Essay from the year 2005 in the subject Economics – International Economic Relations, grade: 20, University of St Andrews (Department of Economics), language: English, abstract: The debate about the effects of globalisation on cities is controversial. On the one
hand, scientists and journalists predicted “the end of the city” due to technological
change, especially in the area of telecommunications – implying that an increased
number of home-workers and the possibilities of video-conferences would make
calm suburbs or rural areas more attractive in comparison to a grid-locked and expensive
downtown area.1 Yet, whenever the abstract idea of globalisation is illustrated
in newspapers or TV, it is not a suburb or the green hills of Fife that are
shown. Rather, symbols of globalisation like Manhattan or Tokyo look more like
Ridley Scott’s “Nighttown” in Bladerunner. In contrast to the prediction of declining
cities, globalisation seems to boost the growth of cities in a way that many scientists
– influenced by the ideas of Alfred Marshall and Joseph Schumpeter started to write
about “global cities”, “world-cities” or “global city-regions”. Leamer/Storper called
global cities the “big winners” of the Internet Age.2 But what are exactly the effects
of globalisation on the functions and economy of cities? In order to examine these
effects, it is useful to address two questions: (1) why do firms choose cities as a location
in general? (section 2.1); and (2) how does globalisation affect this reasoning?
(section 2.2). Section 3 summarises the results.
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