Beijing
Berlin
Buenos Aires
Chicago
Dubai
Hong Kong
Istanbul
Jakarta
Johannesburg
Kuala Lumpur
London
Los Angeles
Madrid
Mexico City
Milan
Moscow
MumbaiNairobi
New York
Paris
Rio de Janeiro
San Francisco
São PauloSeoul
Shanghai
Singapore
Stockholm
SydneyTokyo
Toronto
Cities of Opportunity 6
Cities of Opportunity 6 analyzes the trajectory
and culture—and, through their current
Cities of Opportunity 6: We, the urbanpeople
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Taking the pulse of 30 citiesat the heart of the world’s economy and culture
The sixth edition of Cities of Opportunitycontinues an investigation that began in 2007in an effort to help the world’s great citiesunderstand what policies and approacheswork best for people and economies in arapidly urbanizing world.
Again this year, we look at a group of30 cities that embody the energy, opportu-nity and hope that draw new people everyday to city life and make urbanization one ofthe most powerful megatrends of our time.Jakarta, Nairobi and Rio de Janeiro also jointhe list in this edition, and Dubai rejoins,
and commercial center.
Our methodology also carries forward fromthe last edition:carefully selects a wide range of targeted,
the cities’ balanced social and economic vitalsigns. Results do not so much judge as open awindow on directions to improve city life forbusinesses, governments and communities.
In terms of results, London posts thehighest score by a good margin after lockingin a virtual tie with New York in Cities ofOpportunity 5
and city gateway—all measures of its statureas a thriving center of the world economy.New York follows, again winning no indicatorcategories, but showing a strong balanceacross the board.
Singapore advances markedly in this edition.The city-state climbs four spots to third
it is well-known for—transportation andinfrastructure and ease of doing business.
four, and San Francisco climbs over Paris and
Beyond that, city life was never meant toremain unchanged, and neither was Cities ofOpportunity. As in most years, we’ve revisedand improved a number of data variables.For instance, cost of public transport nowmeasures the price of a trip from the city’sfarthest boundary to the central businessdistrict rather than from farthest boundary tofarthest boundary in an effort to capture themost typical urban journey.
Even more notably, we asked PwCprofessionals in our 30 cities to tell us abouttheir own urban experience, and 15,000 of
of their commute and telling us their relo-cation preferences among our 30 cities. (A
in-depth look at the demographics of ourcities—people—will be released as a companion pieceto this report.)
Our 10 indicator categories remain the sameas in the last edition, but we’ve organized
balance of urban life. Tools for a changingworld takes the measure of intellectualcapital, technology readiness, and a city’sopenness as a global hub. Quality of lifeexamines tangible and intangible characteris-tics that set the city’s emotional and physicalmeter, from transportation to hospitals tocultural vibrancy. Economics tells us howwell the cities are doing as centers of business
As in other editions, we also try to capturethe spirit of the city in ways numbers cannotmeasure by including interviews, as wellas focused reporting. These tell us clearlythat creativity is in the urban air, though itmanifests itself in many forms, from tech-nological and artistic innovation to heritageconservation, to the embrace of diversity andchange, and even to the rise of intelligentmachines that threaten traditional employ-ment structures.
our study is not conducted jointly with thePartnership for New York City. PwC carrieson with genuine thanks to the Partnershipas a trusted and dedicated collaborator andongoing advisor.
All told, we continuein the same spirit the study began after9/11—that of lively curiosity and rigorousendeavor in order to shed light on the mosteffective ways to drive urban life for thegreatest common good.
Bob MoritzUS Chairman and Senior PartnerPricewaterhouseCoopers LLP
Sincerely,
2 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Seeking the right balance for healthy urban growth
Cities have long managed themselves on a seesaw between individual will—the freewheeling ways ofpeople to start businesses, reroute streets, celebrate, protest, and, generally, do what they want whenthey want—and the need for societies to organize rationally and effectively. How does a city balance the“blessed rage to order,” as poet Wallace Stevens described the human need to structure reality, with the“messy heterogeneity” that Suketu Mehta, author of , tells us is akey to a thriving, modern city?
It’s a hard road to walk—and shedding light on the path is one of the reasons we undertake Cities ofOpportunity. One way or the other, the thrill of the city is in our blood as is our shared responsibility tomake it better.
Overview
8
How the cities rank
Singapore nudges right next toNew York.
12
The study’s methodology
Our approach evolves, this yearadding a PwC survey.
Education, technology, and global access
16
“Nothing remains still”
That age-old observation stillholds, especially for moderncities. What does it take for citiesto stay ahead of the curve at atime of massive urban growth?
18
Intellectual capital andinnovation
Paris overtakes Stockholm forthe top spot, as London and SanFrancisco also advance.
20
Viking invaders beat swordsinto software
A horde of Stockholm startupsstormed Manhattan with UllaHamilton, deputy mayor forentrepreneurism, to showcasetheir innovation.
23
Technology readiness
The digital divide continues toseparate many cities.
24
Big data…big city…big dreams
Scientists and economists at theCenter for Urban Science andProgress in New York peer througha powerful new looking glass inthe age of urban informatics.
30
City gateway
More than ever, most roads (and
-
20 24
¤ 3
Attaining the good life is anything but a walk in the park
34
Transportation andinfrastructure
Singapore blazes the trail inurban mobility.
36
Shanghai balances growth withits living heritage
Wang Lin and Ron van Oersexplain how one of Asia’s greatcities blends urban conservationinto its planning for growth.
40
Health, safety, and security
are critical.
42
Sustainability and the naturalenvironment
more precise picture of our cities’sustainability.
44
The Prado’s relationship withMadrid holds a full palette of
Miguel Zugaza oversees one ofthe world’s great art collections.His passion for the art itselfand the quality of the viewer’sexperience keeps the museumprospering despite massivefunding cutbacks. And the Pradois aiding Madrid in the process.
48
Demographics and livability
Two new variables rejigger theorder within the top 10.
50
From Mumbai to Manhattan tothe favelas of Brazil
Suketu Mehta, author of
, has lived in and writtenabout many of the world’sgreat cities. Here he shares histhoughts.
- Citi -
-
36 44 50
4 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Paying the way for progress
56
Economic clout
London ascends to the summit,-
ably consistent.
58
Robots are coming to a citynear you…and they wantyour job!
Erik Brynjolfsson of MIT explainshow to stay a step ahead of tech-nological unemployment.
62
Ease of doing business
After a while, competitivenessis bred in the bone of the mostsuccessful cities.
64
Cost
Mature cities’ (higher) wagescan successfully compete againstemerging cities’ (lower) prices.
-
58
¤ 5
66
Key to the variables
Understanding the data pointsthat underpin the study.
On the web
See www.pwc.com/cities forinteractive modelers, videos,full-length versions of theinterviews, and detailed data
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Overview
Ѫ»®ª·»© ¤ 7
п®·
Cities of Opportunity 6
This year, we’ve organized our 10 indicators-
tals of a well-balanced city: forward-lookingtools such as education and technology;quality of life making cities healthy, happy,and sustainable; and the ability to pay thebills for it all. However, reorganization doesnot cut down on the observations to begleaned from the 59 overall data points onour 30 cities. Here are some of the most inter-
Cities of Opportunity 6.
