary enrollment ratio” which terviews per country (adjusted for population
is the ratio of all those involved in tertiary edu- size) which are conducted in approximately 150
cation compared to the age group spanning five countries. The sample represents roughly 95
years after leaving secondary school. The data percent of the world’s adult population and is
are from the World Bank’s World Development stratified proportionally, with the distribution
Indicators for the period 2010 to 2012. of the population across cities and rural areas of
different sizes. The target population is all ci-
Talent Index: The Talent Index combines these vilian, non-institutionalized, and ages 15 years
two variables in a single index based on the or older.

Tolerance toward the Gay and Lesbian Community: Income Inequality: This variable is based on the
This is based on the survey question “Is your standard measure of income inequality — the
city or area a good or bad place to be in for gays Gini Coefficient. The Gini Coefficient ranges
and lesbians?” from the Gallup Organization’s from 0 to 1, with higher values indicating high-
World Poll. er levels of inequality. The data are from the
World Bank’s World Development Indicators
Global Creativity Index: The Global Creativity and is an average for the years 2004–2013, and
Index is a composite index based on the three the Central Intelligence Agency (CIA)’s The
overall indexes for talent, technology, and tol- World Factbook Distribution of Family Income
erance. We rank each by giving the highest val- — Gini Index, with values mostly for the years
ue to the top performer. We then add the ranks 2011–2014.
together and divided by three. In cases where a
value for only two of the three variables was Urban Population: Urban population refers to peo-
available, these two were added and divided by ple living in urban areas as defined by national
two. To create the overall index score, we di- statistical offices. This data is from the Unit-
vide the average score of the 3Ts by the number ed Nations’ World Urbanization Prospects, 2014
of observations overall. revision. The variable is Urban Population at
Mid-Year by Major Area, Region and Country,
National Economic Output Per Person: This variable 1950–2050.
is based on the conventional measure of eco-
nomic output based on gross domestic product Urbanization: Urbanization refers to the per-
or GDP. We use the average for the years 2010 centage of people living in urban areas and cit-
to 2012 and all values are expressed in US dol- ies. The data is from the United Nations’ World
lars. Data are from the World Bank’s World De- Urbanization Prospects, 2014 revision. The vari-
velopment Indicators GDP Per Capita, 2010–2012. able is Percentage of Population at Mid-Year
Residing in Major Area, Region and Country,
Economic Competitiveness: This variable is based 1950–2050.
on the Global Competitiveness Index devel-
oped by Michael Porter for the World Econom- Urbanization and Economic Development: The data
ic Forum. are from the World Bank’s World Development
Indicators, GDP Per Capita, for 2010–2012, and
Entrepreneurship: This variable is based on the Urban Population, 2010–2012.
Global Entrepreneurship Index. The index is
based on measures of entrepreneurial attitudes, Population of Global Cities: The data is from the
activity, and aspiration. United Nations’ World Urbanization Prospects,
2014 revision. The variable is Population of Ur-
Human Development: This variable based on the ban Agglomeration with 300,000 Inhabitants
United Nations Human Development Index, a or More in 2014, by Country, 1950–2030.
composite measure which aims to capture three
dimensions of human development: health and Metropolitan GDP: Economic output is metro-
measured life expectancy, education level, and politan GDP in purchasing power parity terms.
standard of living. The data are from Brookings Institution’s 2014
Global Metro Monitor, 2015.

Metropolitan Share of Total National Economic Out- Research Travel: This research is informed by
put: The metropolitan share of the total nation- field work, site visits, and in-person conver-
al economic product is based on metro GDP sations with regional experts and senior level
from the Brookings Institution’s 2014 Global executives in Hong Kong and at the New Cities
Metro Monitor, and the World Bank’s World De- Summit 2015 in Jakarta.
velopment Indicators, GDP, for 2014. GDP is
in current US dollars. It is important to note
that the methodology of calculating the GDP
values differ in both sources.
Metropolitan GDP Per Person: The data for metro-

politan GDP per person are from the Brookings
Institution’s 2014 Global Metro Monitor, 2015.
Urban Productivity Ratio: The urban productivity

ratio measures the difference in productivity
between per person metropolitan economic
output based on data from the Brookings In-
stitution’s 2014 Global Metro Monitor, and the
World Bank’s World Development Indicators GDP
Per Capita, 2010–2012. The higher the ratio,
the greater the difference is in productivity be-
tween the city in question and the country as a
whole. It is important to note that the methodl-
ogy of calculating the GDP values differ in both
sources.
Global City Index: The Global City Index is based

on the following measures: (1) Economic Power
is based on economic output and economic out-
put per capita from the Brookings Institution’s,
2014 Global Metro Monitor; (2) Financial Power is
based on Global Financial Centres Index 15 which
measures a range of factors related to a city’s
banking, finance, and investment industries;
(3) Competitiveness is based on A.T. Kearney’s
2014 Global Cities Index, which tracks elements
of business activity, talent, and competitive-
ness; and (4) Competitiveness and Quality of
Place based on The Economist’s Hot Spots 2025.
We calculate a city’s overall score as the sum
of their scores on the individual indices which
range from 1 to 100 with 100 being the highest
score. We provide two rankings, for 2015 and
for 2025.

