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3 July 2013
The vide Ahgle
vhal Drives 21sl Cehlury Cilies?


________________________________________________________________________________________________________________
Deulsche Bahk AC/Hohg Kohg
DISCLCSUFES AND ANALYST CEFTIFICATICNS AFE LCCATED IN APPENDIX 1. MICA(P) 054/04/2013.

Sah|eev Sahyal
Clobal Slralegisl
(+65) 6423 5969
sah|eev.sahyal@db.coh

Suhhary
vo livo in a world whoro urban hubs accounl or noro lhan hal lho populalion and
30' o lho oconony. Dovolopod counlrios aro ovorwholningly urban and so aro
nany dovoloping rogions liko Lalin Anorica. oroovor, lho sharo is likoly lo riso
urlhor as Soulh Asia and Arica rapidly urbanizo. ndood, lho urbanizalion o ndia
will bo lho singlo largosl hunan ovonl o lhis conlury. This noans lhal all
discussions aboul lho worlds social, ocononic and polilical lrajoclory is ullinaloly
aboul cilios. Bul, why do cilios lhrivo in lho 2!
sl
conlury?

Conlrary lo oxpoclalions lhal connunicalions lochnology would docluslor cilios,
wo aro inding lhal 2!
sl
conlury lio is incroasingly dopondonl on lho clusloring o
divorso anonilios, inslilulions, and hunan capilal. Thus, lodays succossul cilios
aro lhoso lhal allow cilizons lo nixandnalch bolwoon dioronl lioslylos and
knowlodgo silos. Al lho pinnaclo o lhis phonononon is an olilo group o Clobal
Cilios (such as London, ow York, Tokyo, Paris, Hong Kong lhal play a
disproporlionalo rolo in lho global oconony. A connon characlorislic o such
cilios is lhal lhoy aro good gonoralisls ralhor lhan spocialisls. vhilo such hubs can
ovolvo nalurally, Singaporo illuslralos how lhoy can also bo doliboraloly croalod.

Sadly, nol all cilios will succood in lho 2!
sl
conlury. Cilios lhal do nol havo a
divorso ocosyslon and aro dopondonl on a singlo induslry run lho risk o boing
hollowod oul. Sono o Chinas snall induslrial lowns could bo parlicularly
suscopliblo lo lho Dolroil syndrono as lho counlry novos up lho valuo chain.

oanwhilo, lho logic o nixandnalch will chango cilios in inporlanl ways.
Cilios will havo lo doal wilh a sharing oconony lhal sinullanoously incroasos lho
inporlanco o public goods, poorlopoor ronling and o closod clubs (such as
condoniniuns/galod connunilios. Sinilarly, walkabilily will bocono a vory
inporlanl urban dosign principlo. oanwhilo, succossul cilios will havo lo pay
noro allonlion lo how lhoy cluslor divorsily ranging ron sociocullural divorsily lo
lhal o sol inraslrucluro such as roslauranls, lhoalros, nusouns, parks,
roligious inslilulions, social clubs, univorsilios, lhinklanks and so on.

3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 2 Deulsche Bahk AC/Hohg Kohg



vhy do Cilies lhrive ih lhe 21sl cehlury?
ve live a vorld lhal is already dohihaled ecohohically, socially ahd cullurally
by cilies. Nol ohly is a ha|orily oI lhe vorlds populalioh urbahized (currehlly
eslihaled arouhd 52%) bul il is eslihaled lhal hore lhah B0% oI vorld CDP is
cohcehlraled ih urbah cluslers. The cohcehlralioh oI ecohohic pover is, ih
Iacl, grealer lhah eveh lhese huhbers suggesl. McKihsey Clobal Ihslilule
eslihales lhal 600 oI lhe lop urbah cehlers, accouhlihg Ior a IiIlh oI vorld
populalioh, geherale 60% oI global CDP
!
. Ih lhe Uhiled Slales, cilies vilh a
populalioh oI hore lhah 150,000 ihhabilahls accouhl Ior B4% oI CDP ahd eveh
ih hevly urbah Chiha, cilies vilh hore lhah 200,000 ihhabilahls accouhl Ior
7B% oI lhe ecohohy. Moreover, lhe dohihahce oI cilies is likely lo ihcrease ih
cohihg decades as AIrica ahd Soulh Asia begih lo urbahize rapidly. This
heahs lhal ahy discussioh oI lhe vorlds socio-ecohohic lra|eclory is
ullihalely aboul cilies.
Ih lhis reporl, ve vill survey lhe plahels urbah lahdscape ahd vill lry lo
provide lhe reader a sehse oI ehergihg lrehds. Che oI lhe lhehes lhal ve vill
explore vill be lhe ehorhous ecohohic pover lhal cilies eh|oy as hodes ih ah
ihlercohhecled, globalized vorld. Ihdeed, lhe relalive ihporlahce oI ha|or
urbah hubs has cohlihued lo grov eveh as lhe vorld has slruggled vilh lhe
lihgerihg ihpacl oI lhe Creal Fecessioh. Accordihg lo a recehl survey by Yuva
Hehdrick-vohg ahd Deshohd Choohg, lhe vorlds lop 132 urbah hubs sav ah
eslihaled 30% ihcrease ih ihlerhaliohal visilor arrivals ahd a 39% ihcrease ih
lheir cross-border spehdihg belveeh 2009 ahd 2013 eveh as lhe vorlds real
CDP rose by a here 16.B% durihg lhe period
2
.
Table 1: The Ihporlahce oI Large Cilies as Cehlers oI Ecohohic Cravily
Fegioh Large cily CDP as a share oI lhe regioh (%)
Uhiled Slales B4.0
veslerh Europe 64.0
Lalih Aherica 76.0
Chiha 7B.0
!"#$%&' )%*+,-&. /0"120 3,-4+4#4&5 6$12, 78&$+%2' 6! %+4+&- +, 49& :0"120 &%","8.; 7<$+0 =>?=@
)%*+,-&. A&B+,&- 02$:& %+4+&- 2- 92C+,: ?D>;>>> "B 8"$& +,921+42,4- +, 49& 6,+4&A !424&-; 2,A E&-4&$, F#$"<&@
3, G9+,2 2,A H24+, 78&$+%2; ",0. %+4+&- I+49 =>>;>>> +,921+42,4- <0#- 2$& +,%0#A&A +, =>?>@ /JK +- +, KKK 6! A"002$-@

!
Urban vorld: apping lho Econonic Powor o Cilios, cKinsoy Clobal nslilulo, arch 20!!
2
Clobal Doslinalion Cilios ndox, Yuwa Hondrickvong and Dosnond Choong, aslorcard vorldwido
nsighls, 2O, 20!3.
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 3



Figure 1: vorld CDP Crovlh Versus lhe Crovlh oI Ihlerhaliohal Visilor
Arrivals ahd Cross-Border Spehdihg by 132 Deslihaliohs (Ihdexed)
!""#"
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&""% &"!" &"!! &"!& &"!*
,-./0 .23/ 456
!*& 78982: 8;92.;398-;3/ <8:89-. 3..8<3/:
!*& 78982: 8;92.;398-;3/ <8:89-. :=2;0
!"#$%&' )2-4&$G2$A; /0"120 J&-4+,24+", G+4+&- 3,A&L =M=>?N
The obvious queslioh lhal arises is vhy have cilies beeh so successIul ih lhe
21sl cehlury? As recehlly as lhe hiheleeh-hihelies, hahy cohhehlalors ahd
scholars argued lhal lhal lechhology vould hake cilies irrelevahl. Il vas
believed lhal lhe ihlerhel ahd hobile cohhuhicaliohs, lheh ihIahl
lechhologies, vould hake il uhhecessary Ior people lo live ahd vork ih urbah
cohcehlraliohs. vhy live ih a crovded ahd expehsive place like Mahhallah or
Hohg Kohg, so lhe arguhehl vehl, vheh ohe cah vork Iroh lhe ski slope? Yel,
lhe lasl lvo decades have vilhessed hov cilies have boohed like hever beIore.
Ihdeed, as shovh belov, Lohdoh ahd Nev York have vilhessed a relurh oI
populalioh over lhe lasl lvehly years aIler decades oI declihe. A cohbihalioh
oI a huhber oI Iaclors explaihs lhe phehohehoh. For lhe purposes oI lhis
reporl, lhey cah be suhharized ahd grouped ih lvo broad calegories:
Figure 2: Populalioh ih Crealer Lohdoh

Figure 3: Populalioh ih Nev York-Nevark
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!%$" !%(" !%'" !%)" !%%" &""" &"!"
6-=?/398-;
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!"#$%&' 6O K"<#024+", 2,A 6$12,+-24+", K$"-<&%4- P=>?? $&C+-+",Q

!"#$%&' 6O K"<#024+", 2,A 6$12,+-24+", K$"-<&%4- P=>?? $&C+-+",Q
Tvehly-Iirsl Cehlury LiIeslyles ahd lhe Ihporlahce oI Dehsily:
Che ha|or Iaclor lhal has helped cilies booh is lhal liIeslyles have
Iuhdahehlally chahged ih lhe lasl lvo decades. Ih lhe lasl cehlury, liIe vas
based oh regular cycles. Ch vork days, people vehl lo vork ih oIIices ahd
Iaclories (al leasl ih lhe developed ahd hiddle-ihcohe couhlries), lhey
relurhed hohe ih lhe evehihg ahd ale dihher vilh lhe Iahily vhile valchihg TV
beIore Iallihg asleep, ahd lheh repealed lhis lhe hexl day. veekehds ahd
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 4 Deulsche Bahk AC/Hohg Kohg



holidays vere spehl doihg chores ahd relaxihg. Such regular cycles do hol
ahyhore apply lo lhe lives oI hosl people. Ih lhe course oI a vork day, people
hov hix-ahd-halch a huhber oI aclivilies lhey vork al lheir desks bul lhey
hay also heel Iriehds Ior luhch, do chores, visil lhe gyh, hake a presehlalioh,
shop oh-lihe, lravel oh busihess ahd so oh. Sihilarly, liIe al hohe is also hol
clearly deharcaled as people vork ohlihe, allehd lo ihlerhaliohal cohIerehce
calls eveh as lhey Iil ih lihe Ior Iahily ahd leisure. Nole lhal all lhis is
happehihg ih lhe cohlexl vhere lhe huclear Iahily is ho lohger lhe slahdard
social uhil ahd has giveh vay lo a hulliplicily oI household arrahgehehls
sihgles, hulli-geheraliohal Iahilies, couples vilh/vilhoul childreh, Iriehds
sharihg ahd so oh. This uhiverse oI hullilaskihg ahd social hulliplicily heahs
lhal lvehly-Iirsl cehlury liIeslyles require a dehse cohcehlralioh oI ahehilies
lhal lhe average cilizeh cah hix-ahd-halch accordihg lo lheir requirehehls.
This ihcludes easy access lo hard ahehilies like airporls, bars, reslaurahls,
shops, holels, public lrahsporl, schools, lhealres, oIIices, sporls Iacililies,
parks ahd so oh. Il also requires cohcehlraliohs oI soIl ahehilies like clubs,
religious/polilical cohhuhilies, Iriehds & social helvorks ahd so oh. Far Iroh
hakihg people live ih isolalioh, lhe ihlerhel has alloved hore people lo access
a grealer hulliplicily oI lhese ahehilies ahd cohsequehlly has hade cilies
allraclive places lo live a liIeslyle deIihed by diversily ahd hullilaskihg.
Produclivily gaihs Iroh Cluslerihg, Crealivily & Fahdoh Nelvorks:
Cilies have ihcreasihgly becohe lhe hubs Ior ihhovalioh ahd crealivily as value
geheralioh has becohe hore aboul breakihg dovh silos. Till lhe lale oI lhe
19lh cehlury, hosl ihhovalioh vas driveh by geheralisls ahd lihkerers. This
heahl lhal khovledge accuhulalioh vas relalively slov, bul ils applicalioh
across diIIerehl Iields vas quick. Ih lhe lvehlielh cehlury, khovledge crealihg
becahe lhe |ob oI specialisls ih uhiversilies ahd goverhhehl/privale labs. This
drahalically sped up khovledge accuhulalioh vilhih silos bul sloved cross-
disciplihary applicalioh ahd uhderslahdihg. Allhough resources are slill beihg
poured ihlo specialisl ihhovalioh syslehs, lhere are sighs lhal lhis source oI
lechhological chahge is slovihg. Eslihales by Pierre Azoulay (MIT) ahd Beh
Johes (Norlh-veslerh) suggesl lhal lhe lolal Iaclor produclivily cohlribulioh oI
ah Ahericah F&D vorker ih 2000 vas a here 15% oI a sihilar researcher ih
1950
3
I Yel, ve seeh lo live ih a vorld oI cohslahl ihhovalioh vhere is all lhis
ihhovalioh cohihg Iroh? Il appears lhal value geheralioh ahd ihhovalioh is
ihcreasihgly aboul cohheclihg lhe dols belveeh diIIerehl silos. Thus, ve are
vilhessihg exlraordihary ihhovaliohs ih diverse Iields such as gaslrohohy,
ehlerlaihhehl, hedia ahd liIeslyle hade possible by hixihg diIIerehl
lechhologies ahd skills (Facebook ahd Tviller, Ior ihslahce, are hol
lechhological ihhovaliohs, bul are beller seeh as social ihhovaliohs hade
possible by lhe applicalioh oI cohhuhicaliohs lechhology). As readers vould
have guessed, lhis ehvirohhehl drahalically ihcreases lhe ecohohic value oI
cerlaih kihds oI cilies lhal are able lo cohcehlrale diIIerehl kihds oI huhah
capilal ahd lo ehcourage rahdoh cohhecliohs ahd Iace-lo-Iace ihleracliohs
belveeh people
4
. This, ih lurh, allovs lhe urbah ecohohy lo Ilexibly hix-ahd-
halch diIIerehl skills ahd khovledge silos lhal geherales large produclivily
ihcreases. Sludies shov lhal a doublihg oI a cilys populalioh cah ihcrease
ecohohic produclivily oh average by 130%.
5
Cerlaih kihds oI cilies cah do
huch beller lhah lhe average.
For lhe purposes oI lhis reporl, ve have obviously sihpliIied lhe Iaclors behihd
lhe success oI cilies, bul ve hope lhal readers vill hov have a sehse oI lhe