Although London takes the top spot in our
our last report that it was coming up quickly
than a tenth of 1 percent) behind New Yorkin our last edition in a virtual tie. This year,London clearly takes the lead and is also the
New York, on the other hand, while missingout on the top rank in all indicators, showscontinuing superior consistency across mostof the indicator categories. The other strongcontender is Singapore. It scores an unexpect-edly robust third place just behind New York
cities in the top 10 in our last report remainin the top 10 in this one, albeit with somenatural movement up or down.
The only city that was not in the top 10 inour last report but climbs into that selectgroup in this one is Sydney, which also
quality of life, sustainability and the naturalenvironment, as well as demographics and
one of them) and seventh overall, just behindParis. Two other cities renowned for theirexceptional quality of life, Toronto and San
report, echoing previous results, is what wecalled in Cities of Opportunity 5 “a virtuouscircle of social and economic strengths.”When “great quality-of-life factors…arebalanced with strong businesses and solidinfrastructure,” the resulting formula—or,better yet, network of reinforcing advantagesand assets—creates and sustains resilientcities with high standards of living.
in the top 10 in at least half of our indicators
cities score in the top 10 in the majority ofindicators, which proves just how comprehen-sively they attend to most of the factors that
they actively sweat the details on virtuallyevery aspect of urban policy and organization.
doesn’t matter what size a city is as long asit’s a city. Every one of our indicators has bothsmall and large cities in the top 10, usuallyin a good mix. Even our economic clout andcity gateway indicators, which are intuitively
-nent”) cities, have several smaller cities in the
of-life indicators have a majority of smallercities in the top 10.
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This last fact is critical because it also illus-trates the relationship between cities andtheir people. After a certain level of economicsuccess, a city’s residents demand more frommunicipal administrations. In fact, economicsuccess normally is seen as (and historicallyhas been) the basis for those improvements inurban life that lead to a city’s infrastructuraldevelopment, from schools, hospitals, andpolice to roads, buses, and metros to libraries,parks, and environmental sustainability. Whileit might be the simple demographic fact ofpopulation density and expansion that turnstowns into cities, it is the self-consciousness ofcitizens—and their proud participation in thegrowth of their respective cities—that urgescities to improve the quality of life of the menand women who live in them.
Parlez-vous intellectual capital?
What is perhaps most impressive about Paris’s#1 ranking in intellectual capital and inno-vation
is most striking is the group that Paris risesabove. Look at the top 10 again: Seven of thecities are English-speaking, and an eighth,Stockholm, is a city in which English is almost
city in which the natural language of intellec-tual investigation and research is not Englishis #10 Tokyo (see page 18).
This is a resonant achievement that plainlyrefutes the notion that non-English-speakerscan’t compete, intellectually or techno-logically, within the context of today’sglobalization of English. It also encouragescities such as Berlin and Seoul—whichjust fall out of the top 10—not to mentionShanghai and Beijing or São Paulo and Riode Janeiro. Clearly, these results demon-strate the value of education and innovationin —as opposed to the languagein which they are conducted—preciselybecause, as this section says, they are themost important tools of a changing world.
Think locally, connect globally…
Technology’s obvious capacity to level
developing cities (as well as East and West)
indicator, in which Seoul ties London for
indicator, we see a geographical andcultural dispersion among the top 10 here
-tive ability to upend traditional patterns ofeconomic sway and competitiveness.
…but connect, in any case
The city gateway indicatortruth that, year after year, the most successfulcities are those tenacious, persistent ones
that persevere through good times and badregardless of whatever is thrown at themeconomically, socially, politically, or environ-mentally. And a critical reason they surviveso well is because they’ve always been open
indicator, is, of course, an icon of globaltrade and commerce. But if we look at theother nine cities in the top 10, we immedi-ately notice that six are ports—and almostall of them famous ones (see page 30). One
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(Paris) is located on a celebrated commercialwaterway, and only two, Beijing and Madrid,are inland, although both have rivers runningthrough them (and, in Beijing’s case, several).
The city gateway indicator means a numberof things, but, before and beyond every-thing else, it means exactly what it says:city gateway. For a city to be looked upon bythe world as a model, a symbol, or even ahaven, it has itself to be continually lookingto the world and to be open to it for thatfundamental exchange of ideas, people, andcommerce that, in the past as well as in the
Singapore moves people—and houses
them as wellSingapore dominates among the cities ofopportunity in transportation and infra-structure
much larger margin in this one. Moreover,the difference in score between Singaporeand #2 Toronto is great (even more than thatbetween the Canadian city and #15 MexicoCity). Singapore clearly understands thefundamental role of infrastructure in a city’sdevelopment and in its contribution to thewell-being of its citizens. It is particularly
variable that measures the availability, cost,and quality of housing (which shows a strong,positive correlation with the overall socialand economic health of a city).
The other noteworthy result in this indicatoris the exceptionally wide range of cities thatmake up the top 10. Buenos Aires and Seoultie for third place, followed by Paris, London,and Madrid (tied, again, for sixth place),Stockholm, Berlin, and Dubai. This is, to saythe least, an unusual mix of cities, whichillustrates that good infrastructure is notnecessarily a product just of economic cloutor global prominence (as measured by ourcity gateway indicator).
Whether or not small is beautiful, it’s
decidedly healthy and safe
Although we changed the variables slightlyin this edition, the results in health, safety,and security have hardly changed from our
a marginal difference, as it did previously.Sydney and Toronto tie for second, currentlywith a tiny difference between them, while
in our previous report. In the end, nine of thecities in the top 10 in the last report remain inthe top 10 in this one.
What is perhaps more interesting than theactual ranking of the cities is their size. The
population of just under 2.5 million. Andeven if we add the populations of the top10—which includes London, Singapore, andNew York—we’re still left with an average justabout 1.4 million larger. The result is no lesscompelling for being so obvious: Larger cities,with larger populations, must strive harder,and expend more resources, to secure thehealth and safety of their residents.
Where health and safety lead,
sustainability follows
Seven of the cities in the top 10 in the
cities in the top 10 in sustainability and thenatural environment. And, again, ifwe average out the populations of these10 cities, it comes to roughly 3.61 millionpeople—and that’s only because of onecity, Moscow, whose population is almost12 million. If we delete Moscow from the
drops almost by a million to 2.69 million.Clearly, urban sustainability means just that:
urban magnitudes.
London beckons to would-be expats
Demographics and livability rounds out thequality-of-life section of our study. It is also
staff survey of 15,000 professionals thatsupplements this year’s Cities of Opportunity.Two variables are based on survey results, oneof which measures responses to the question,“Of the cities in Cities of Opportunity (otherthan your own), which are the top three inwhich you’d most like to work?” London
a whisker ahead of London in the overalldemographics and livability ranking andplaces third as most desired city for relocation.
As for the other most desired cities for reloca-tion, New York comes in a close second toLondon (41 percent to 47 percent, respec-tively)—showing professionals are powerfullyattracted to the energy and opportunity ofthe world’s most competitive cities. Sydney,
however, comes in third most desirable atjust under 28 percent with San Franciscofollowing close behind at 26 percent—suggesting that good quality of life has apowerful pull, perhaps made even moreseductive by beautiful beaches and sophisti-cated culture.
