RANKING WORLD CITIES: MULTINATIONAL CORPORATIONS AND THE GLOBAL URBAN HIERARCHY

Abstract

World-city literature often relies on a priori assumptions rather than quantifiable measures to discern the global urban hierarchy. In search of comparable international indicators, many studies use the corporate headquarters of multinational corporations (MNCs) as primary locational data. Recognizing that MNCs play a dominant role in the global economy, we argue that reliance on headquarters locations alone distorts the contours of the urban hierarchy. The method overstates the importance of urban centers in the developed countries and economies dominated by large corporations; conversely, it underestimates the importance of lower-level circuits of regional communication, transaction centers in developing countries, and cities in less-centralized economies. This bias is not simply a technical matter: it asserts the power of the core economies, while understating the diversity and complexity of global interactions. We propose to include MNC first-level subsidiary locations in a more refined measure of world-city status.