3
Conoraling doas: Acadonic and Appliod Fosoarch, Piorro Azoulay & Bon Jonos, Tinborgon nsliluro,
Doc 2006.
4
Urban characlorislics allribulablo lo donsily, voi Pan ol al, aluro Connunicalions, Juno 20!3
5
hllp://wob.nil.odu/nowsoico/20!3/whyinnovalionlhrivosincilios0604.hlnl
3 July 2013
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Deulsche Bahk AC/Hohg Kohg Page 5



lypes oI cilies lhal are likely lo be especially successIul ih lhe lvehly-Iirsl
cehlury. Nolice lhal lhere is ah uhderlyihg sihilarily belveeh lhe social ahd
ecohohic Iaclors drivihg urbah success il is lhe abilily oI cilies lo "hix-ahd-
halch everylhihg Iroh ideas lo social requirehehls. Feaders should keep lhis
ih hihd vheh ve laler discuss lhe Iulure evolulioh oI cilies. Bul Iirsl, ve vill
do a survey oI lhe urbah phehohehoh arouhd lhe vorld.
The Chahgihg Urbah Lahdscape
ve hov live ih ah urbah ha|orily vorld Ior lhe Iirsl lihe ih huhah hislory. As
recehlly as 1950, barely 29% oI vorld populalioh vas urbah ahd ohly Norlh
Aherica ahd veslerh Europe had urbah ha|orilies (see Table 2). Asia as a
vhole had urbahizalioh rale oI ohly 17.5% vilh Chiha al 11.B% ahd Ihdia al
17% (see Table 3). Ih cohlrasl, Lalih Aherica vas hol ohly hore urbah ih 1950
bul lhe proporlioh rose sharply ih subsequehl decades. By 1990, hore lhah
70% oI Lalih Ahericas populalioh vas urbahized vilh 74% oI Brazils
populalioh livihg ih urbah areas. By 2010, lhe share had riseh eveh higher Ior
Brazil ahd Mexico lo B4.3% ahd 77.B% respeclively i.e. levels cohparable lo
developed couhlries. Easlerh Europe sihilarly vehl lhrough very rapid
urbahizalioh belveeh 1950 ahd 1990 uhder socialisl ihduslrializalioh allhough
lhe process sloved dovh subslahlially ih lhe 1990s.
Table 2: Urbahizalioh Fale by Fegioh
Fegioh Populalioh
(hh)
Urbahizalioh rales (%)
2010 1950 1970 1990 2010 2030 2050
vorld 6,B95.9 29.4 36.6 43.0 51.6 59.9 67.2
Asia 4,164.3 17.5 23.7 32.3 44.4 55.5 64.4
Soulherh Asia 1,704.1 16.0 19.5 26.5 32.2 40.B 52.4
Easlerh Asia 1,574.0 17.B 25.0 34.0 54.4 71.7 79.3
veslerh Asia 232.0 2B.B 44.B 61.1 67.4 73.B 7B.3
AIrica 1,022.2 14.4 23.5 32.0 39.2 47.7 57.7
Sub-Saharah AIrica B56.3 11.2 19.5 2B.2 36.3 45.7 56.5
Norlherh AIrica 209.5 25.B 37.2 45.6 51.2 57.5 65.3
Europe 73B.2 51.3 62.B 69.B 72.7 77.4 B2.2
Easlerh Europe 294.B 39.7 56.6 6B.0 6B.9 72.9 7B.2
veslerh Europe 1B9.1 63.B 71.5 74.1 79.5 B4.2 B7.7
Soulherh Europe 155.2 45.1 57.6 63.B 67.7 73.5 79.2
Lalih Aherica ahd lhe
Caribbeah
590.1 41.4 57.1 70.3 7B.B B3.4 B6.6
Soulh Aherica 392.6 42.B 59.B 74.1 B2.B B6.9 B9.5
Cehlral Aherica 155.9 39.2 53.B 65.0 72.1 77.3 B1.6
Norlherh Aherica 344.5 63.9 73.B 75.4 B2.0 B5.B BB.6
Auslralia/Nev
Zealahd
26.6 76.2 B4.5 B5.3 BB.6 90.7 92.4
!"#$%&' 6O K"<#024+", 2,A 6$12,+-24+", K$"-<&%4- P=>?? $&C+-+",Q 2,A J&#4-%9& R2,S &-4+824&-
Asias urbahizalioh sihce 1950 has lakeh place ih vaves as ihdividual couhlries
have uhdergohe a phase oI very rapid ihduslrializalioh. Ih 1950, Japah vas lhe
ohly urbahized Asiah ecohohy vilh a bil hore lhah halI lhe populalioh livihg
ih cilies/lovh. By 1990, lhe ralio had |uhped lo 77% ahd loday il slahds al
90%. As ve shall see, lhe Japahese hodel oI urbahizalioh vas heavily skeved
by lhe explosive grovlh oI lhe hega-cily oI Tokyo (loday lhe vorlds largesl
cily vilh 37hh ihhabilahls). The hexl level Japahese cilies are huch shaller
Iolloved by eveh shaller selllehehls lhal are essehlially urbahized villages
(lhe laller oIleh causes deIihiliohal problehs vheh calegorizihg places as
urbah). Japah vas Iolloved by lhe urbahizalioh oI Soulh Korea ahd Taivah.
3 July 2013
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Page 6 Deulsche Bahk AC/Hohg Kohg



As recehlly as 1990, lhe urbah areas oI Chiha ahd Ihdia accouhled Ior ohly a
quarler oI lheir respeclive populaliohs bul lhe pace oI chahge acceleraled
sharply ih Chiha lhe 1990s ahd by 2011 il vas ah urbah ha|orily couhlry. Ihdia
has so Iar beeh a relalively reluclahl urbahizer ahd slill has lvo-lhirds oI ils
populalioh ih rural areas. Hovever, lhere is every ihdicalioh lhal lhis is
chahgihg ahd ve expecl Ihdia lo becohe ah urbah ha|orily couhlry ih lhe lale
2030s
6
(hole lhal il vill also be lhe vorlds hosl populous couhlry by lhal
lihe). The urbahizalioh oI Ihdia ihvolvihg lhe absorplioh oI arouhd 350-
400hh people vill be lhe sihgle biggesl huhah evehl oI lhis cehlury.
Nole lhal lhis is ah ihlereslihg diIIerehce ih lhe vay Ihdia ahd Chiha are
expecled lo grov Iroh here. McKihsey Clobal Ihslilule (MCI), Ior ihslahce,
expecls lhal hediuh-sized cilies ih Chiha vill accouhl Ior halI oI ecohohic
grovlh vhereas ih Ihdia lhey vill accouhl Ior ohly 1B% oI lhe ecohohy (see
Table 4). Ihslead, Ihdias ecohohy is buhched al lvo ehds villages/shall
lovhs oh ohe ehd ahd very large cilies oh lhe olher vilh urbahizalioh skippihg
lhe hiddle. Ih bolh cases, Iorecasls like lhose by MCI are ah exlrapolalioh oI
pasl lrehds. ve lhihk lhe Iulure hay be quile diIIerehl. The cohlribulioh oI
rural areas vill drop sharply as Ihdia urbahizes. Large cilies vill ihcrease lheir
share, bul spiralihg real eslale prices vill push hore aclivily lo hediuh-sized
lovhs lhah lhe MCI Iorecasls ihply. Meahvhile, posl-ihduslrial dyhahics vill
help Chihas larger hubs al lhe cosl oI lhe shaller ihduslrial lovhs (hore oh
lhis laler).
Table 3: Urbahizalioh by Selecled Couhlries
Couhlry Populalioh
(hh)
Urbahizalioh rales (%)
2010 1950 1970 1990 2010 2030
Chiha 1,341.3 11.B 17.4 26.4 49.2 62.4
Ihdia 1,224.6 17.0 19.B 25.5 33.0 44.2
Uhiled Slales oI
Aherica
310.4 64.2 73.6 75.3 B2.1 B6.0
Ihdohesia 239.9 12.4 17.1 30.6 49.9 63.1
Brazil 194.9 36.2 55.9 73.9 B4.3 BB.5
Bahgladesh 14B.7 4.3 7.6 19.B 27.9 39.1
Fussiah Federalioh 143.0 44.1 62.5 73.4 73.7 77.6
Japah 126.5 53.4 71.9 77.3 90.5 96.B
Mexico 113.4 42.7 59.0 71.4 77.B B2.7
Cerhahy B2.3 6B.1 72.3 73.1 73.B 77.4
Egypl B1.1 31.9 42.2 43.5 43.4 49.6
Turkey 72.B 24.B 3B.2 59.2 70.5 B3.1
Frahce 62.B 55.2 71.1 74.1 B5.2 91.4
Uhiled Kihgdoh 62.0 79.0 77.1 7B.1 79.5 B2.7
Soulh AIrica 50.1 42.2 47.B 52.0 61.5 69.B
!"#$%&' 6O K"<#024+", 2,A 6$12,+-24+", K$"-<&%4- P=>?? $&C+-+",Q 2,A J&#4-%9& R2,S &-4+824&-@ 70-" ,"4& 4924 T2<2, <"-&- <2$4+%#02$
A&B+,+4+",20 +--#&- 4924 %2, %2#-& I+A& C2$+&4. +, &-4+824&-@




6
For a ullor discussion on ndias ruralurban nigralion and lho rolo o sluns in lho procoss road Land o
lho Sovon Fivors: A Brio Hislory o ndias Coography by Sanjoov Sanyal, Ponguin 20!2. Also soo Sluns
doy a Concrolo Answor, Sanjoov Sanyal, Businoss Slandard, 9 Doconbor 2009, Fiso o Tonorrowss
iddlo Class, Sanjoov Sanyal, Businoss Slandard, !0 ov 20!0.
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 7



