STATE OF THE WORLD'S CITIES 2012/2013 Prosperity

State of the World’s Cities 2012/2013
FACT
Cities that succeed
in fostering the
exchange of ideas and
innovations are able to tap
into growth dynamics that
fuel the creation of social
and intellectual capital,
thereby further contributing
to their productivity.
POLICy
Cities that
succeed in
educating, attracting
and retaining creative
individuals are more likely
to prosper, as they not only
generate new ideas and
products but, in turn, also
attract high-value added
firms, such as knowledgebased
industries.
Some cities are
strengthening comparative
advantage by showcasing
their tangible and
intangible heritage and
exploiting their cultural
identity, in an effort to
bring about social and
economic transformation. 20
Doha, for example, is
developing education and
arts as part of the city’s new
cultural vision. 21 Gaziantep
in eastern Turkey has
started to use cultural
heritage as a touristic
asset for the purposes
of increased prosperity.
Heritage restoration and
rehabilitation enhance
quality of life while
contributing to economic
development. 22
Talent, in turn, is a
function of the quality of
school systems and higher
education. Many cities in
the developing world are
faced with brain drain
due to lack of local and
national policies to retain
highly qualified individuals.
With the exception of
Asia, where about half of
the local experts perceive
that cities are making
efforts to retain talent, the
proportions are alarmingly
low in other regions.
There are exceptions,
though: Dubai emphasizes
higher education and
training in engineering and
information technologies. 23 Chongqing has developed an
ambitious training programme to support the transition of
rural migrants from manual-based to skill-based types of
work; by 2009, nearly one-third of migrants had benefited
from the scheme. 24
A city’s existing
FACT talent pool is
a major determinant of
productivity. The more
highly skilled a city’s
population, the more likely it
is to attract more talent.
By offering an
POLICy environment
conducive for Research and
Development, cities can be
key players in a knowledgebased
economy, as there
is a direct link between
Research and Development,
technology and productivity.
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Some cities in developing countries have embraced
the model of world-class innovation clusters, such as
California’s Silicon Valley or Boston’s Route 128, to become
‘high-tech hubs’. Those that have met with success in
this endeavour, such as India’s Bangalore, owe it to the
same basic factors: the presence of top-quality academic
and research institutions as well as substantial public and
corporate investment. However, some observers claim
that the city needs to pay more attention to infrastructure
development and to ensure that the benefits of growth are
more evenly distributed across all the population.
Quality of life is rapidly emerging as a major asset
in any efforts to attract and retain creative minds and
businesses. It comes as no surprise that Toronto, San
Francisco or Stockholm should consistently rank among
the top performing cities in the world, since they are found
as performing particularly well in a wide range of both
economic and quality of life indicators, crime, green areas,
air quality and life satisfaction. Outside the more developed
nations, Singapore, with a similar balance of quality of life
attributes, also ranks among the top world cities and the
highest among developing countries.
URBAN PRODUCTIvITy: SOME CHALLENGES
While China’s urban population increased from 17 to
39 per cent within a span of 40 years (from 1963 to 2003),
the same change in urban population took 120 years in
Great Britain and 80 years in the USA. 26 Cities in more
advanced countries are better positioned to capitalize on
the agglomeration economies associated with population
growth. This is not just because that growth is more
manageable (typically around one per cent per year); but
also because, as suggested by their high GDP per capita,
these cities already have the physical and institutional
support needed to capitalize on that demographic
potential. Such capacities are generally not available in
developing countries,
leaving fast-expanding
cities more exposed
to the agglomeration
diseconomies which
prevent them from
fully capitalizing on the
productivity potential
associated with sustained
population growth
(typically an annual rate
of two to four per cent or
FACT
Top performing
cities derive
their strengths not
just from their status
as global economic
powerhouses or
from sophisticated
infrastructure, but
also from their ability
to enhance quality of
life. 25