When it comes to economic success, be
strong but also be competitive
three economic indicators. Together, theypoint to the synergies needed if economicgrowth is to lead to permanent economic
cities in our ,are London, Beijing, New York, Paris, andShanghai. They are all legendary citiesthat mirror the economic history of theurban world during the last couple ofhundred years.
our secondindicator, cost,clout, however. But the three cities in the top10 in cost economic clout are also in thetop 10 in our third indicator, ease of doingbusiness. In addition to their success in allthree indicators, these three mature cities—New York, San Francisco, and Toronto—alsorebut the notion that developed cities can’tcompete on costs. Finally, given that six of thecities in the top 10 in economic clout are alsoin the top 10 in ease of doing business, our
a city in which it is easy to do business willactually do so successfully.
The texture of city life emerges beyond
the numbers
While quantitative results tell one sort ofstory, the human experience of leadersand thinkers at any moment in time adds adifferent layer of insight. This year, those wespoke with mention technology often butquickly bridge to innovation, creativity, andthe need to be one with the spirit of a greatcity. It seems, to borrow from Dylan Thomas,“the force that through the green fuse drives
Roll over Leif Eriksson and tell Valhalla
the news!
Accompanied to New York by a horde ofNordic software developers, if not blood-thirsty Vikings, Stockholm’s vice mayor
Ѫ»®ª·»© ¤ 11
for entrepreneurism, Ulla Hamilton, toldus her small, sustainable city with a powerfulbroadband network has been “lucky in thearea [of entrepreneurism] for several reasons.We have a very interesting mix of lifescience companies, information and commu-nications technology companies, cleantech companies, and the entertainment indus-tries.…That creates an innovative climate.Also, Swedes are very interested in solvingproblems, and it has become fashionable tostart your own company.” One of Stockholm’smost successful startups, DICE, even brought
Viking spirit is not dimmed by a pair of jeansor a business suit.
Change those bad behaviors or else!
At New York University’s Center for UrbanScience and Progress (CUSP), the hope ofurban informatics is being explored every-
energy management. But according toCUSP’s director Steven Koonin, big dataisn’t so much a driving force to managecities but a tool to help people see andimprove urban patterns. Koonin explains“science with a social dimension” holds thepromise of urban informatics to make city
than a way to understand our own collectivebehavior and, with the help of behavioraleconomics, build better, more logicalapproaches to city dynamics.
In other words, individually, it may be hardto start healthy eating looking straight ata bowl of vanilla ice cream, but we may beable to push collective behaviors in the rightdirection guided by the power of informationand the need to serve the common good inmassive, densely populated cities where weall share in success.
Shanghai surprise: A huge city
manages breathtaking growth with an
eye on its heritage
“A city is a place for people to live, so youneed to adapt and make use of heritage,”explains Wang Lin, director of historicconservation in Shanghai. Her city’s explo-sion to 14.1 million permanent residents(nearly 24 million in the wider metropolitanarea) may not have begun with as big an eyeon Shanghai’s history, but, today, Lin says
sustainable. We need to pay more attentionto the quality of the city. We need to keep abalance between the environment and theeconomy. And equality is very important.”Careful management of the great city’s past—its 12 historic conservation areas—weavesright into the fabric of Shanghai’s future.Lin’s focus on Shanghai is complemented byRon van Oers of the World Heritage Instituteof Training and Research for Asia and the
Heritage Cities Programme, who offers aglobal perspective.
The Prado unveils an Enlightenment
approach to crisis management
Despite 60 percent government fundingcuts to Madrid’s splendid museum, Pradodirector Miguel Zugaza tells us “our reactionwas to actually invigorate our activities, domore that would appeal to more visitors.”And his approach is working. Extended hoursand notable shows are attracting more visi-tors from the city, the nation and the world.In fact, Zugaza says “one of the ways we willexit the crisis in our country will come fromthe cultural sector. Spain has a very importantasset in its cultural heritage.…It generatesexcellent employment. It generates appealingactivities for tourists. It enriches the economicfabric around us. And it’s important that poli-ticians and society know this....Every 1,000visitors who come to the Prado generate onejob in Madrid.”
A writer embraces the “messy heteroge-
Suketu Mehta is author of Maximum City:Bombay Lost and Found, a forthcoming bookon New York, as well as many articles on the
of Brazil. Here he pauses amid travelsand teaching to explain the lure of urbanlife from many angles. “A young person inan Indian village moves to Bombay not justto make more money but because the city
caste doesn’t matter as much.” As for richcities like London, he warns “it doesn’t matter
an apartment there for a reasonable price,because you won’t be part of the city at all.That’s dangerous to the city’s well-being. Youneed the great middle class—good peoplewho will keep faith in the city duringa downturn.”
Yikes! Robots advance…Are we inno-
vating ourselves out of a day job?
Erik Brynjolfsson, director of MIT’sCenter for Digital Business and author ofThe Second Machine Age,on the pulse of economic and technologicalchange. Nowhere is “creative destruction”more potentially dramatic than the rise ofsmart machines and their ability to do ourjobs. How do cities and their citizens avoidfuture unemployment and potential socialunrest? Brynjolfsson says a number of jobswill be even more in demand: “One is creativework. The second is interpersonal interac-tions. And those are areas where cities canexcel. They can stoke creativity by bringingpeople together…They’re attracted partlyby the culture, partly by proximity to othercreative people. These people will be evenmore in demand in the next 10 years, and thesuccessful cities will be the ones that cultivateand attract them.”
12 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Approach
A global survey of PwC staff gives voiceto thousands of professionals in our 30 cities,adding valuable real-life input to our data
Cities of Opportunity has never been a staticreport. From year to year, we upgrade,enhance, and actively alter our methodologyand even our structure to examine urbanlife in a way that can help our 30 cities (andthrough them, cities in general) to under-stand the patterns and pathways towardbuilding healthy, prosperous communities.This year’s edition includes two notablechanges, in both method and structure.
First,edition published solely by PwC. Since it was
Cities of Opportunityhas been published jointly by PwC and thePartnership for New York City. This year,with a mayoral transition in New York for the
responsibility as the Partnership for New YorkCity focuses on, and helps to promote solu-tions for, the city’s core economic issues.
Cities of Opportunity 6 now includeselements from a global survey of 15,000PwC staff from every city in our report,which will shortly be released as part of aseparate urban demographic study—Cities
:(www.pwc.com/cities). Overall, an averageof 20 percent of the staff in each of our citiesresponded, telling us about their commutes,urban priorities, preferences for relocationwithin the 30-city sample, and spendingpatterns, among other revealing pointsof information.
This internal survey has been used to supple-ment and enhance our data collection withreal-life responses to a battery of questions,primarily about quality of urban life. Webelieve that this additional tool helps topragmatically anchor our data in the actualworking and living environments found ineach of our cities. We’ve always tried to frameour data within a context that illuminates themeaning behind the raw numbers; with ourPwC survey, we’ve gone farther in that direc-tion than ever before.