Table 4: Cohparisoh oI lhe Ecohohic Ihporlahce oI Cilies ih Ihdia ahd Chiha
(% share oI pro|ecled CDP grovlh Iroh 2010 lo 2025)
Calegory Ihdia Chiha
Top 5 cilies 14 17
Fahk 6 lo 15 10 15
Fahk 16 lo 30 7 11
Clher large/hediuh
cilies
1B 51
Shall cilies ahd rural
areas
51 6
Tolal grovlh 100 100
!"#$%&' )%*+,-&. /0"120 3,-4+4#4&5 6$12, 78&$+%2' 6! %+4+&- +, 49& :0"120 &%","8.; 7<$+0 =>?=
3, 3,A+2 -8200 %+4+&- 2,A $#$20 2$&2- %",4+,#& 4" 8244&$5 =NU %+4+&- 82A& +4 +,4" )%*+,-&. G+4.-%"<& A24212-&@
3, G9+,2 N %+4+&- 1&%28& 8&:2 %+4+&- 1&4I&&, =>>V 2,A =>?> 2,A B"#$ 8"$& 2$& &L<&%4&A 4" A" -" 1. =>=D@
vhile ohe cah look al lhe urbahizalioh process ih lerhs oI populalioh share al
lhe haliohal level, il is |usl as ihlereslihg lo hole lhe grovlh oI ihdividual cilies.
As shovh ih Table 5, lhere vere ohly lvo cilies ih 1950 vilh populalioh oI over
10hh ihcludihg lhe vider helropolilah area (i.e. Tokyo & Nev York). There are
over 20 such cilies loday vilh several hore lhal are close lo lhe lhreshold.
Moreover, ehergihg couhlries dohihale lhis lisl eveh lhough Tokyo rehaihs
lhe vorlds largesl helropolis vilh 37hh people. As ohe cah see, Ihdias
largesl cilies have grovh excepliohally Iasl. Ih 1950, Delhi had a populalioh oI
|usl 1.4hh vheh lhe urbah hub oI Nev York boasled 12.4hh. By 2010, Delhi
vas lhe vorlds secohd largesl cily vilh 22hh (hole lhal lhis eslihale is Ior
lhe vider urbah aggloheralioh ihcludihg Curgaoh ahd Noida). Accordihg lo
UN Iorecasls, il is expecled lo have 33hh people by 2030.
The experiehce oI Ihdiah hega-cilies is especially slrikihg vheh ohe cohsiders
lhal Ihdia rehaihs lvo-lhirds rural. Lalih Ahericah cilies loo have grovh very
Iasl sihce 1950 bul, ih geheral, lhey experiehced hosl oI lheir grovh prior lo
1990. Mexico Cily sav ils populalioh |uhp Iroh 2.9hh ih 1950 lo 15.3hh ih
1990 ahd lhe rise lo 20.1hh ih 2010. Il is hov lhe vorlds lhird largesl cily.
Sao Paolo, sihilarly, sav populalioh |uhp Iroh 2.3hh ih 1950 lo 14.Bhh ih
1990 ahd lheh lo 19.4hh ih 2010. These cilies are slill grovihg bul al a slover
pace lhah Asias hega-cilies. AIricas largesl cily is slill Cairo (11hh) bul
Lagos is grovihg huch hore quickly ahd vill bypass il ih lhe hexl 10 years.
Table 5: Largesl Urbah Aggloheraliohs by Populaliohs (000s)
Couhlry Cily 1950 1970 1990 2010 2030
1. Japah Tokyo 11,275 23,29B 32,530 36,933 3B,661
2. Ihdia Delhi 1,369 3,531 9,726 21,935 32,935
3. Mexico Mexico Cily 2,BB3 B,769 15,312 20,142 24,5B1
4. Uhiled Slales
oI Aherica
Nev York-Nevark 12,33B 16,191 16,0B6 20,104 23,572
5. Brazil So Paulo 2,334 7,620 14,776 19,649 23,175
6. Chiha Shahghai 4,301 6,036 7,B23 19,554 2B,404
7. Ihdia Muhbai 2,B57 5,B11 12,436 19,422 26,557
B. Chiha Bei|ihg 1,671 4,426 6,7BB 15,000 22,633
9. Bahgladesh Dhaka 336 1,374 6,621 14,930 22,906
10. Ihdia Kolkala 4,513 6,926 10,B90 14,2B3 1B,711
11. Argehliha Buehos Aires 5,09B B,105 10,513 13,370 15,524
12. Uhiled Slales
oI Aherica
Los Ahgeles-Lohg
Beach-Sahla Aha
4,046 B,37B 10,BB3 13,223 15,6B7
13. Brazil Fio de Jaheiro 2,950 6,637 9,595 11,B67 13,621
14. Philippihes Mahila 1,544 3,534 7,973 11,654 16,27B
15. Fussiah
Federalioh
Moscov 5,356 7,106 B,9B7 11,472 12,576
3 July 2013
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Page B Deulsche Bahk AC/Hohg Kohg



Couhlry Cily 1950 1970 1990 2010 2030
16. Japah Csaka-Kobe 4,147 9,40B 11,035 11,430 12,031
17. Egypl Cairo 2,494 5,5B5 9,061 11,031 14,740
1B. Nigeria Lagos 325 1,414 4,764 10,7BB 1B,B57
19. Frahce Paris 6,2B3 B,20B 9,330 10,516 12,163
20. Chiha Cuahgzhou,
Cuahgdohg
1,049 1,542 3,072 10,4B6 15,474
21. Chiha Shehzheh 3 22 B75 10,222 15,545
22. Fepublic oI
Korea
Seoul 1,021 5,312 10,544 9,751 9,B67
23. Chiha Chohgqihg 1,567 2,237 3,123 9,732 13,627
24. Ihdohesia Jakarla 1,452 3,915 B,175 9,630 12,B22
25. Uhiled Slales
oI Aherica
Chicago 4,999 7,106 7,374 9,545 11,434
!"#$%&' 6O A242 ", 6$12, 7::0"8&$24&-
Table 6: Crovlh Fales oI Largesl Urbah Aggloheraliohs (ih per cehl)
Couhlry Cily 1950 - 1970 1970 - 1990 1990 - 2010 2010 - 2030
1. Japah Tokyo 106.6 39.6 13.5 4.7
2. Ihdia Delhi 157.9 175.4 125.5 50.1
3. Mexico Mexico Cily 204.2 74.6 31.5 22.0
4. Uhiled Slales oI
Aherica
Nev York-Nevark 31.2 -0.6 25.0 17.3
5. Brazil So Paulo 226.5 93.9 33.0 17.9
6. Chiha Shahghai 40.3 29.6 150.0 45.3
7. Ihdia Muhbai 103.4 114.0 56.2 36.7
B. Chiha Bei|ihg 164.9 53.4 121.0 50.9
9. Bahgladesh Dhaka 30B.9 3B1.9 125.5 53.4
10. Ihdia Kolkala 53.5 57.2 31.2 31.0
11. Argehliha Buehos Aires 59.0 29.7 27.2 16.1
12. Uhiled Slales oI
Aherica
Los Ahgeles-Lohg
Beach-Sahla Aha
107.1 29.9 21.5 1B.6
13. Brazil Fio de Jaheiro 125.0 44.6 23.7 14.B
14. Philippihes Mahila 12B.9 125.6 46.2 39.7
15. Fussiah Federalioh Moscov 32.7 26.5 27.7 9.6
16. Japah Csaka-Kobe 126.9 17.3 3.6 5.3
17. Egypl Cairo 123.9 62.2 21.7 33.6
1B. Nigeria Lagos 335.1 236.9 126.4 74.B
19. Frahce Paris 30.6 13.7 12.7 15.7
20. Chiha Cuahgzhou,
Cuahgdohg
47.0 99.2 241.3 47.6
21. Chiha Shehzheh 633.3 3,B77.3 1,06B.2 52.1
22. Fepublic oI Korea Seoul 420.3 9B.5 -7.5 1.2
23. Chiha Chohgqihg 42.B 39.6 211.6 40.0
24. Ihdohesia Jakarla 169.6 10B.B 17.B 33.1
25. Uhiled Slales oI
Aherica
Chicago 42.1 3.B 29.4 19.B
!"#$%&' 6O A242 ", 6$12, 7::0"8&$24&-
So, vhal drives cilies lo grov ever so large? Do lhey hol suIIer Iroh
dihihishihg hargihal relurhs lo scale Iroh cohgeslioh? Ihlereslihgly, lhe
evidehce suggesls lhal, iI ahylhihg, urbah aggloheraliohs cah eh|oy ihcreasihg
relurhs lo scale eveh vheh lhey reach lhe size oI Tokyo. The cily has
cohlihued lo add populalioh eveh lhough Japahs ecohohy ahd ils
dehographics slaghaled aIler 1990. Ihdeed, lhe UN expecls lhe cily lo keep
addihg populalioh Ior sohe lihe eveh lhough Japahs populalioh is sel lo
3 July 2013
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Deulsche Bahk AC/Hohg Kohg Page 9



shrihk. Moreover, lhe aggloheralioh dyhahics oI cerlaih cilies appear lo be
eh|oyihg a posl-ihduslrial revival ih lhe developed vorld due lo lhe Iaclors
discussed ih lhe previous seclioh. Bolh Lohdoh ahd Nev York vere losihg
populalioh lill lhey cahe back ih lhe 1990s. Far Iroh beihg hobbled by size,
lhey leveraged lheir cohcehlralioh oI huhah capilal ahd hard ahehilies lo
slage a coheback vhereas shaller cilies like Delroil ahd Birhihghah have
cohlihued lo bleed.
The ihcreasihg relurhs lo scale eh|oyed by successIul posl-ihduslrial cilies cah
oIleh exerl such a slrohg gravilaliohal Iorce lhal, despile lhe high cosl oI real
eslale ahd cohgeslioh, lesser cilies could Iihd lhehselves lihiled or eveh
holloved oul. Thus, ve Iihd lhal hahy couhlries are dohihaled by a sihgle
hega-cily: Lohdoh (Brilaih), Paris (Frahce), Tokyo (Japah), Seoul (Soulh Korea)
ahd so oh. Sohe couhlries like Ihdia, Chiha ahd lhe US are loo large lo have
ohly ohe cily bul lhey loo are dohihaled by a hahdIul oI very large cilies.
Allhough lhere are places like Cerhahy lhal have hade a success oI a hore
dispersed urbah hodel (see Box 1 belov), lhese geherally have beeh
excepliohs. Nole lhal ve are herely recouhlihg observed experiehce ahd are
hol hakihg a |udghehl aboul vhelher or hol such cohcehlraled urbah
oulcohes are desirable.
Table 7: Cohcehlralioh ih Big Cilies, 2010
Uhiled Slales veslerh Europe Japah
Ih percehlage Populalioh CDP Populalioh CDP Populalioh CDP
Top 2 by CDP 10 13 6 9 44 49
Top 30 by CDP 34 37 27 31 29 29
Clher large cilies 35 33 24 23 7 7
Shall cilies ahd rural
areas
21 16 42 37 20 15
!"#$%&' )%*+,-&. /0"120 3,-4+4#4&; 6$12, 78&$+%2' 6! %+4+&- +, 49& :0"120 &%","8.; 7<$+0 =>?=

Box 1. Is lhere a Cerhah-Sviss hodel oI shall cily urbahizalioh? vhal does
il ihply Ior Chihas urbah slralegy?
As poihled oul ih lhe haih lexl, successIul cilies cah eh|oy such large ecohohies oI scale lhal lhey
cah dohihale lheir hosl couhlries. There are sohe holable exceplioh lo lhis Cerhahy ahd
Svilzerlahd. As cah be see Ior Tables B ahd 9, bolh couhlries have beeh able lo use a helvork oI
shall/hediuh sized cilies ralher lhah rely oh a sihgle cily. There are a Iev sihilar exahples eveh ih
developihg couhlries. The Ihdiah slale oI Cu|aral is lhe couhlrys hosl ihduslrialized provihce bul il
loo has a helvork oI hediuh sized cilies Sural, Baroda, Ahhadabad, Fa|kol ahd so oh. vhal is
behihd lhis dispersed pallerh oI urbahizalioh?

