Nation states and world cities: a preliminary empirical investigation into the role of nation states in a globalizing world
Date
2006-01
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Abstract
The specific form assumed by economic globalization over the last decade has given rise to world cities and has created a particular organizational requirement that led to the formation of the world city network. This study identifies the world city network as the spatial and organizational embodiment of contemporary globalization. In this paper, the authors attempt to empirically identify the factors affecting a city's connectivity to the world city network, which indicates the extent of a city's involvement in globalization, and whether the economic and political environment of the nation state still has anything to do with it.
A double-log model relating city global connectivity to a number of potential factors affecting a city's connectivity to the world city network is estimated by ordinary least squares (OLS). The highly statistically significant variables include financial market sophistication, quality of public schools, country credit rating and city population size. Collectively, these four variables explain 80% of the dispersion in city global connectivity. The 16 double-log bi-variate regression models relating city global connectivity to specific components of the ICT index show that each component ranging from ICT usage and government policies is positively and statistically significant to city global connectivity. All regression results generated in this study imply that the decision of transnational advanced producer service firms (the prime agents of globalization) to locate in a city is most responsive to the quality of government institutions, laws and rules governing competition rather than sheer accumulation ancillary technological infrastructures.
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Economic globalization, Globalization, Urbanization, Nation states, World cities