But there are also some salient continuitiesbetween this report and Cities of Opportunity5. In each edition of our study, we’ve exam-ined underlying issues affecting our cities.In the last one, we took a tremendous leapforward by projecting the economies, employ-ment patterns, and wealth of cities into thefuture through indicative forecasts, underseveral scenarios, of the global urban outlookin 2025. We continue with this “forwardvision” this year by projecting each city’sdemographic realities in 2025.
Moreover, the upcoming release of Cities ofOpportunity 6: We, the urban people(www.pwc.com/cities) will take a closelook at the current and 2025 demographicpatterns in our 30 cities, presenting agebreakdowns now and in 2025, as well as citycomparisons analyzing potential directions.The PwC survey adds insight on an importanturban demographic—the educated, workingprofessional all cities need to build the future.Finally, with so many cities around the worlddealing with problems of lonely aging, weinvestigate what some cities, including Seoul,Tokyo, and Stockholm, are doing to assureuseful, active lives for their older citizens.
In terms of continuity, the fundamentalthree criteria governing this report’schoices of cities have not changed at all.They focus on:
Capital market centers. All of the cities
regions, and many are hubs of commerce,communications, and culture, so that eachplays an important role locally but is also avital part of a global economic network.
Broad geographic sampling. While each
regionally, all of the cities form arepresentative international distribution.
Mature and emerging economies. Fifteenmature cities and 15 emerging ones areincluded this year, with four new cities addedand one removed. With a total of 30 cities,
enough to allow for an analysis that is bothdetailed and extensive but still substan-tial and inclusive enough—in geographicdistribution, population size, and overallwealth—to be representative.
This year’s total of 30 cities is the largestto date. Besides adding three cities, we’vereplaced Abu Dhabi with Dubai. Our newcities are Jakarta, Nairobi, and Rio de
given Indonesia’s growing wealth and role inthe G20 (as well as ASEAN) and its capital’scorresponding role in the country’s economy,contributing roughly a quarter of nationalgross domestic product.1
African city we’ve added since Johannesburgbecame part of the report in 2008. Kenya’scapital represents the dynamic growth andfuture prospects, both of its country and thecontinent as a whole. Finally, Rio de Janeirojoins São Paulo in this year’s edition inrecognition of its economic power in Brazil(second only to São Paulo), as well as itsenormous cultural vigor and impact globally.
city to be chosen to host a summer Olympics(in 2016).
As with our last report, the data this yearwere normalized where appropriate, mini-mizing the likelihood of a city doing wellsolely because of size or historic strength.This process eliminated the need to differ-
raw power (such as the number of foreignembassies or foreign direct investment) and
ï Ò¿¬·±²¿´ ¼¿¬¿ º±® îðïî ¿®» º®±³ ¬¸» ɱ®´¼ Þ¿²µ ¿¬ ¸¬¬°æññ¼¿¬¿ò©±®´¼¾¿²µò±®¹ñ½±«²¬®§ñ·²¼±²»·¿å ¼¿¬¿ º±® Ö¿µ¿®¬¿ º±® îðïï�îðïî
¿®» º®±³ ̸» Þ®±±µ·²¹ ײ¬·¬«¬·±² ¿¬ ¸¬¬°æññ©©©ò¾®±±µ·²¹ò»¼«ñ®»»¿®½¸ñ·²¬»®¿½¬·ª»ñ¹´±¾¿´ó³»¬®±ó³±²·¬±®óíò
Ѫ»®ª·»© ¤ 13
its quality or intensity (such as percent ofpopulation with higher education). Now,more variables are stated in a way that isnormalized for either land area or populationthan in previous editions.
And in regard to land area, Cities ofOpportunity uses each city’s own strict
whenever possible, not its metropolitanregion. So, to give just two famous examples,
opposed to its greater metropolitan area,-
and not the wider Île-de-France region.
While the 59 variables constituting the 10indicator groups are the same number as inour last report, more than a dozen variableshave been deleted or altered, and more thanhalf a dozen new ones have been added, somebased on our PwC staff survey. The only twoindicators that remain unchanged from Citiesof Opportunity 5 are technology readiness andtransportation and infrastructure.
directly from our PwC staff survey is demo-graphics and livability. Its last two variables,ease of commute and relocation attractive-ness, have been calculated based on theresponses of the PwC professionals in the30 cities of opportunity.
Our own survey notwithstanding, however,Cities of Opportunity is mostly based onpublicly available information supported byextensive research. Three main sources areused to collect the relevant data:
• Global multilateral development orga-
nizations, such as the World Bank and the
International Monetary Fund
• National statistics organizations, such as
UK National Statistics and the US Census
Bureau
• Commercial data providers
The data were collected during 2013 and, inthe majority of cases, during the latter half ofthe year.
In some cases, national data are used as aproxy for municipal data. Use of nationaldata tends to disadvantage the 30 cities inour study, all of which are either national
that tend to outperform national averages inmeasures of socioeconomic advancement.This effect might be more pronounced indeveloping economies and in those with largerrural populations. Nonetheless, as consistentcomparisons across all cities are critical toassure objectivity, country-level data are usedwhen other consistent, highly reliable sourcesof publicly available information are eitherunavailable or neutral—as in visa require-ments, which are obviously the same for allcities in a country—for all 30 cities.
The scoring methodology was developedto enable transparency and simplicityfor readers, as well as comparability acrosscities. The output makes for a robust set ofresults and a strong foundation for analysisand discussion.
In attempting to score cities based on rela-tive performance, we decided at the outsetof our process that maximum transpar-ency and simplicity required that we avoidoverly complicated weightings of variables.Consequently, each is treated with equalimportance and thus weighted equally. Thisapproach makes the study easy to understandand use by business leaders, academics, poli-cymakers, and laypersons alike.
Taking the data for each individual vari-able, the 30 cities are sorted from the bestperforming to the worst. They are thenassigned a score from 30 (best performing)to 1 (worst performing). In the case of a tie,they are assigned the same score.
Once all 59 variables are ranked and scored,they are placed into their 10 indicators (forexample, economic clout or demographicsand livability). Within each group, the vari-able scores are then summed to produce anoverall indicator score for that topic. Thisproduces 10 indicator league tables thatdisplay the relative performance of all 30cities of opportunity. The overall table is thesum of performance in all 59 variables.
14 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
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Tools for a changing world
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Smart, prepared and open: The keys to moderncity building repeat age-old truths
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The three indicators in this section—intel-lectual capital and innovation; technologyreadiness; and city gateway—represent agroup of criteria with a very long historicalrelation to the growth of cities.
But, as Heraclitus famously said, “all thingsmove and nothing remains still,” even morefamously concluding that one can never “steptwice into the same stream.”2 Keeping upwith change is, therefore, not simply prudentbusiness practice. It is part and parcel of thehuman condition and of course the evolution
last few years has made that painfully clearin many cities, especially in Europe. Changemight be good or bad, but it is inevitable.
and foremost, on intellectual advance,which, at least since antiquity, has includedscience and technology. Plato’s Academywas founded in the fourth century B.C., aswas Aristotle’s Lyceum. Both the universi-ties of Paris and Oxford were founded inthe 12th century. New York’s Columbiawas established almost 30 years before theUnited States (ironically, as King’s College),the University of Berlin over 50 years beforemodern Germany, and the University ofMumbai a hundred years before India.