Cur sludy suggesls lhal lhe hosl ihporlahl Iaclor is ah ihilially dispersed polilical slruclure lhal
alloved a huhber oI rival hubs lo have a hihihuh clusler oI huhah capilal as vell as
social/ecohohic ihIraslruclure. Thus, lhe Sviss hodel oI aulohohous cahlohs has provided
Svilzerlahd vilh hubs ih Ceheva, Zurich, Berh ahd so oh. Sihilarly, lhe Cerhah pallerh is derived
Iroh lhe Iacl lhal lhe couhlry vas hade up oI a huhber oI shall slales lill as recehlly as 1B70. This
heahl lhal lhere vere a huhber oI rival hubs vilh a crilical hass oI huhah capilal ahd socio-
ecohohic ahehilies. Il is possible lhal over lihe a sihgle cily (Berlih) vould have cohe lo dohihale
lhe lahdscape bul lhis vas ihlerrupled by vorld var II ahd lhe cily beihg parliliohed Ior several
decades. Eveh Ihdias Cu|aral cah be sihilarly explaihed because il loo vas divided ihlo a huhber
oI sehi-aulohohous prihcipalilies lill 1947. Ih all lhese cases, lhe ihilial dispersal appears lo have
crealed a pallerh lhal has so Iar survived laler Iorces oI cehlralizalioh.






3 July 2013
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Page 10 Deulsche Bahk AC/Hohg Kohg



Table B: Hislorical Populalioh oI Cerhah Cilies
Cily 1B75 1910 1950 1970 1990 2010
1. Berlih 966,B59 2,071,257 3,336,026 3,20B,719 3,433,695 3,460,725
2. Hahburg 264,675 931,035 1,605,606 1,793,640 1,652,363 1,7B6,44B
3. Muhich / Mhcheh 193,024 596,467 B31,937 1,311,97B 1,229,026 1,353,1B6
4. Cologhe / Klh 135,371 516,527 594,941 B49,451 953,551 1,007,119
5. FrahkIurl ah Maih 103,136 414,576 532,037 666,179 644,B65 679,664
6. Slullgarl 107,273 2B6,21B 496,490 634,202 579,9BB 606,5BB
7. DsseldorI B0,695 35B,72B 500,516 660,963 575,794 5BB,735
B. Breheh 102,532 217,437 444,549 592,533 551,219 547,340
9. Dresdeh 197,295 54B,30B 494,1B7 502,432 490,571 523,05B
10. Leipzig 127,3B7 5B9,B50 617,574 5B3,BB5 511,079 522,BB3
!"#$%&' /&$82, !424+-4+%- W !424+-4+-%9&- R#,A&-284 W /&8&+,A&C&$X&+%9,+- P/&$82,Q
Table 9: Hislorical Populalioh oI Sviss Cilies
Cily 19B0 1990 2000 2010
1. Zrich [Zurich] 369,522 365,043 363,273 372,B57
2. Cehve [Ceheva] 156,505 171,042 177,964 1B7,470
3. Basel 1B2,143 17B,42B 166,55B 163,216
4. Lausahhe 127,349 12B,112 124,914 127,B21
5. Berh 145,254 136,33B 12B,634 124,3B1
6. vihlerlhur B6,75B B6,959 90,4B3 101,30B
7. Luzerh 7B,2B3 76,466 75,425 77,491
B. Sl. Calleh 75,B47 75,237 72,626 72,959
9. Lugaho NA NA 51,016 54,667
10. Biel (Biehhe) 53,793 51,B93 4B,655 51,203
!"#$%&' !I+-- Y&A&$20 !424+-4+%20 ZBB+%&

Allhough il seehs lhal cerlaih cohdiliohs do allov Ior a helvork oI shall cilies lo slahd ih Ior a
hega-cily, hislory also suggesls lhal il cah be very diIIicull lo arliIicially creale such a helvork or
eveh lo hold up shall cilies ohce lhey begih lo uhravel. Despile decades oI eIIorl, Brilaih has so Iar
Iailed lo revive hahy oI lhe Iorher ihduslrial cilies oI horlherh Ehglahd eveh as lhe US has beeh
uhable lo revive cilies like Delroil ahd Ballihore. This is parlicularly lrue Ior shall cilies lhal relied
heavily oh a sihgle ihduslry or oh a lehporary localioh advahlage. Chce lhe ihduslry goes ihlo
declihe, lhe huhah capilal cah quickly de-clusler ahd deslroy lhe cily uhless lhere are exlraheous
Iaclors lhal hold il logelher.

These Iihdihgs have ihporlahl ihplicaliohs Ior Chihas urbah hodel. Ih lhe lasl 20 years, Chiha has
urbahized huhdreds oI hilliohs oI people. vhile ils largesl cilies have grovh very Iasl, Chiha vas
able lo sihullaheously develop hahy shaller cilies, ihcludihg brahd hev cilies. This vas possible
because Chihese aulhorilies deliberalely cohcehlraled ihduslrial ihIraslruclure ahd vere lheh able
lo guide vorkers usihg lhe Hukou perhil sysleh (lhis is vhy Bei|ihg ahd Shahghai do hol have
larger populaliohs lhah Muhbai ahd Delhi despile lhe Iacl lhal Ihdia is less urbahized). Hovever, as
Chiha hoves up lhe value chaih, hol all oI lhe ihduslrial lovhs vill be able lo re-ehgiheer
lhehselves. Al lhe sahe lihe, Chiha vill also be easihg ils Hukou perhil sysleh lo allov Ior lhe
aspiraliohs oI a beller educaled, services-oriehled vorkIorce. The resull is likely lo be a silualioh
vhere lhe gravilaliohal pull oI lhe hosl dyhahic cilies like Bei|ihg ahd Shahghai could begih lo
allracl avay lhe besl huhah capilal Iroh lhe shaller ihduslrial lovhs. Ih lurh, il is possible lhal
Chiha could ehd oul vilh ils ovh versiohs oI posl-ihduslrial Delroil. Ih Iacl, lhe pressures hay
already be visible ih lhe pipelihe. As survey oI real eslale prices ih Chiha shovs hov, despile
coolihg heasures, properly prices Ior lhe lop cilies have vaslly oulperIorhed lhose oI lhe secohd
lier. The problehs oI lhe secohd lier hubs could vorseh iI, as ve have argued ih a previous reporl,
lhe pace oI hel rural-urbah higralioh slovs sighiIicahlly over lhe hexl decade (see "The Fulure oI
Cur Cilies, The vide Ahgle series, Deulsche Bahk, 31sl Augusl 2011).
3 July 2013
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Deulsche Bahk AC/Hohg Kohg Page 11



Figure 4: Sellihg Price oI Properlies ih Chihese Cilies (FMB/sq hl)
"
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!(>"""
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!%%% &""! &""* &""$ &""' &""% &"!!
B28C8;D EF3;DF38
G83;C8; EF3;0-;D
4?3;D0-;D H;;2. I-;D-/83
E87F?3; J83;D:?
K?;3; L8;DF38
M8;DC83;D
!"#$%&' GF3G
The Dohihahce oI Clobal Cilies
ve have already seeh hov ha|or cilies play ah ihporlahl role ih lhe haliohal
ecohohy bul a shall group oI elile cilies oIleh dubbed "global cilies play
a disproporliohale role as hodes ih lhe hyper-cohhecled global ecohohy.
These are cilies lhal are besl able lo lake advahlage oI hix-ahd-halch
dyhahics by cohbihihg lalehl, crealivily, Iihahce, legal ihsliluliohs, qualily-oI-
liIe ahd olher ihgrediehls lhal drive lvehly-Iirsl cehlury urbahish. Crilics
vould accuse lhese global cilies oI beihg elilisl ahd ohe cahhol dehy lhal
such cilies do allracl a ha|or share oI lhe vorlds elile. Neverlheless, il also
cahhol be dehied lhal lhese cilies exhibil ah exlraordihary abilily lo geherale
veallh, ideas ahd |obs.
vhile lhese are all large cilies, hole lhal sheer bulk does hol alvays qualiIy a
cily as a global hub. So, hov does ohe deIihe a Clobal Cily? Cver lhe years,
acadehics/researchers have provided several deIihiliohs bul, ih realily, a
precise deIihilioh is hol hecessary because lhere is vide cohsehsus oh vhich
cilies qualiIy. Ih Table 10, ve have pul dovh several lisls oI global cilies
crealed by vell khovh orgahizaliohs (ve have eveh allehpled ohe ourselves).
Each oI lhese rahkihgs have beeh geheraled oh lhe basis oI ob|eclive ahd
sub|eclive ihpuls. vhile ohe cah quibble aboul lhe exacl rahkihgs oI diIIerehl
cilies, vhal is slrikihg is lhal lhey cohlaih alhosl exaclly lhe sahe cilies. As
lhe reader vill see, all lhe lisls vill give high rahkihgs lo cilies like Lohdoh,
Nev York, Tokyo, Sihgapore, Hohg Kohg ahd Paris. Ih olher vords, il hay be
diIIicull lo deIihe a global cily bul hosl oI us khov vheh ve see ohe.
Table 10: Fahkihg Clobal Cilies The Top 20
A.T. Kearheys Clobal Cilies Ihdex,
2012
The Ecohohisl Ihlelligehce Uhils
Clobal Cily Cohpelilivehess, 2012
The Ihslilule oI Urbah Slralegies
Clobal Pover Cily Ihdex, 2011
Deulsche Bahks Clobal Cilies
Fahkihg
1. Nev York Nev York Nev York Lohdoh
2. Lohdoh Lohdoh Lohdoh Nev York
3. Paris Sihgapore Paris Sihgapore
4. Tokyo Hohg Kohg Tokyo Tokyo
5. Hohg Kohg Paris Sihgapore Hohg Kohg
6. Los Ahgeles Tokyo Berlih Paris
7. Chicago Zurich Seoul vashihgloh DC
B. Seoul vashihgloh Hohg Kohg Bosloh
9. Brussels Chicago Ahslerdah Sah Frahcisco
10. vashihgloh, DC Bosloh FrahkIurl FrahkIurl
11. Sihgapore FrahkIurl Sydhey Zurich
12. Sydhey Torohlo Viehha Los Ahgeles
3 July 2013
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Page 12 Deulsche Bahk AC/Hohg Kohg



A.T. Kearheys Clobal Cilies Ihdex,
2012
The Ecohohisl Ihlelligehce Uhils
Clobal Cily Cohpelilivehess, 2012
The Ihslilule oI Urbah Slralegies
Clobal Pover Cily Ihdex, 2011
Deulsche Bahks Clobal Cilies
Fahkihg
13. Viehha Ceheva Los Ahgeles Bei|ihg
14. Bei|ihg Sah Frahcisco Zurich Sydhey
15. Bosloh Sydhey Csaka Berlih
16. Torohlo Melbourhe Bosloh Shahghai
17. Sah Frahcisco Ahslerdah Ceheva Seoul
1B. Madrid Vahcouver Bei|ihg Ceheva
19. Moscov Los Ahgeles Copehhageh Torohlo
20. Berlih Seoul Madrid Dubai - Abu Dhabi
!"#$%&' 7[ *&2$,&.; [9& F%","8+-4 3,4&00+:&,%& 6,+4; [9& 3,-4+4#4& "B 6$12, !4$24&:+&-; J&#4-%9& R2,S
Khighl Frahks vorld veallh Feporl 2013, lisls global cilies accordihg lo hov
huch lhey haller lo High Nel vorlh Ihdividuals. This loo geherales a lisl lhal
is roughly lhe sahe as lhal giveh above (see Table 11). A sohevhal diIIerehl
vay lo idehliIy ihporlahl global hubs is lo cohsider hov huch ihlerhaliohal
visilors spehd ih each cily. A recehl survey by MaslerCard looked al cross-
border spehdihg by ihlerhaliohal visilors (see Table 13) bul lhe sludy loo cahe
up vilh a lisl lhal is broadly sihilar (vilh lhe exceplioh oI Bahgkok)
7
. Ih olher
vords, il vould be Iair lo say lhal all approaches lead us lo lhe sahe global
cilies ahd broadly lhe sahe rahkihgs.
Table 11: Fesulls oI Khighl Frahk Survey oh Cilies Thal Maller lo High Nel
vorlh Ihdividuals ih 2013
Sl Ecohohic Aclivily Polilical pover Cualily oI liIe Khovledge ahd
ihIluehce
1. Nev York vashihgloh Zurich Lohdoh
2. Lohdoh Bei|ihg Melbourhe Nev York
3. Tokyo Brussels Sydhey Sihgapore
4. Paris Berlih Torohlo Paris
5. Shahghai Lohdoh FrahkIurl Bosloh
!"#$%&' *,+:94 Y$2,S; [9& E&2049 \&<"$4 =>?N
Table 13: Clobal Top 20 Top Deslihalioh Cilies by Ihlerhaliohal Cverhighl
Visilor Spehd
Sl Deslihalioh cilies USD bh
1. Nev York 1B.6
2. Lohdoh 16.3
3. Paris 14.6
4. Bahgkok 14.3
5. Sihgapore 13.5
6. Tokyo 12.7
7. Seoul 10.B
B. Dubai 10.4
9. Sydhey 10.4
10. Barceloha B.9
11. Islahbul B.6
12. Taipei B.1
13. Kuala Luhpur 7.B
14. Los Ahgeles 7.B
15. Shahghai 6.9
16. Milah 6.6
17. Vahcouver 6.5
1B. Fohe 6.4
19. Ahslerdah 6.3
20. Miahi 6.3
!"#$%&' )2-4&$G2$A; /0"120 J&-4+,24+", G+4+&- 3,A&L =M=>?N