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About the Authors
Richard Florida
Richard is Director of Cities at the Martin Prosperity Institute at the Uni-
versity of Toronto’s Rotman School of Management. He is also Global Re-
search Professor at New York University, and a senior editor for The Atlan-
tic, where he co-founded and serves as Editor-at-Large for CityLab.
Melanie Fasche
Melanie is a Postdoctoral Fellow with the Cities team at the Martin Pros-
perity Institute at the University of Toronto’s Rotman School of Manage-
ment. She is leading the research project on “Urbanization and the rise of
the creative/middle class in Southeast Asia”.
Acknowledgements
All research projects are team efforts, but this one especially so. Charlotta Mellander
developed and carried out the creative class analysis for Southeast Asia and provided
ongoing support with the overall data analysis. Karen King supported the research
travel and the overall data analysis. Greg Spencer also supported the overall data
analysis. Taylor Blake created the maps and Michelle Hopgood created the graphics.
Ian Gormely and Aria Bendix lent their hands to editing this report. Sharukh Ahmed,
Jessie Huang, and Grace Chen provided research assistance. Vass Bednar and Jamison
Steeve oversaw and guided this project.
Martin Prosperity Institute
Rotman School of Management
University of Toronto
105 St. George St., Ste. 9000
Toronto, ON M5S 3E6
w martinprosperity.org
e assistant@martinprosperity.org
t 416.946.7300
f 416.946.7606
© January 2017
ISBN 978-1-928162-11-7

Rise of The Urban Creative Class in Southeast Asia

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THE RISE OF THE

URBAN CREATIVE CLASS

The Martin Prosperity Institute, housed at the University of Toronto’s

The Creative Class in Southeast Asia 12

Creativity and Prosperity in Southeast Asia 26

Urbanization and Global Cities in Southeast Asia 38

Research, Variables, and Data 54

About the Authors 59

4 The Rise of the Urban Creative Class in Southeast Asia

5 The Rise of the Urban Creative Class in Southeast Asia

Southeast Asia is at the center of a significant economic transforma-

This report examines the intersection of urbanization and the rise of

6 The Rise of the Urban Creative Class in Southeast Asia

7 The Rise of the Urban Creative Class in Southeast Asia

Bangkok and Manila fall into the third tier, with

Jakarta and Ho Chi Minh City occupy the

8 The Rise of the Urban Creative Class in Southeast Asia

Southeast Asia is at the center of a significant economic transforma-

9 The Rise of the Urban Creative Class in Southeast Asia

10 The Rise of the Urban Creative Class in Southeast Asia

BENCHMARK SOUTHEAST ASIAN

Benchmark City Southeast Asian City

11 The Rise of the Urban Creative Class in Southeast Asia

Today, the creative class makes up anywhere from one third to 40

12 The Rise of the Urban Creative Class in Southeast Asia

Exhibit 2: The Creative Class in Southeast Asia

Source: International Labour Organization (ILO), Labour Statistics, 2010 to 2012.

13 The Rise of the Urban Creative Class in Southeast Asia

Aside from Singapore, gross tertiary enrollment

14 The Rise of the Urban Creative Class in Southeast Asia

#1 – South Korea 100.0%

Exhibit 3: Education in Southeast Asia

15 The Rise of the Urban Creative Class in Southeast Asia

0.000 0.200 0.400 0.600 0.800 1.000

Exhibit 4: The Talent Index in Southeast Asia

16 The Rise of the Urban Creative Class in Southeast Asia

Innovation in Southeast Asia The Technology Index in Southeast Asia

17 The Rise of the Urban Creative Class in Southeast Asia

#1 – South Korea 3,606

0 1,000 2,000 3,000 4,000

Exhibit 5: Innovation in Southeast Asia

18 The Rise of the Urban Creative Class in Southeast Asia

#1 – South Korea 0.991

0.000 0.200 0.400 0.600 0.800 1.000

Exhibit 6: The Technology Index in Southeast Asia

19 The Rise of the Urban Creative Class in Southeast Asia

Tolerance toward the Gay and Lesbian

20 The Rise of the Urban Creative Class in Southeast Asia

Exhibit 7: Ethnic and Racial Tolerance in Southeast Asia

Source: Gallup Organization, World Poll, 2014.

21 The Rise of the Urban Creative Class in Southeast Asia

Source: Gallup Organization, World Poll, 2012.

22 The Rise of the Urban Creative Class in Southeast Asia

0.000 0.200 0.400 0.600 0.800 1.000

Exhibit 9: The Tolerance Index in Southeast Asia

23 The Rise of the Urban Creative Class in Southeast Asia

24 The Rise of the Urban Creative Class in Southeast Asia

0.000 0.200 0.400 0.600 0.800 1.000

Exhibit 10: The Global Creativity Index in Southeast Asia

25 The Rise of the Urban Creative Class in Southeast Asia

We now know how the Southeast Asian nations stack up on various

To get at this, we compare the performance of these Southeast Asian

26 The Rise of the Urban Creative Class in Southeast Asia

The Creative Class in Southeast Asia 12

Creativity and Prosperity in Southeast Asia 26

Urbanization and Global Cities in Southeast Asia 38

Research, Variables, and Data 54

About the Authors 59