But while education and science have alwaysdriven urban development, they have alsohistorically required another natural elementto make them engines of growth: access tonavigable water (today, obviously, supple-mented by good air and high-speed railconnections). In fact, 27 of our 30 cities areon seacoasts, lakefronts, or, above all, river-banks (or a combination thereof). As for theremaining three, Mexico City was originallybuilt on a lake, and Milan began constructingits now picturesque , or canals, inthe 12th century, using them ultimately toexpand its trade. Indeed, only Johannesburg
apparently has no aquatic history (theWitwatersrand notwithstanding) and is actu-ally the world’s largest city not located on anavigable body of water.
Thus, a vibrant town transforms itself into acity of opportunity largely by a combinationof education, technology, and openness to theworld—that is, interaction with, and a will-ingness to become a to, the rest ofthe globe. It is noteworthy that three cities—each from a different continent—performwith remarkable reliability across the board.
top 10 in all three indicators. Even more-
tors, technology readiness (tied with Seoul)and city gateway, and second in the lastone, intellectual capital and innovation—animpressive demonstration of excellence andconsistency at the very highest level.
It is not surprising that London does sowell, given its long history in each of thesethree indicators, nor that New York is theonly North American city and Tokyo the onlyAsian one to rank in the top 10 in all three.Indeed, the geographical equality among our
the fact that seven cities—two from Europe,three from North America, and two from
indicators in this section. Paris and Stockholm;Chicago, Los Angeles, and San Francisco; andHong Kong and Singapore all perform well inmost of the variables in all three indicators.
In the end, what is most telling in this sectionis that, out of the total of 17 cities in the top10 across all three indicators, 10 cities rank inthe top 10 in at least two. Again, no surpriseshere. Intellectual capital, technology develop-ment, and an openness to the world havedistinguished all 10 of these cities, large orsmall, West or East, Old World or New, for avery long time.
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The importance of this indicator for a21st-century economy is obvious and can’t
its variables, year in and year out, sometimeswith substantive changes, sometimes withminor ones. This year’s report involves justtwo changes, one really an attempt to adjustan existing variable to make it even moreaccurate, while the other is a more basic deci-sion to eliminate a possible “false positive.”
The potential “false positive” refers toclassroom size, a variable we included inprevious reports but have now deleted. Theconcept itself is fraught with controversyamong educators and educational special-ists, both in regard to its general effect oneducation and to the actual ages of studentsupon whom it might (or might not) make adifference—with both sides citing research infavor of their respective positions. Therefore,we decided to eliminate it. If nothing else,the triennial PISA tests administered bythe OECD, whose most recent results werereleased in December 2013, have added tothe international pedagogical debate, giventhat Shanghai’s 15-year-olds once again beatthe entire world (as they did in the tests threeyears earlier) despite the fact that the city’sschools do not have particularly small classes.
The other change is, essentially, an upgrade.In our last report, we included a variablemeasuring research performance of top
number of articles published by a univer-sity’s faculty, number of citations of relevantpublications, and quantity of highly citedpapers. This measure ignored the humani-ties as a whole, however, while favoringlarge institutions, universities with medicalschools, and institutions primarily focusedon the sciences. Our current report replacesthat particular variable with the highly (andglobally) respected Times Higher EducationWorld University Rankings, which is a morecomprehensive and inclusive ranking of theworld’s institutions of higher education that,in addition to the criteria mentioned above,uses others as well, including peer reputationof an institution’s teaching and research.
year’s report, some in line with previous
is that Paris now ranks at the very top inthis indicator, overtaking Stockholm, which
had maintained the #1 ranking through ourtwo prior reports. Indeed, Sweden’s capitalcurrently falls to fourth place, behind #2London and #3 San Francisco. Moreover,
eight variables, it ranks consistently highly in
four, and just falling out of the top 10 (#11)in only two.
London’s rise to #2 in this report from #6in our last one is also impressive—especiallybecause only a few points separate it from #1.London’s top spot in world university rank-
its connections to some of the most storiededucational institutions in the world.
San Francisco’s rise in this indicator to #3(from #4 in 2012) is also striking. Threeresults stand out in particular: The city ranksat the very top in entrepreneurial environ-ment and #2 in both percentage of itspopulation with higher education and theInnovation Cities Index.
#3—with San Francisco—in this indicatorin Cities of Opportunity 4, #5 in our previousreport, and #6 in the current one. Any result
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in the top 10 is of course a very good one, butstill, the city might at least look to stabilizingits overall ranking in this extremely importantindicator. To be fair, however, its worst resultscome in the two variables that use nationaldata (math/science skills and intellectualproperty protection) in this indicator.
Finally, again in this report, as in our lasttwo, Tokyo is the only Asian city in the top10. As dynamic as so many of Asia’s citiesare, this is one area in which they can greatlyenhance their competitiveness. The sameholds true for the emerging cities of LatinAmerica and Africa.
What distinguishes intellectual capitaland innovation is that it is not merely a gaugeof technical (or technological) progress, orsocial development, or economic growth, orcultural advance, or major improvement inquality of life. It is all of these things, togetherand simultaneously. Investment in intel-lectual capital leads to an almost universalenhancement of urban society—indeed, ofsociety generally. That is why it is hardlycoincidental that the cities that do best in thisindicator are also the richest cities, as wellas those that so many people throughout theworld consider to be the most desirable placesin which to live.
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Innovation, entrepreneurism, andsustainability spur Stockholm…according to deputy mayor Ulla Hamilton
the environment, Ulla Hamilton has played a leading role in some ofthe city’s greatest successes, including development of Stockholm’sbroadband network, auto congestion pricing plan, and sustainablehousing. Here she discusses those and other efforts to keep the citygrowing and healthy.
Stockholm is admired around theworld for style, sustainability, andopenness. What are Stockholm’sgreatest achievements?
Stockholm is one of the fastestgrowing cities in Europe. Onpopulation, it is bigger than everand growing. New businessesare springing up, and it’s a verycreative city. It’s a big changefrom 10 or 15 years ago.
What is Stockholm doing rightto attract and keep people?
We have a lot of interestingcompanies and interestingjobs. Combine that with thecity overall—we have good
restaurants with great chefs,entertainment, closeness tonature, both in terms of greeneryand water. It is a combinationof things.
What government programsmake Stockholm so attractive?
Sustainable development is veryimportant. Also, we developeda broadband network in themid-1990s, and that has led to abooming ICT (information andcommunications technology)industry, the development of gamecompanies like DICE and Spotify.
whomever needs to rent capacity.
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How did Stockholm put in theinformation and communica-tions spine without it costingStockholmers anything?
I was vice chairman of thecompany when we discussed howto develop the business idea. Itwas part of an existing network,a cable network that was
We thought that small companiesthat couldn’t afford to develop asystem on their own could hirethe capacity they needed. Nowthe network covers more than 90percent of the Stockholm area.
So this is a case where publicinvestment in infrastructuredrove the health of the economy?
Yes. And we didn’t use anytaxpayers’ money, because wekept it affordable. We let compa-nies rent the capacity, and wedidn’t develop the system untilwe had customers.
Do you think investment in infra-structure generally drives growthor does growth occur and thenyou invest in infrastructure?
I think that investment ininfrastructure is very importantin order to get growth.