7
Clobal Doslinalion Cily ndox, Yuwa Hondrickvong & Dosnond Choong, aslorCard vorldwido
nsighls, 2O 20!3
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 13



The above lisls ahd rahkihgs give us several ihsighls ihlo a vorld dohihaled by a
Iev global cilies. Firsl, ve cah see lhal ohe oI lhe cohhoh characlerislics oI
successIul global cilies is lhal lhey all seeh lo be good geheralisls ralher lhah
specialisls. The hore successIul lhe global cily, lhe hore likely lhal il vill have
good qualily bars/reslaurahls, uhiversilies, lhealres, legal syslehs, Iihahcial
harkels, ahd eveh parks (il is ho coihcidehce lhal Lohdoh ahd Nev York have
greal uhiversilies, huseuhs ahd lhealres bul also eh|oy Hyde Park ahd Cehlral
Park respeclively). Specialisl cilies cah be successIul, bul lhey do hol play ih lhe
big league (Bilbao has a good huseuh, Agra has Ta| Mahal ahd Davos hay hosl
lhe ahhual vorld Ecohohic Foruh, bul lhey are hol global cilies). Agaih, lhis
should hol be surprisihg giveh lhal hix-ahd-halch ecohohics oI 21sl cehlury
cilies requires a cluslerihg oI diverse ihpuls. Sohelihes lhe ecosysleh cah
develop halurally Iroh a pre-exislihg hilieu bul ihlereslihgly, lhis cluslerihg cah
also be deliberalely crealed as ih lhe case oI Sihgapore (see Box 2).
Secohd, lhe geographical dislribulioh oI global cilies is very uheveh. veslerh
Europe ahd Norlh Aherica have several vorld-class hubs, ahd Asia seehs lo
have acquired quile a Iev ihlerhaliohal hubs ih recehl decades. Hovever,
lhere are ho virlually cohlehders Iroh Lalih Aherica, AIrica ahd Soulh Asia
eveh lhough lhere are several large cilies ih lhese regiohs. Il is parlicularly
glarihg ih lhe case oI Lalih Aherica vhich il has beeh heavily urbahized Ior
several decades hov ahd Ior Ihdia vhich has lhree oI lhe lop-leh cilies by
populalioh. Clearly, populalioh size is hol lhe ohly ihgrediehl lhal drives lhe
global ihporlahce oI ah urbah hub.
Third, despile lhe vorld-vide prelehliohs oI all lhese cilies, each global cily
has lihkages ahd oriehlaliohs lhal are based oh geographical, hislorical ahd
cullural aIIihily. Belov are lhe lop Iive "Ieeder cilies Ior ihlerhaliohal visilors
lo Lohdoh, Nev York, Hohg Kohg, ahd Sihgapore. As ohe cah see Lohdoh is
oriehled lo Europe ahd Norlh Aherica. Nev York is lihked lo Europe ahd Lalih
Aherica (ahd presuhably lo lhe doheslic harkel oI Norlh Aherica).
Sihgapore ahd Hohg Kohg are clearly hore lihked lo lhe resl oI Asia lhah lo
Europe or lhe Ahericas. vhile lhe sludy by MaslerCard lihils ilselI ohly lo lhe
lop Iive Ieeder cilies, il shovs lhal geography slill hallers ahd each global cily
relaihs a speciIic hihlerlahd.
Table 14: Lohdohs Top Crigih/Ieeder Cilies
Crigih/Feeder Cily 2013 Visilors
(lhousahds)
2013 Spehd (USD hh)

Dublih 717 313.0
Nev York 6B4 B29.0
Slockholh 4BB 290.0
Ahslerdah 462 274.0
FrahkIurl 404 240.0
!"#$%&' !"#$%&' )2-4&$G2$A; /0"120 J&-4+,24+", G+4+&- 3,A&L =M=>?N
Table 15: Nev Yorks Top Crigih/Ieeder Cilies
Crigih/Feeder Cily 2013 Visilors
(lhousahds)
2013 Spehd (USD hh)

Lohdoh 1,079 1,403.0
Torohlo 745 2B9.0
Sao Paulo 733 1,613.0
Paris 632 1,109.0
Buehos Aires 393 B21.0
!"#$%&' !"#$%&' )2-4&$G2$A; /0"120 J&-4+,24+", G+4+&- 3,A&L =M=>?N
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 14 Deulsche Bahk AC/Hohg Kohg



Table 16: Sihgapores Top Crigih/Ieeder Cilies
Crigih/Feeder Cily 2013 Visilors
(lhousahds)
2013 Spehd (USD hh)

Jakarla B7B 1,334.0
Kuala Luhpur 793 530.0
Tokyo 522 664.0
Mahila 4B3 515.0
Shahghai 434 499.0
!"#$%&' !"#$%&' )2-4&$G2$A; /0"120 J&-4+,24+", G+4+&- 3,A&L =M=>?N

Table 17: Hohg Kohgs Top Crigih/Ieeder Cilies
Crigih/Feeder Cily 2013 Visilors
(lhousahds)
2013 Spehd (USD hh)

Seoul 657 371.0
Taipei 634 400.0
Sihgapore 550 390.0
Tokyo 496 314.0
Mahila 4B3 249.0
!"#$%&' J&#4-%9& R2,S
Lookihg ahead, il is clear lhal lhe Iulure success oI global cilies depehds oh
beihg able lo haihlaih a cohpelilive clusler oI ahehilies, ihsliluliohs, Iihahcial
capilal ahd huhah capilal. Che vay lo gauge hov lhese hay shiIl ih lhe Iulure
is lo ask High Nel vorlh Ihdividuals aboul vhal cilies haller lo lheh loday
ahd vhal vill haller lo lheh ih 2023. A survey by Khighl Frahk (see Table 17)
shovs a sharp ihcrease ih lhe expecled ihporlahce oI Easl Asiah cehlers ih a
decades lihe. vhile such Iorecasls should be lakeh alvays vilh a pihch oI
sall (Miahi is clearly hol a global cohlehder), il should slill be holed lhal ho
cily ih Lalih Aherica, AIrica or Soulh Asia is expecled lo |oih lhe lisl. CI course,
lhis could chahge vilh lihe bul, ih order lo play ih lhe big league, large cilies
ih lhese ehergihg regiohs vill have lo creale lhe eco-syslehs lhal allov Ior
hix-ahd-halch dyhahics lo play ih bolh social ahd ecohohic spheres.
Table 1B: Survey Fesulls oh Cilies Thal vill Maller lo High Nel vorlh
Ihdividuals ih 2023
Fahk 2013 % oI respohses 2023 % oI respohses
1. Lohdoh 25% Lohdoh 22%
2. Nev York 14% Sihgapore 12%
3. Sihgapore 11% Nev York 11%
4. Hohg Kohg 9% Hohg Kohg 9%
5. Ceheva 4% Shahghai 6%
6. Shahghai 3% Bei|ihg 4%
7. Dubai 3% Miahi 3%
B. Miahi 3% Ceheva 2%
9. Paris 3% Dubai 2%
10. Bei|ihg 3% Paris 2%
!"#$%&' *,+:94 Y$2,S; [9& E&2049 \&<"$4 =>?N


3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 15



Box 2: Sihgapore: The Arl oI Buildihg a Clobal Cily
3

The ihclusioh oI cilies like Lohdoh, Tokyo or Nev York ih lhe global cilies lisls should hol be
surprisihg. They are vell-eslablished hubs backed by large haliohal ecohohies ahd lhe veighl oI
hislory. Hovever, il is ihlereslihg lhal virlually every lisl puls Sihgapore ahd Hohg Kohg ih lhe lop
leh. Ih Iacl, a survey oI vhal High Nel vorlh Ihdividuals placed Sihgapore eveh above Nev York
by 2023I Yel, il is oIleh Iorgolleh lhal lhe ihclusioh oI lhe lvo cilies ih lhe big league is very recehl
ahd lhere vere hahy cohhehlalors vho vould have vrilleh lheh oII IiIleeh years ago. Ihdeed,
hahy people had speculaled lhal Hohg Kohg vould hol survive lhe hahdover oI 1997. The
predicliohs Ior Sihgapore vere eveh hore dire aIler a series oI shocks suIIered by lhe cily-slale.
Firsl, il vas hurl by lhe Asiah Crisis oI 1997-9B. Eveh lhough Sihgapore vas hol direclly ihvolved,
ils ecohohic hihlerlahd vas devaslaled by lhe crisis. Nexl il vas hurl by lhe Tech dovhlurh oI
2000. Ahd, lheh cahe lhe scare over lhe SAFS epidehic ih 2003 (lhis also hurl Hohg Kohg).

Till 1997, Sihgapore had had a dreah ruh by cohverlihg ilselI Iroh lhird-vorld colohial oulposl lo
a Iirsl vorld cohhercial hub. Bul belveeh 1997 ahd 2002, il seehed like il had ruh oul oI luck
ahd sohe delraclors argued lhal il vould ihevilably declusler ahd slip ihlo oblivioh. The
goverhhehl, hovever, boldly decided lo double ils bel ahd cohverl Sihgapore ihlo Asias prehier
global cily
9
. This slralegy vas hol vilhoul ils crilics. As a parlicipahl ih lhe healed debales oI lhal
lihe, I rehehber hov skeplics argued lhal global cilies had alvays eherged halurally ahd vere
hol deliberalely buill up (ihcidehlally lhis is hol lrue giveh lhe evidehce oI Medici Florehce ahd
Haushahhs Paris ahohg olhers). Forluhalely, lhe Sihgaporeah aulhorilies look lhe pluhge.

Sihgapores slralegy is good exahple oI hov hix-ahd-halch ecohohics cah be applied lo cilies.
The goverhhehl ihvesled heavily ih crealihg a huhah capilal clusler by opehihg up ihhigralioh,
crealihg hev uhiversilies/lhihk-lahks ahd ihvilihg repuled Ioreigh ihsliluliohs lo sel up shop. Al lhe
sahe lihe, il ihvesled ih seclors such as leisure ahd ehlerlaihhehl Cardehs-by-lhe Bay, Forhula
Che racihg, casihos ahd so oh. Mosl ihlereslihgly, il aclively used urbah desigh lo ehcourage lhe
rahdoh ihleracliohs ahd helvorks lhal drive lvehly-Iirsl cehlury cilies. The besl vay lo
uhderslahd lhis is lo visil lhe cily cehlre. vilhih a valkable radius oI lhe Iihahcial dislricl, ohe vill
Iihd lhe hev Sihgapore Mahagehehl Uhiversily, lhe Esplahade lhealre cohplex, lhe Mariha Bay
Sahds cohplex (cohIerehce cehlre/casiho/shoppihg), a huhber oI hev huseuhs, a colohial era
crickel club, ahd hev exlehsioh lo lhe Iihahcial dislricl (vhich is also hixed ih vilh residehlial
buildihgs). Added lo lhe hix is a Iloalihg sladiuh ahd huherous holels/bars/reslaurahls. The
aulhorilies eveh vehl so Iar as lo add ih a Forhula Che race lracl ih lhe hiddle oI lhe cily eveh
lhough il causes a greal deal oI disruplioh Ior a Iev days every year (see hap belov). Nol every
ihgrediehl vorks ihdividually bul lhere cah be ho doubl lhal lhe overall clusler is very successIul.



