Why is economic power the most crucial determinant of a global city? Cite Example PDF

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Why is economic power the most crucial determinant of a global city? Cite ExampleGlobalization has slowly but surely been making development in most countries today. Some faster than the others, while some make bigger and affect more cities than the others. A few states though, have been massively g...

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Why is economic power the most crucial determinant of a global city? Cite Example

Globalization has slowly but surely been making development in most countries today. Some faster than the others, while some make bigger and affect more cities than the others. A few states though, have been massively growing more and more in power and have been spreading their influence at a greater rate. There are cities that possess great economic power including New York, London, Tokyo, Shanghai, Dubai, Singapore, Hong Kong, Paris, Beijing, and more. Economic power refers to a state’s, a company’s, or an individual’s ability to enhance their living. The more power an individual possesses economically, the more freedom there is in making decisions that will benefit this individual the most. Moreover, economic power is mostly determined through money. States, businesses, and people increase their economic power by also increasing their revenue and wealth. Economics is the term coined to refer to the social science responsible for the production, distribution, and the consumption of goods, wealth, and income. It focuses on a human being’s ability to make choices concerning wealth which then produces the optimal benefit. Basically, economics provides us with an understanding of the business, the market flows, and the government and its relevance. Now, how significant does a state’s economic power exactly have to be to be deemed a global city? Globalization plays a massive role in the increase of global cities because of competition among states. According to World's most global cities (2012), global cities are “crowded with those who are creating the future, noisy with the clash of deals and ideas, frantic in the race to stay ahead.” A global city is determined as those cities which run in the front lines of this competition, the top percentage. Global cities are ranked using the Greek alphabet with the Alpha++ being the highest and Gamma- being the lowest. Leading this percentage are the two Alpha ++ cities namely London and New York; with the likes of Tokyo and Paris in Alpha+; Sydney, Milan, and Los Angeles in Alpha; lastly, Bangkok and Manila City in the Philippines ranked in Alpha- for comparison. Global Power City Index 2021 (2021) listed several “power” categories in which these global cities are examined and ranked including: economy, research and development, cultural interaction, livability, environment, and accessibility. With all these categories considered, GPCI 2021 ranked London as the no. 1 global city. Focusing more into the state’s economic power though puts New York into the no. 1 rank. This factor is highly considered for other indexes like the Kearney 2021 Global Cities Report (2021) listing New York as the top 1 global city while London is the second. In this age, industries appear one after another. They all aim and compete for a place in the global market or maybe appear in one of the Fortune 500 issues. It is also a massive factor where new companies will be locating their businesses geographically. Startups from an economically powerful area usually get a big headstart with their businesses but are usually met with higher risks as well. Meanwhile, startups from a rather smaller state but with similar innovations and functions as those from an “economically powerful” state are more likely to succeed. This is because internal competition between companies in a more relevant state is way fiercer than the competition within a smaller state. In simple terms, basically if you take a disapproved business proposal from New York, complete it in Manila and you’ll likely succeed. An example is Forever 21 from Los Angeles, California which filed for bankruptcy in 2019 due to fierce competition. However, on the other side of the planet is the Forever 21 Philippines still thriving in sales and revenue. Companies, whether small or large, pay state taxes and contribute to their local government’s economy in more ways than one. In a capitalistic society like ours, the busiest cities compete on a race of economic power especially with the rise of globalization. Ideas, goods, and services are being passed around all over the world and those who are able to utilize these

ideas in the best way possible, or as well as market their goods and services the best receive the greatest revenue among everyone else. Seoul, Korea houses Samsung, Hyundai, and LG Electronics which all are among the top companies from the industries they are in. Tokyo, Japan is another example as Toyota and Sony Corporation are both headquartered therein, both are currently leading both the automotive industry and technology industry respectively. Another example is Paris, France which houses Louis Vuitton, Hermès, and Dior, all which are massive designer brands acknowledged and worn everywhere around the world. With great revenue comes greater economic power and with great economic power, more goods and services are produced which then pulls in even greater revenue through globalization and thus an ongoing cycle of the rich becoming richer. Recall the 6 categories the GPCI 2021 listed, a state with a greater economic power enables them greater access to the remaining 5 categories. This means that from the beginning, states prioritize trade and business among everything else because a stable flow of state revenue allows them to thrive on the other factors including research and development, a more diverse cultural demographic (cultural interaction), real estate (livability), environment, and accessibility. However, prioritizing the economy of the capital city in a small state in order to compete globally only negatively affects the rest of the country due to centralization. On the downside, competing in the global scene means neglecting domestic interdependence to an extent and thus brings more harm to a developing country than to those that are already developed. Much like how the rich differ from the poor. And finally, what does the rich usually gain? Dare I say, “fame and power.” Global cities emerged with the rise of globalization. Through globalization, the economy has expanded all over the world due to the exchange of ideas, goods, and services. Moreover, the utilization and innovation of these resources allowed states to further increase their revenue and influence around the world. These cities possess what is called the economic power and upscales to competing on the global market as representatives of their respective nations. The further increase in economic power enables these cities to invest and thrive on the other determining factors including research and development, cultural interaction, livability, environment, and accessibility. Which thus finally entitles them as a global city.

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