What would you do to improveStockholm further?
We should use the tools that wehave today to better developeducation. We have the gameindustry. You can use, for
as a tool to push innovation ineducation. Young people areused to having smartphones andinformation communicationstechnology all around them. Youhave to have something in educa-tion that connects to that.
Stockholm has done well in Citiesof Opportunity for the past threeyears in areas like sustainability,health and safety, and intellectualcapital and innovation. Whatexplains Stockholm’s excellentstanding?
On sustainability, that goes wayback. Stockholm was named
in 2010. And that was becausewe’ve been dealing with sustain-ability for a long time. In the1920s, people began to beinterested in how to create greenareas in a growing city. Thatinterest has continued, and thecity has been developed in agreen way.
The city has been so dependenton clean water, and LakeMälaren, which surroundsStockholm, is our drinking waterreservoir. So it has always beenvery important to take care of theenvironment, and to do that, youhave to have smart engineeringsolutions. Beginning in the 1940swe built a big water treatmentplant. We started early to developthe subway, and a big percentageof people use public transport.We developed the district heatingsystem in the early 1950s. These
are engineering solutions butalso environmentally friendlysolutions.
In Sweden, what is the balanceof power between the cityand regional and nationalgovernments?
between the city and the nationalgovernment and that goes forevery country. But it’s importantthat we as a growing city,thanks to the tax structure,keep much of our tax money.It’s a good situation.
How will you continue to spurinnovation and entrepreneurism?
We are lucky in this area forseveral reasons. We have a veryinteresting mixture of life sciencecompanies, ICT companies,clean tech companies, and theentertainment industries. AndStockholm is a fairly small city,so it’s easy for executives andinnovators to meet one another.And that creates a creative,innovative climate. Also, Swedesare very interested in solvingproblems, and it has becomefashionable to start theirown companies.
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Universities and high schoolshave become interested inhelping students begin theirown companies. Before that, theuniversities were more focusedon producing academics. Nowwe have very close cooperationamong businesses, theuniversities, and the city.
Considering not just Stockholm,but Malmö, Uppsala, Gothenburg,and other cities, what doesgovernment do to fosterinnovation?
arenas where people can meet toexchange ideas. But a politicianmust know when not to interfereand disturb development. It’svery important to understandthe government’s role. Also inStockholm, we have open dataresources, so companies—andStockholmers as well— candevelop websites, or apps, orother business ideas.
Small businesses created 800,000jobs in Sweden from 1990 to 2012
twice what Sweden had in 1990.What explains that, and what partis government playing?
There has been a big changein Sweden since the presentgovernment took over in 2006.
During the past decade, avoucher system was created forelderly care, healthcare, schools,and so on. That led more peopleto consider starting their owncompanies rather than justbeing employees. So it was acombination of things.
It’s been a tremendous changesince the 1970s, when we had abig state and the attitude was thewelfare state should take care ofyou. Today’s voucher system hasprovided the opportunity for bigand small companies to provideservices rather than the govern-ment doing so. The competitionin the service area brings devel-opment and productivity.
Speaking of public-privatepartnerships, do you think
things like building a hospitalis a good thing?
The county council in Stockholmis right now building a newhospital. And it’s a public-privatepartnership with the constructioncompany Skanska. That’s oneexample where the public sectorand the private sector can work
effective solutions.
Stockholm is growing.Immigrants are coming, andSwedes are doing their dutymaking more Swedes. Is therea threat of unemployment astechnology makes manyjobs obsolete?
No. Technical development alsoleads to development of services.So I don’t see that as a threat.Actually, the risk is that the citydoesn’t grow. In a growing city,you will always have develop-ment of new businesses. I’mabsolutely sure of that. Five yearsfrom now, we will have quite a lotof different services that we can’teven imagine today. Just look atthe growth of the smartphone,for example.
How do you integrate immigrantsinto the labor force?
That’s a very big challenge, butwe are trying hard to see thatimmigrants can start workingas soon as possible. We haveprograms where people with
Swedish and work at the sametime. We also have programswhere, for example, engineeringcompanies connect with trainedengineers who recently moved toStockholm. That makes it easierfor immigrants to become part ofSwedish society.
What is Stockholm doing to ease
The challenge is that the city isbuilt on islands. Whether yourcity is big or small, there are ways
have to regulate to avoid chaos.In Stockholm, we are promotingbicycling and walking as thebest ways to move around thecity, and having as many peopleas possible leaving their cars athome when they go to work. Todo that, you have to give morespace for buses, for example,and give more space for bicyclesand pedestrians.
What is your thinking on thefuture of Stockholm in terms ofpopulation growth? Good or bad?
It’s good because the alternativeis very bad. To be competitive, tobe creative and innovative, it’scrucial that the city grow. Butwe have to grow in a sustain-able way. We have to havegreen areas, and people like thecloseness to nature. It’s a toughchallenge.
Learn more
-
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Technology readinessThe digital divide continues to
separate many cities, especially
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While all four of this indicator’s variablesremain the same, the respective methods fordetermining two of them have been changed
Regarding broadband quality, we’ve replacedthe data from the annual Broadband QualityStudy produced by Oxford’s Saïd BusinessSchool and the University of Oviedo (andsponsored by Cisco Systems), which is nolonger being published, by the data compiled
by Ookla, which compares and ranks broad-band quality worldwide. For the software andmultimedia variable, we’ve added a majornew source of data, from the World Bank,
it by adding another analytical element tothe measurement.
Given that this indicator has the smallestamount of variables, even limited changeswill produce considerable differences. What
-cant changes still take place within the top 10performers—which remain the same overall,although their ranking has altered.
Most obviously, London has leaped fromeighth in our last report to the top of the rank-ings in our current one, tying Seoul, which
Cities ofOpportunity 5. Stockholm has also improved,
last time), although the city that makes theother enormous jump—just under London’sseven places—is Hong Kong, soaring from #10in our last report to #4 in this one. Meanwhile,Berlin rises to #12 this year from #16 in ourlast report despite the presence of more cities
rising reputation as a high-tech hub in Europe.
There is, however, one variable in which twomature cities score less well than one wouldnormally expect. In Internet access in schools,
results are incongruous, especially as both
and innovation.
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Big data…big city…big dreams
Scientists and economists peer through a powerful newlooking glass in the age of urban informatics
At the temporary headquarters of New YorkUniversity’s (NYU) Center for Urban Scienceand Progress (CUSP) in downtown Brooklyn,economist Tim Savage stands beside a room-sized array of screens displaying a map ofManhattan, as well as parts of Brooklyn. Themap resembles a radar image of storm inten-
East and West sides of Manhattan, the picture
of taxi pickups and drop-offs (and what somelocals might describe as the heat of tempersin the sidewalk scrum to hail a cab on a rainynight). In fact, the giant display does repre-sent a storm of sorts—a vast set of data pointsthat depict nearly 180 million taxi rides thatoccurred in 2011 in Manhattan, Brooklyn,Queens, the Bronx, and Staten Island—the
This is, in effect, a taxi maelstrom. It’s onethat, like other experiments in the convergingresearch worlds of big data analytics andurban informatics, can now be dissected andanalyzed so that previously hidden patterns
-tion—can be better understood, remedied,and, as researchers like Savage hope, adoptedand used by other cities around the world.