3
For a sunnary o lho concoplual ranowork o Singaporos urban slralogy road Singaporo: Tho Arl o
Building a Clobal Cily, Sanjoov Sanyal, nslilulo o Policy Sludios (Singaporo, January 2007
9
For a sonso o lho dobalos and discussions o lhal lino soo Snall Counlry lo Big Cily, Sanjoov Sanyal,
Doulscho Bank Fosoarch, Oclobor 2003 & Singaporo: Asias Clobal Cily?, Sanjoov Sanyal, papor
prosonlod al lho Fourlh Singaporo Econonic Foundlablo, arch 2005
3 July 2013
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Page 16 Deulsche Bahk AC/Hohg Kohg



Mix-ahd-Malch as lhe Urbah Fulure
The hix-ahd-halch ecohohics oI lvehly-Iirsl cehlury cilies has sohe
ihporlahl ihplicaliohs Ior lhe vay ve lhihk oI hov urbah cehlers vill evolve
over lhe hexl Iev decades. Mahy discussiohs aboul lhe Iulure oI cilies lehd lo
driIl oII ihlo a discussioh aboul high lechhology ahd gadgels driverless cars,
3-D prihlihg, sharl grids ahd so oh. Sohe oI lhese lechhologies vill ihdeed
have ah ihpacl oh hov ve live. Hovever, here ve vill discuss lhe uhderlyihg
hela-chahge, driveh by lhe logic oI hix-ahd-halch lhal vill uhderpih hov
lhese olher chahges play oul. The Iollovihg are lhree ihporlahl vays ih vhich
lhe logic oI lvehly-Iirsl cilies vill hahiIesl lhehselves:
The Sharihg Ecohohy:
As discussed ih lhe Iirsl seclioh oI lhe reporl, lvehly-Iirsl cehlury liIeslyle is
aboul ease oI access lo hulliple ahehilies, producls ahd services. Ih lhe lasl
cehlury, access oIleh heahl ihdividual ovhership bul lhis is oIleh hol a
praclical solulioh vheh ve are svilchihg cohslahlly belveeh diIIerehl lhihgs.
Nol ohly is ovhership expehsive bul cah also be oherous. AIler all, iI I vahl lo
svih, I do hol have lo ovh a svihhihg pool bul ohly heed access lo ohe. This
sahe logic is hov beihg applied lo hore ahd hore aspecls oI liIe. The oldesl
Iorh oI urbah sharihg is lhrough lhe provisioh oI public goods (parks, public
lrahsporl, roads, draihage elc). The ihporlahce oI public goods is risihg ih lhe
hev urbah ecohohy bul hov lhe idea oI lhe "cohhohs has lo be expahded
lo ihclude various Iorhs oI privale sharihg as vell. Ih a recehl arlicle, The
Ecohohisl hagazihe dubbed il lhe "The Fise oI lhe Sharihg Ecohohy
!0
.
There are hahy hahiIeslaliohs oI lhis. The rehlal bicycles lhal have
proliIeraled ih hahy cilies are ohe exahple oI lhis phehohehoh. Car sharihg
loo is galherihg sleah aIler hahy Ialse slarls. Aholher exahple is peer-lo-peer
rehlihg vilh people rehlihg oul everylhihg Iroh roohs lo surI boards ahd
boals. Ih all lhese cases, ihIorhalioh lechhology has beeh a key ehabler by
allovihg Ior search, halchihg, lrackihg/screehihg, payhehls ahd Ieedback.
Yel aholher hahiIeslalioh oI privale sharihg is ih lhe Iorh oI closed "clubs.
This Iorh oI sharihg is useIul Ior aclivilies vhere lhe producl or service is besl
shared vilhih a closed group. Il shovs up ih social clubs, galed cohhuhilies,
cohdohihiuhs vilh hulliple ahehilies, ahd so oh. Thus, lhere has beeh a
vorldvide booh ih cohdohihiuh livihg. CohIouhdihg lhe lradiliohal idea lhal
Iahilies vilh childreh preIer slahd-alohe hohes, ve are Iihdihg lhal youhg
Iahilies hov preIer lo live ih cohdohihiuh aparlhehls vhere childreh cah
access svihhihg pools, playgrouhds, lehhis courls vilhih a secured
ehvirohhehl (lhis preIerehce is clearly visible ih hosl oI Asia bul ve Ieel lhal il
is begihhihg lo evolve ih lhis direclioh eveh ih lhe US).
valkabilily:
The regular cycles oI lvehlielh cehlury liIe alloved us lo rely heavily oh ohe
Iorh oI lrahsporl Ior hosl lhihgs (Ior hahy il vas lhe car or a sihgle Iorh oI
public lrahsporl). Che oI lhe cohsequehces oI lodays hix-ahd-halch vay oI
livihg ahd vorkihg is lhal ve heed very diIIerehl urbah lrahsporl soluliohs
lhrough lhe course oI day. Sohelihes il is besl lo use a car bul al olhers lo
use a bus, a laxi, a cycle, a lraih or |usl lo valk. Thus, eveh ih lhe US ve are
seeihg a sharp declihe ih lhe huhber oI hiles driveh per capila every year. This
is especially clear Ior youhger age cohorls lhose belveeh 16 ahd 34 years
drove 23% Iever hiles oh average ih 2009 lhah ih 2001
!!
. The heed Ior hulli-

!0
Tho Fiso o lho Sharing Econony, Tho Econonisl, 9lh arch 20!3.
!!
A ow Diroclion: Our Changing Folalionship wilh Driving & lho nplicalions or Anoricas Fuluro,
Tony Dolzik & P. Baxandall, US PFC Educalion Foundalion, Spring 20!3.
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 17



hodal public lrahsporl soluliohs has beeh ihcreasihgly recoghized by
huhicipal oIIicials ih recehl years, bul less allehlioh had beeh giveh lill
recehlly lo lhe Iacl lhal valkihg is crilical lo lhe abilily oI lhe average cilizeh lo
svilch belveeh diIIerehl hodes. This is hov chahgihg. My recehl discussiohs
vilh lhe cily hahagers oI lhe vorlds hosl advahced cilies (Nev York, Lohdoh,
Sihgapore ahd Hohg Kohg) suggesl lhal valkabilily is perhaps lhe sihgle hosl
ihporlahl dihehsioh lo hexl geheralioh urbah plahhihg. Hohe buyers eveh ih
lhe US are vakihg up lo lhis ahd lhis realizalioh accouhls Ior lhe soarihg
popularily oI services such as vvv.valkscore.coh (lhe vebsile rales
heighborhoods ahd ihdividual properlies oh lhe basis oI vhelher or hol various
ahehilies are accessible lhrough valkihg).
Il is ihporlahl lo recoghize lhal valkabilily is hol herely aboul crealihg
sidevalks. Il requires lhe crealioh oI a vhole eco-sysleh lhal ihcludes
hardvare such as sidevalks, over/uhder-bridges, sighage, slreel-lighls ahd lhe
cluslerihg oI ahehilies vilhih valkable dislahces. Hovever, il also requires
soIl-ihIraslruclure such as saIely/securily ahd slreel-liIe. Moreover, valkabilily
is hol |usl aboul valkihg bul aboul easy ihlercohhecliohs vilh olher Iorhs oI
lrahsporl such as buses, laxis, lraihs, cyclihg ahd eveh cars. Mahhallahs
High-Lihe, Hohg Kohgs helvork oI elevaled valkvays ahd Sihgapores
uhdergrouhd helvork are all exahples oI hov urbah plahhers are
ihcorporalihg valkabilily ihlo lhe urbah Iabric. The Clobal valkabilily Ihdex
belov is ah eIIorl lo provide a sihple cohparisoh oI cilies arouhd lhe vorld. Il
is hol heahl as a cohprehehsive lisl bul |usl as ah ihdicalioh oI hov diIIerehl
cilies slack up oh lhis halrix. Also hole lhal lhe ihdex lries lo accouhl Ior lhe
vider helropolilah sysleh ahd hol |usl lhe urbah core (lhus Nev Yorks
valkabilily is hol |usl aboul Mahhallah).
Crilerioh ahd ihlerprelalioh oI scores
1. Pedeslriah ihIraslruclure: pavehehls, over-bridges, slreel lighls, shade,
sighage, disabilily access ahd so oh
2. Cohheclivily: Lihkages vilh olher lrahsporl syslehs such as lrahs, lraihs,
laxis, cyclihg, buses, elc.
3. Urbah Iorh: The ecosysleh oI shops, oIIices, hohes, parks, reslaurahls,
caIes, slreel liIe ahd olher ahehilies lhal allov lhe pedeslriah lo lead his/her
liIe.
4. Dislahce: Dislahces lo be covered oh Iool ih order lo live ohes liIe. This is
lihked lo cohheclivily, dehsily ahd urbah Iorh. ve have also accouhled Ior
air qualily here.
5. SaIely: Crihe, policihg, legal sysleh, ehergehcy services ahd so oh.
Ihlerprelihg scores:
9-10= Very good, B-9=Cood, 7-B=Tolerable, 6-7=Poor, Belov 6 = Uhvalkable
Table 19: The Clobal valkabilily Ihdex
Sl Cilies Pedeslriah
IhIraslruclure
Cohheclivily Urbah
Forh
Dislahces SaIely Tolal
1. Zurich 9.0 9.5 9.5 9.5 B.5 9.2
2. Ahslerdah 9.5 9.0 9.5 9.0 B.0 9.0
3. Sihgapore 9.0 B.0 9.0 9.0 9.0 B.B
4. Muhich 9.5 9.0 9.0 B.5 B.0 B.B
5. Hohg Kohg 9.0 9.0 B.5 B.5 B.5 B.7
6. Lohdoh 9.0 B.5 B.5 B.5 B.0 B.5
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 1B Deulsche Bahk AC/Hohg Kohg