As part of a New York City Applied SciencesInitiative that began four years ago underformer Mayor Michael Bloomberg, CUSP is
laboratories/ventures around the worlddedicated to tracking patterns of behavior
community health.
Looking out over Brooklyn and Manhattan,the CUSP facility, in its way, is perched on thefrontiers of what’s been called the Internet ofthings, or the machine to machine revolution.
In an age of increasing hyper-connectivity
management and analysis—the big datarevolution—are being studied and deployed
and governmental ecosystems—everything
building operations. In 2012, CUSP won agrant offered by New York City (after Cornell
own city-focused research facility, the CornellTechnion campus on Roosevelt Island in theEast River off Manhattan). By 2017, CUSPplans to move into its permanent home on JayStreet in the heart of downtown Brooklyn.With a new one-year graduate programin applied urban science and informaticsrecently launched, industry partnershipsforming with IBM and Cisco, among others,and collaborative research facilities locatedin Mumbai, India, and at the University ofWarwick in Coventry, England, things aremoving very quickly.
The Mumbai research facility opened inSeptember, and Warwick’s Institute forthe Science of Cities launched January
according to Steven Koonin, a theoreticalphysicist who is CUSP director and previouslywas US under secretary for science at theDepartment of Energy, that his researchersare clamoring to meet with colleagues else-where—the Boston Area Research Initiative,the Urban Center for Computation and Datain Chicago, and the Center for AdvancedSpatial Analysis in London—just to betterunderstand each others’ areas of focus andbetter align efforts.
The explosive growth in urban researchfacilities comes at a time of global demo-graphic change, a great urban shift in whichthe UN projects that 67 percent of the global
population will live in an urban environment
North America).3 City problems will increas-ingly be almost everyone’s problems.
At the same time, a technological revolutionis under wayrealm that has emerged as researchers lookfor ways to manage the colossal amounts ofinformation generated by an interconnectedworld. In 2017, for instance, the gigabyteequivalent of all movies ever made will crossglobal Internet Protocol networks every threeminutes, according to a recent Cisco study.4
The great data shift, in other words, is sobig it has required the development of anew generation of database managementsystems, like Apache Hadoop, and datascientists who can roam the vast universeof big data. The goal of data managementat this scale is to glimpse opportunities to
also to “see” into the future.
As it turns out, harvesting and analyzing dataat this scale can allow researchers to anticipateevents and trends in human behavior usingalgorithms and other methods. And this sort ofpredictive analytics can be used to spot health
congestion, trends in energy use and buildingoccupation, patterns of noise complaints—themost common complaint in New York City.Anticipating these trends can help city plan-ners and managers marshal their resourcesmore effectively and better evaluate programsto improve city social and economic life.
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“Cities are where resources areconcentrated, where economic activityhappens, and where innovation occurs,”says Koonin. Because cities will increasinglycompete for global talent and capital, and
play a big role in global climate issues,
be.” Nowhere is this more apparent thanin the application of big data solutions tourban problems.
Koonin points to early successes— asexamples of the promise of urban informatics.5
These include advances in predictive policing,
of building code violations, in estimatedimprovements of water and electricityusage of between 30 percent and 50 percentover the coming decade. The more you can“instrument a city,” as Koonin describesit—place sensors, gather, and analyze itsdata—the better you can make a city run.
Take the taxi study. CUSP is working withNYU’s engineering school on this project.As it happens, the New York City Taxi andLimousine Commission has been, over theyears, proactively using in situ sensors inits 13,347 regular medallion taxis to collectinformation about pickup and drop-off loca-tions, time of travel, speed of travel, numberof passengers per ride, the amount of faresand tips, and a few other things. “It’s a prettyrich source of information,” says Savage, whohas analyzed all that taxi data. Some of hisresults highlight a problem that lies mostlyhidden from view—nearly 70 percent ofcab rides have just one passenger, travelingan average distance of just over two miles,frequently at a speed that is only slightly
faster “than someone walking down thestreet at a brisk pace.” Such data reveal “aclassic example in economics of a negativeexternality,” says Savage. “In a world wherewe don’t price the streets, time is the equili-brating factor.” The seeming convenienceof hopping in an inexpensive taxi ride (thestudy shows that the average cost to go onemile is just $5.26) is overshadowed by greatersocietal costs—the time that gets wasted by
caused, in part, by so many taxis.
Koonin sees “science with a social dimen-sion” as the promise of the age of urbaninformaticsurban challenges as the ability for the publicto see and understand its own behaviorin aggregate, to discern the “shape of the
-cies: regulation, economic incentives, and theexploration of choice architectures. “Thesesocietal levers are often more important thantechnological solutions,” says Koonin.
In the taxi example, for instance, one type ofsolution that could emerge is the applicationof economic incentives: Slightly higher taxifares would put a real value on city streets,incentivizing more people to use subway andbus services. Koonin adds that facilities likeCUSP will be able to use computer models tosee which choices will work best for the mostpeople. Koonin points to the challenges thatthe city of London had when it implementedcongestion pricing. The price signal was sostrong, according to Koonin, that many morepeople than expected stopped driving into thecity, which then lost revenue it expected to
make from the pricing scheme—revenue thatwas intended to support the subway system.By contrast, an instrumented city, accordingto Koonin, with data points gatheredthroughout its infrastructure, will be able totest a variety of incentivizing options, usingcomputer models in advance, “test driving”options to see which policy ideas work best—before they are implemented.
-lenge, according to Koonin, which involvestargeting and making interoperable three
data acquired in situ, like the taxi sensors,and would involve installing more sensorsto measure subway or building occupancy
or energy use. A second set involves whatKoonin calls “organic data”—all the types ofrecords a city normally keeps as part of itsdaily operations. Getting access to all of thisinformation, cleaning it up, and making itinteroperable is a monumental effort.
“We’re working our way through severalthousand data sets,” says Koonin—“all thebuildings, all the ZIP codes, all the 311 calls[to New York City’s information line], allthe building energy use data.” With strictmandates and protocols in place for privacyand security, city data will eventually be usedin correlation with a third and more futuristicmethod of data gathering—“synoptic data,”which will involve specialized instrumentsmounted on the rooftops of buildings—amethodology that distinguishes CUSP fromother research facilities around the world.Koonin calls it the “urban observatory.”
As Galileo pointed his telescope into theheavens to usher in the Copernican revo-lution, so researchers at CUSP and otherfacilities like it may be on the verge of arevolution in the big data universe, inspiredby specialized telescopes, exoplanets andcameras pointing downward, across swathsof a city to measure and analyze the infraredsignature of entire neighborhoods or indi-
their energy use.
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Hyper-spectral imaging mounted on tallbuildings will one day be correlated with cityrecords—the “organic data” of utility bills,for instance—to enable city managers, at amoment’s glance, to analyze and even predict
a form of laser technology, will measure themovement in buildings (and then extrapolateoccupancy) or will identify particulatepollution in the atmosphere. Other instru-ments that measure magnetic variation mayeventually be used to track the movement oftrains through the city.