Sl Cilies Pedeslriah
IhIraslruclure
Cohheclivily Urbah
Forh
Dislahces SaIely Tolal
7. Tokyo 9.0 B.5 B.5 B.0 B.5 B.5
B. Sydhey 9.0 B.5 B.5 B.0 B.0 B.4
9. Paris 9.0 B.5 B.0 B.5 7.5 B.3
10. Islahbul B.5 B.5 B.5 B.0 B.0 B.3
11. Nev York B.5 B.5 B.5 B.0 7.5 B.2
12. Madrid B.5 B.5 B.5 B.0 7.5 B.2
13. Bosloh B.5 B.0 B.0 B.0 7.5 B.0
14. vashihgloh DC B.5 B.0 7.5 7.5 6.0 7.5
15. Bei|ihg B.0 B.0 7.0 7.0 7.5 7.5
16. Philadelphia B.0 7.5 7.5 B.0 6.0 7.4
17. Dubai 7.5 6.5 6.5 7.5 7.5 7.1
1B. Bahgkok 7.0 6.5 7.0 7.0 7.5 7.0
19. Delhi 6.5 7.0 7.5 7.0 6.0 6.B
20. Muhbai 6.0 6.5 7.0 6.5 7.5 6.7
21. Jakarla 7.0 6.0 6.0 7.0 7.5 6.7
22. Sao Paulo 7.0 7.0 6.5 6.5 6.0 6.6
23. Bahgalore 5.5 5.5 6.0 6.5 7.5 6.2
24. Phoehix 7.0 6.0 4.5 4.5 7.0 5.B
25. Johahhesburg 6.0 5.5 5.0 6.0 4.0 5.3
!"#$%&' J&#4-%9& R2,S ] [9& !#-42+,210& K02,&4 3,-4+4#4&@ 7, &2$0+&$ C&$-+", "B 49+- +,A&L I2- <$&-&,4&A 24 ^[9& E20S210& G+4._ H&%4#$&
"$:2,+X&A 1. 49& G&,4$& B"$ H+C210& G+4+&- 2,A 6$12, \&A&C&0"<8&,4 7#49"$+4.; !+,:2<"$& P7<$+0 =>?NQ
vhile ohe cah agaih quibble aboul lhe exacl rahkihgs, il vill be quile clear
Iroh lhe above lisl lhal sohe oI lhe hosl successIul cilies are also very
valkable. Civeh lhe logic oI hix-ahd-halch ecohohics, lhis should hol be
surprisihg because valkabilily is hol |usl aboul lrahsporlalioh bul aboul ah
urbah lahdscape lhal allovs Ior hulli-laskihg, rahdoh social ihleraclioh, urbah
buzz ahd so oh. Irohically, large developihg couhlry cilies like Bahgalore ahd
Johahhesburg do poorly oh lhis ihdex eveh lhough a large proporlioh oI lheir
populaliohs are loo poor lo ovh cars. This vill be a ha|or cohslraihl lo lheir
Iulure evolulioh. Neverlheless, hole lhal valkabilily is hol alvays beller ih
developed couhlries. vilh a Iev excepliohs like Nev York ahd Bosloh, US
cilies are geherally less valkable lhal vesl Europeah ahd developed Asiah
cilies. Phoehix Arizoha, Ior ihslahce, is a essehlially uhvalkable because oI ils
Iraclured urbah Iorh. ve lhihk lhal lhis vill have a ha|or hegalive ihpacl oh il
ih lhe lohg ruh. Islahbul, ih cohlrasl, is lhe hosl valkable cily ih ah ehergihg
harkel.
The Ihporlahce oI Urbah Diversily:
Che oI lhe obvious ihplicaliohs oI lhe hix-ahd-halch dyhahic is lhal social
ahd ecohohic produclivily beheIils Iroh a dehser cohcehlralioh oI people ahd
ahehilies. This arguhehl Ior dehsily ahd aggloheralioh is hov becohihg
hore videly apprecialed ahd ve have discussed il ih ah earlier reporl (see
"The Fulure oI Cur Cilies, The vide Ahgle series, 31
sl
Augusl 2011). Hovever,
lhe success oI hix-ahd-halch ecohohics is hol |usl aboul dehsily bul aboul
diversily. Moholohous suburbia hay slruggle lo cohpele ih lhis lhe 21
sl

cehlury bul so vill dehse cilies vilhoul diIIerehl kihds oI huhah capilal ahd a
real eslale slock lhal is dohihaled by cookie-culler high rises ahd/or a sihgle
ihduslry.
vell khovh urbahisls like Fichard Florida have lohg argued lhal socio-cullural
diversily is a very ihporlahl driver oI a cilys lohg lerh success
!2
. Ih ah NBEF
vorkihg Paper, Cded Calor ahd Cuahrul AshraI argue lhal socio-cullural
diversily provides a Iorh oI resiliehce lo lechhological ihhovalioh lhal cah be
selI-perpelualihg ahd cah provide ah advahlage over very lohg periods oI lihe.

!2
How Divorsily Loads lo Econonic Crowlh, Fichard Florida, Tho Allanlic Cilios, Doconbor 20!!
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 19



Thus, places lhal vere hore cullurally diverse prior lo ihduslrializalioh
cohlihue lo do beller aIler ihduslrializalioh leadihg lo suslaihed divergehce ih
oulcohes
!3
.
This arguhehl cah, hovever, beyohd socio-cullural diversily lo olher Iorhs oI
diversily real eslale slock, huhah-capilal & skills, public/social/ecohohic
ihsliluliohs, lrahsporl lihkages, greeh spaces ahd so oh. The lables belov
provide a cohparisoh oI lhe "soIl ihIraslruclure oI a Iev ha|or cilies Iroh
arouhd lhe vorld. vhile il is hol a cohprehehsive lisl, il shovs lhal successIul
global cilies are cluslers oI hahy diIIerehl kihds oI soIl ihIraslruclure. Ih
cohlrasl, Muhbai ahd Sao Paulo lag behihd oh hahy parahelers ahd lhis hay
be vhy lhey are hol yel cohsidered ha|or global cilies despile lheir size. SoIl
ihIraslruclure is oIleh cohsidered elilisl by developihg couhlry goverhhehls
bul il should be recoghized lhal lhey geherale ecohohic value ahd real |obs
ahd are key lo lhe soIl pover oI global cilies.
The ihporlahce oI urbah diversily has ihporlahl ihplicaliohs Ior lhe Iulure
lra|eclory oI hahy cilies, especially ih lhose ehergihg couhlries. The hediuh
sized cookie-culler ihduslrial cilies oI Chiha, Ior ihslahce, hay iI diIIicull Iihd il
ih lhe lohg ruh as lhey slruggle lo reihvehl lhehselves eveh as lhe hore
successIul aggloheraliohs like Bei|ihg ahd Shahghai suck oul lhe besl lalehl.
Eveh successIul global cilies vill have lo lhihk aboul lhe Iulure oI
heighborhoods vilh ihadequale urbah diversily. Eveh posler-child Sihgapore,
Ior ihslahce, has hahy large Housihg Develophehl Board eslales dohihaled
by a Iorh oI slahdardizalioh lhal could Iihd il diIIicull lo cope vilh lhe hix-
ahd-halch dyhahics oI lhe 21
sl
cehlury.
Table 20: Cullural Diversily Slalislics ih Selecled Large Cilies
Ihdicalor Berlih Islahbul Johahhes
burg
Lohdoh Muhbai Nev York Paris So Paulo Shahghai Sihgapore Sydhey Tokyo
No. oI haliohal
huseuhs
1B.0 7.0 9.0 11.0 4.0 5.0 24.0 1.0 27.0 5.0 1.0 B.0
No. oI olher huseuhs 140.0 71.0 51.0 162.0 6.0 126.0 113.0 110.0 B7.0 4B.0 59.0 39.0
No. oI arl galleries 421.0 267.0 76.0 B57.0 152.0 721.0 1,046.0 NA 20B.0 252.0 122.0 6BB.0
Visils lo Iive hosl
popular
huseuhs/galleries
(hillioh)
4.7 7.1 0.6 25.3 1.B 15.4 23.4 2.2 6.6 2.7 2.B 9.7
No. oI vorld Herilage
Siles
3.0 1.0 1.0 4.0 2.0 1.0 4.0 0.0 0.0 0.0 2.0 1.0
% public greeh space
(parks ahd gardehs)
14.4% 1.5% 24.0% 3B.4% 2.5% 14.0% 9.4% NA 2.6% 47.0% 46.0% 3.4%
No. oI ciheha screehs 266.0 501.0 36B.0 566.0 232.0 501.0 1,003.0 2B2.0 670.0 239.0 295.0 334.0
No. oI ciheha
adhissiohs (hilliohs)
9.1 10.3 13.1 41.6 10.9 NA 5B.2 50.0 22.9 22.1 2.3 29.3
No. oI lhealre
perIorhahces
6,900 6,349 5,000 32,44B B,750 43,004 26,676 NA 15,61B 2,421 4,966 24,575
No. oI lhealre
adhissiohs (hillioh)
2.4 2.4 1.7 14.2 2.7 2B.1 5.7 NA 0.6 0.6 0.7 12.0
No. oI ha|or cohcerl
halls
2 6 13 10 2 15 15 7 4 B 4 15
No. oI bars 1,247 657 NA 2,143 543 7,224 3,350 NA 1,320 576 661 14,1B4
No. oI reslaurahls 4,BB5 1,50B 15,000 37,450 13,205 24,149 22,327 12,500 55,614 2,637 4,554 150,510
No. oI ihlerhaliohal
sludehls
21,B05 6,643 37,067 99,360 1,500 60,791 96,7B2 15,432 43,016 91,500 NA 43,1BB
No. oI ihlerhaliohal
lourisls (hillioh)
2.9 B.1 4.0 15.2 2.2 B.4 13.3 1.6 B.5 11.6 2.6 5.9
% Ioreigh-borh
populalioh
13.2% NA 5.7% 30.B% 1.4% 36.B% 12.4% NA 0.9% 26.9% 34.4% 2.4%
!"#$%&' E"$0A G+4+&- G#04#$& \&<"$4 W )2."$ "B H",A",

!3
Cullural Divorsily, Coographical solalion and lho Origins o lho voallh o alion, Ouanrul Ashra and
Odod Calor, BEF vorking Papor, Doc 20!!.
3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 20 Deulsche Bahk AC/Hohg Kohg



The vide Ahgle Series







3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 21



The Fahdoh valk Series











3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Page 22 Deulsche Bahk AC/Hohg Kohg



Appehdix 1

Ihporlahl Disclosures

Addiliohal ihIorhalioh available upoh requesl

For disclosures perlaihihg lo recohhehdaliohs or eslihales hade oh securilies olher lhah lhe prihary sub|ecl oI lhis
research, please see lhe hosl recehlly published cohpahy reporl or visil our global disclosure look-up page oh our
vebsile al hllp://gh.db.coh/ger/disclosure/DisclosureDireclory.eqsr

Ahalysl CerliIicalioh
The vievs expressed ih lhis reporl accuralely reIlecl lhe persohal vievs oI lhe uhdersighed lead ahalysl(s). Ih addilioh,
lhe uhdersighed lead ahalysl(s) has hol ahd vill hol receive ahy cohpehsalioh Ior providihg a speciIic recohhehdalioh
or viev ih lhis reporl. Sah|eev Sahyal

3 July 2013
The vide Ahgle: vhal Drives 21sl Cehlury Cilies?

Deulsche Bahk AC/Hohg Kohg Page 23




Fegulalory Disclosures
1. Ihporlahl Addiliohal CohIlicl Disclosures
Aside Iroh vilhih lhis reporl, ihporlahl cohIlicl disclosures cah also be Iouhd al hllps://gh.db.coh/equilies uhder lhe
"Disclosures Lookup ahd "Legal labs. Ihveslors are slrohgly ehcouraged lo reviev lhis ihIorhalioh beIore ihveslihg.
2. Shorl-Terh Trade Ideas
Deulsche Bahk equily research ahalysls sohelihes have shorler-lerh lrade ideas (khovh as SCLAF ideas) lhal are
cohsislehl or ihcohsislehl vilh Deulsche Bahks exislihg lohger lerh ralihgs. These lrade ideas cah be Iouhd al lhe
SCLAF lihk al hllp://gh.db.coh.
3. Couhlry-SpeciIic Disclosures
Auslralia ahd Nev Zealahd: This research, ahd ahy access lo il, is ihlehded ohly Ior "vholesale cliehls vilhih lhe
heahihg oI lhe Auslraliah Corporaliohs Acl ahd Nev Zealahd Fihahcial Advisors Acl respeclively.
Brazil: The vievs expressed above accuralely reIlecl persohal vievs oI lhe aulhors aboul lhe sub|ecl cohpahy(ies) ahd
ils(lheir) securilies, ihcludihg ih relalioh lo Deulsche Bahk. The cohpehsalioh oI lhe equily research ahalysl(s) is
ihdireclly aIIecled by revehues derivihg Iroh lhe busihess ahd Iihahcial lrahsacliohs oI Deulsche Bahk. Ih cases vhere
al leasl ohe Brazil based ahalysl (idehliIied by a phohe huhber slarlihg vilh +55 couhlry code) has lakeh parl ih lhe
preparalioh oI lhis research reporl, lhe Brazil based ahalysl vhose hahe appears Iirsl assuhes prihary respohsibilily Ior
ils cohlehl Iroh a Braziliah regulalory perspeclive ahd Ior ils cohpliahce vilh CVM Ihslruclioh # 4B3.
EU couhlries: Disclosures relalihg lo our obligaliohs uhder MiFiD cah be Iouhd al
hllp://vvv.globalharkels.db.coh/riskdisclosures.
Japah: Disclosures uhder lhe Fihahcial Ihslruhehls ahd Exchahge Lav: Cohpahy hahe - Deulsche Securilies Ihc.
Fegislralioh huhber - Fegislered as a Iihahcial ihslruhehls dealer by lhe Head oI lhe Kahlo Local Fihahce Bureau
(Kihsho) No. 117. Mehber oI associaliohs: JSDA, Type II Fihahcial Ihslruhehls Firhs Associalioh, The Fihahcial Fulures
Associalioh oI Japah, Japah Ihveslhehl Advisers Associalioh. This reporl is hol heahl lo solicil lhe purchase oI speciIic
Iihahcial ihslruhehls or relaled services. ve hay charge cohhissiohs ahd Iees Ior cerlaih calegories oI ihveslhehl
advice, producls ahd services. Fecohhehded ihveslhehl slralegies, producls ahd services carry lhe risk oI losses lo
prihcipal ahd olher losses as a resull oI chahges ih harkel ahd/or ecohohic lrehds, ahd/or Iluclualiohs ih harkel value.
BeIore decidihg oh lhe purchase oI Iihahcial producls ahd/or services, cuslohers should careIully read lhe relevahl
disclosures, prospecluses ahd olher docuhehlalioh. "Moodys, "Slahdard & Poors, ahd "Filch hehliohed ih lhis
reporl are hol regislered credil ralihg agehcies ih Japah uhless "Japah or "Nippoh is speciIically desighaled ih lhe
hahe oI lhe ehlily.
Malaysia: Deulsche Bahk AC ahd/or ils aIIiliale(s) hay haihlaih posiliohs ih lhe securilies reIerred lo hereih ahd hay
Iroh lihe lo lihe oIIer lhose securilies Ior purchase or hay have ah ihleresl lo purchase such securilies. Deulsche Bahk
hay ehgage ih lrahsacliohs ih a hahher ihcohsislehl vilh lhe vievs discussed hereih.
Fussia: This ihIorhalioh, ihlerprelalioh ahd opihiohs subhilled hereih are hol ih lhe cohlexl oI, ahd do hol cohslilule,
ahy appraisal or evalualioh aclivily requirihg a licehse ih lhe Fussiah Federalioh.
Fisks lo Fixed Ihcohe Posiliohs
Macroecohohic Iluclualiohs oIleh accouhl Ior hosl oI lhe risks associaled vilh exposures lo ihslruhehls lhal prohise
lo pay Iixed or variable ihleresl rales. For ah ihveslor lhal is lohg Iixed rale ihslruhehls (lhus receivihg lhese cash
Ilovs), ihcreases ih ihleresl rales halurally liIl lhe discouhl Iaclors applied lo lhe expecled cash Ilovs ahd lhus cause a
loss. The lohger lhe halurily oI a cerlaih cash Ilov ahd lhe higher lhe hove ih lhe discouhl Iaclor, lhe higher vill be lhe
loss. Upside surprises ih ihIlalioh, Iiscal Iuhdihg heeds, ahd FX deprecialioh rales are ahohg lhe hosl cohhoh adverse
hacroecohohic shocks lo receivers. Bul couhlerparly exposure, issuer credilvorlhihess, cliehl seghehlalioh, regulalioh
(ihcludihg chahges ih assels holdihg lihils Ior diIIerehl lypes oI ihveslors), chahges ih lax policies, currehcy
cohverlibilily (vhich hay cohslraih currehcy cohversioh, repalrialioh oI proIils ahd/or lhe liquidalioh oI posiliohs), ahd
selllehehl issues relaled lo local clearihg houses are also ihporlahl risk Iaclors lo be cohsidered. The sehsilivily oI Iixed
ihcohe ihslruhehls lo hacroecohohic shocks hay be hiligaled by ihdexihg lhe cohlracled cash Ilovs lo ihIlalioh, lo
FX deprecialioh, or lo speciIied ihleresl rales - lhese are cohhoh ih ehergihg harkels. Il is ihporlahl lo hole lhal lhe
ihdex Iixihgs hay by cohslruclioh lag or his-heasure lhe aclual hove ih lhe uhderlyihg variables lhey are ihlehded
lo lrack. The choice oI lhe proper Iixihg (or helric) is parlicularly ihporlahl ih svaps harkels, vhere Iloalihg coupoh
rales (i.e., coupohs ihdexed lo a lypically shorl-daled ihleresl rale reIerehce ihdex) are exchahged Ior Iixed coupohs. Il is
also ihporlahl lo ackhovledge lhal Iuhdihg ih a currehcy lhal diIIers Iroh lhe currehcy ih vhich lhe coupohs lo be
received are dehohihaled carries FX risk. Nalurally, opliohs oh svaps (svapliohs) also bear lhe risks lypical lo opliohs
ih addilioh lo lhe risks relaled lo rales hovehehls.



CFC20!3PFOD029637



David Folkerls-Lahdau
Clobal Head oI Fesearch

Marcel Cassard
Clobal Head
CB&S Fesearch
FalI HoIIhahh & Berhhard Speyer
Co-Heads
DB Fesearch
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ChieI Cperalihg CIIicer
Fesearch
Fichard Shilh
Associale Direclor
Equily Fesearch

Asia-PaciIic
Fergus Lyhch
Fegiohal Head
Cerhahy
Ahdreas Neubauer
Fegiohal Head
Norlh Aherica
Sleve Pollard
Fegiohal Head


Ihlerhaliohal Localiohs
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The ihIorhalioh ahd opihiohs ih lhis reporl vere prepared by Deulsche Bahk AC or ohe oI ils aIIiliales (colleclively "Deulsche Bahk). The ihIorhalioh hereih is believed lo be reliable ahd has beeh oblaihed Iroh public
sources believed lo be reliable. Deulsche Bahk hakes ho represehlalioh as lo lhe accuracy or cohplelehess oI such ihIorhalioh.
Deulsche Bahk hay ehgage ih securilies lrahsacliohs, oh a proprielary basis or olhervise, ih a hahher ihcohsislehl vilh lhe viev lakeh ih lhis research reporl. Ih addilioh, olhers vilhih Deulsche Bahk, ihcludihg
slralegisls ahd sales slaII, hay lake a viev lhal is ihcohsislehl vilh lhal lakeh ih lhis research reporl.
Cpihiohs, eslihales ahd pro|ecliohs ih lhis reporl cohslilule lhe currehl |udgehehl oI lhe aulhor as oI lhe dale oI lhis reporl. They do hol hecessarily reIlecl lhe opihiohs oI Deulsche Bahk ahd are sub|ecl lo chahge
vilhoul holice. Deulsche Bahk has ho obligalioh lo updale, hodiIy or ahehd lhis reporl or lo olhervise holiIy a recipiehl lhereoI ih lhe evehl lhal ahy opihioh, Iorecasl or eslihale sel Iorlh hereih, chahges or
subsequehlly becohes ihaccurale. Prices ahd availabilily oI Iihahcial ihslruhehls are sub|ecl lo chahge vilhoul holice. This reporl is provided Ior ihIorhaliohal purposes ohly. Il is hol ah oIIer or a solicilalioh oI ah
oIIer lo buy or sell ahy Iihahcial ihslruhehls or lo parlicipale ih ahy parlicular lradihg slralegy. Targel prices are ihherehlly ihprecise ahd a producl oI lhe ahalysl |udgehehl. As a resull oI Deulsche Bahks March 2010
acquisilioh oI BHF-Bahk AC, a securily hay be covered by hore lhah ohe ahalysl vilhih lhe Deulsche Bahk group. Each oI lhese ahalysls hay use diIIerihg helhodologies lo value lhe securily, as a resull, lhe
recohhehdaliohs hay diIIer ahd lhe price largels ahd eslihales oI each hay vary videly. The Iihahcial ihslruhehls discussed ih lhis reporl hay hol be suilable Ior all ihveslors ahd ihveslors husl hake lheir ovh
ihIorhed ihveslhehl decisiohs. Slock lrahsacliohs cah lead lo losses as a resull oI price Iluclualiohs ahd olher Iaclors. II a Iihahcial ihslruhehl is dehohihaled ih a currehcy olher lhah ah ihveslors currehcy, a chahge
ih exchahge rales hay adversely aIIecl lhe ihveslhehl. Pasl perIorhahce is hol hecessarily ihdicalive oI Iulure resulls. Deulsche Bahk hay vilh respecl lo securilies covered by lhis reporl, sell lo or buy Iroh
cuslohers oh a prihcipal basis, ahd cohsider lhis reporl ih decidihg lo lrade oh a proprielary basis.
Derivalive lrahsacliohs ihvolve huherous risks ihcludihg, ahohg olhers, harkel, couhlerparly deIaull ahd illiquidily risk. The approprialehess or olhervise oI lhese producls Ior use by ihveslors is depehdehl oh lhe
ihveslors ovh circuhslahces ihcludihg lheir lax posilioh, lheir regulalory ehvirohhehl ahd lhe halure oI lheir olher assels ahd liabililies ahd as such ihveslors should lake experl legal ahd Iihahcial advice beIore
ehlerihg ihlo ahy lrahsaclioh sihilar lo or ihspired by lhe cohlehls oI lhis publicalioh. Tradihg ih opliohs ihvolves risk ahd is hol suilable Ior all ihveslors. Prior lo buyihg or sellihg ah oplioh ihveslors husl reviev lhe
"Characlerislics ahd Fisks oI Slahdardized Cpliohs, al hllp://vvv.lheocc.coh/cohpohehls/docs/risksloc.pdI . II you are uhable lo access lhe vebsile please cohlacl Deulsche Bahk AC al +1 (212) 250-7994, Ior a
copy oI lhis ihporlahl docuhehl.
The risk oI loss ih Iulures lradihg, Ioreigh or doheslic, cah be subslahlial. As a resull oI lhe high degree oI leverage oblaihable ih Iulures lradihg, losses hay be ihcurred lhal are grealer lhah lhe ahouhl oI Iuhds
ihilially deposiled.
Uhless goverhihg lav provides olhervise, all lrahsacliohs should be execuled lhrough lhe Deulsche Bahk ehlily ih lhe ihveslors hohe |urisdiclioh. Ih lhe U.S. lhis reporl is approved ahd/or dislribuled by Deulsche
Bahk Securilies Ihc., a hehber oI lhe NYSE, lhe NASD, NFA ahd SIPC. Ih Cerhahy lhis reporl is approved ahd/or cohhuhicaled by Deulsche Bahk AC FrahkIurl aulhorized by lhe BaFih. Ih lhe Uhiled Kihgdoh lhis
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ahd aulhorized by lhe BaFih. This reporl is dislribuled ih Hohg Kohg by Deulsche Bahk AC, Hohg Kohg Brahch, ih Korea by Deulsche Securilies Korea Co. This reporl is dislribuled ih Sihgapore by Deulsche Bahk AC,
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ihveslor (as deIihed ih lhe applicable Sihgapore lavs ahd regulaliohs), Deulsche Bahk AC, Sihgapore Brahch or Deulsche Securilies Asia Lihiled, Sihgapore Brahch accepls legal respohsibilily lo such persoh Ior lhe
cohlehls oI lhis reporl. Ih Japah lhis reporl is approved ahd/or dislribuled by Deulsche Securilies Ihc. The ihIorhalioh cohlaihed ih lhis reporl does hol cohslilule lhe provisioh oI ihveslhehl advice. Ih Auslralia, relail
cliehls should oblaih a copy oI a Producl Disclosure Slalehehl (PDS) relalihg lo ahy Iihahcial producl reIerred lo ih lhis reporl ahd cohsider lhe PDS beIore hakihg ahy decisioh aboul vhelher lo acquire lhe producl.
Deulsche Bahk AC Johahhesburg is ihcorporaled ih lhe Federal Fepublic oI Cerhahy (Brahch Fegisler Nuhber ih Soulh AIrica: 199B/00329B/10). Addiliohal ihIorhalioh relalive lo securilies, olher Iihahcial producls or
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vheh quolihg.
Copyrighl 2013 Deulsche Bahk AC