For now, Koonin has his hands full. Thereare research projects in transit, utilities,
and public health to manage. There is thedevelopment of an urban informatics Ph.D.
science fueled by big data to ponder. Thereare academic and industry partnershipsto nurture. And there is a “living labora-tory” to establish—a completely wired andsensored neighborhood of about 20 blocks inManhattan. And there are new opportunitiesto test and develop urban informatics prod-
nobody has yet estimated the potential sizeof the market, though, according to CUSP’sMichael Holland, investment in “civic tech”of the sort that will help instrument cities of
the future has already garnered more than$430 million from private sector investorsand foundations between January 2011 andMay 2013.6
All in all, the work of CUSP and otherresearch labs like it will maintain a primaryfocus on big data’s ability to improve lifein cities. As Koonin likes to say, quoting hisfriend, the theoretical physicist GeoffreyWest, “Cities are the cause of our problemsand the source of the solutions.”
28 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
As cities hone inon the promise of big data…they’re often lost in the sauce of big government,explains Steven Koonin
Steven Koonin, founding director of NYU’s Center for Urban Scienceand Progress (CUSP), served as under secretary for science at theUS Department of Energy from May 2009 through November 2011,overseeing technical activities across the department’s science, energy,and security activities. Before joining the government, Koonin spent
physics at California Institute of Technology from 1975–2006. He isa member of the US National Academy of Sciences and the JASONadvisory group.
Let’s talk about privacy and secu-rity of data. What is it that peopletend to misunderstand the mostabout what research facilities aretrying to do with big data?
First, privacy and security haveemerged as a key research topicfor CUSP, because it’s so essen-tial in letting us do the urbanresearch that we want to do.And that’s central: CUSP is aresearch institution. We’re nota company, although we workclosely with companies. We’renot part of the government.
Second, as a research institution,we are subject to independentoversight by NYU’s institutionalreview board under the federalPolicy for the Protection ofHuman Subjects.
Third, we are, of course, notinterested in individuals. We’reinterested in aggregate behavior.And we’ve got a set of policiesthat make that very explicit.Finally, we’re beginning a largerdialogue about privacy andsecurity in a broader academiccontext, sponsoring a conferencein June [2014] and publishing,
,this coming June [2014].
If, as your taxi study shows, urbaninformatics can make plain certain
then changing those behaviorswould seem to require a revolu-tion in regulation, compliance,and enforcement. Are we movinginto an era of greater regulation ofindividual behaviors?
I would say it’s a greaterawareness of individualbehaviors. It doesn’t have tohappen through regulation.There’s a whole discussion ofnudges or, to use a fancier term,“choice architectures,” that
but are not actually regulation.We see choice architecture atwork with organ donorship anddriver’s licenses, for example. If
you ask people if they want tobe an organ donor, perhaps 20percent choose to do so whenthey sign up for their license. Butwhen you make your targetedbehavior the default option—and oblige people to opt outof the donor program, thendonorship increases. It’s a simple,non-regulatory mechanism thattargets optimal behavior.
If everyone will soon be living incities, won’t federal or nationalgovernments have an increasinginterest in helping to providesolutions that will help cities
or incentivizing big data orurban informatics solutions,for instance, or subsidizing the
electric grid support and watersystems that will become the“smart city” of the future?
Cities qua cities don’t have greatvisibility in the [US] federalgovernment. Yes, there’s Housingand Urban Development, but it isconcerned with one small slice ofcities. There is certainly Healthand Human Services, concernedwith the public health aspectsof cities and medical care. Andthen you’ve got transportation,and so on, but there is no placein the federal government thatthinks about cities as systems ofsystems—no federal entity thatfunds, regulates, and encouragescities as systems of systems.
̱±´ º±® ¿ ½¸¿²¹·²¹ ©±®´¼ ¤ 29
And do you see this changing?
I would like it to change. I andothers have been talking inWashington to see if we can getcity-focused initiatives cross-cut across the various agencies.Not to look with envy, but theDepartment of Agriculture, forexample, is very much concernedwith rural affairs, as one mightwell imagine, but there is nothingcomparable in an integrated wayfor the interests of cities. Again,not to complain but just to statea fact—cities are legal entitiesof state governments, so this isa result of how the Constitutionapportions power to the states.
Can you speak to the questionof how the smart city solutionsthat you’re creating at CUSPwill be deployed in developingcities? What solutions seem tobe the most likely candidates fordeveloping cities?
One of the advantages of thedeveloping countries is that theinfrastructure is largely yet to bebuilt. So you could try to buildsome of this in from the begin-ning. And synoptic observationtechniques that we’re developingfor cities, where you can watchthe broad swath of a city from anurban vantage point, may havesome real advantages in the devel-oping world, because you cancover large areas without havingto put in a sensor infrastructure.
What advantages will NewYorkers gain from CUSP in10 to 20 years?
First, one goal for CUSP is to just
York City has already made theenforcement of illegal building
about the city in people’s hands,you can improve the quality of life.Noise levels are something thatwe’re quite interested in. If peopleunderstand, in a more detailedand quantitative way, the noisierparts of the city, you can modulateyour living and travel. Real estateprices will no doubt change asa result of what the noise scoreslook like.
As you’ve said elsewhere, theshape of the future is urbanized,but the current paradigm, inwhich the federal government haslong had an interest in encour-aging economic growth, is, infact, based on an agrarian world.
Absolutely. And I’m no expert onpolitics or political theory, butone can imagine that the idea ofchanging this paradigm wouldcause a lot of—let me just say—discussion, in Washington.
30 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
City gateway
A substitution of one variable and the additionof a new one have led to meaningful changes
of its original data points remain.
The two new variables are top 100 airports(based on a ranking compiled from asurvey of more than 12 million passengers
(measured by the average percentage of
May–July 2013). The one variable from ourlast report that was deleted was aircraftmovements, as the data generated from itwere simply too similar to those of incoming/
redundant. (It also doubly rewarded citiesthat did well in the latter variable whilepenalizing those that did not).
-cator highlights London’s dominance even
in Cities of Opportunity 5, we stated that itsresults were best read as a complement tothose in the demographics and livabilityindicator, and vice versa, as this section ofour report attempts to quantify both a city’sglobal connections and, even more so, itsattraction to the world way beyond its ownregion and even national borders. Indeed,
with a more conspicuous margin of victorythan in Cities of Opportunity 5—reinforces(and in fact validates) its #1 ranking in globalattractiveness in the livability indicator.What is perhaps even more interesting thanLondon’s pre-eminence here, however, is thetrajectory of two other cities with which it isoften linked.
“When it comes to the world’s most attrac-tive cities for tourists,” we wrote in our lastreport, “the popular Western consensushas long accepted the trinity of London,Paris, and New York.” This year, we received
cities attractive but our own professionals,who voted London and New York #1 and
#2, respectively, as the cities to which they’drelocate if offered the chance (with Paris arespectable #5). It is notable, therefore, that
by a difference of only two points in our lastreport, ranks seventh in this one and that
Shanghai for ninth place this year. In fact,London is the only non-Asian city in the top
Nevertheless, we notice the same phenom-enon in this indicator that we’ve noticed in
variables might be altered, dropped, or added,the cities in the ranks of the top 10 remainremarkably unchanged, barring an occasionalcity rising or falling. Thus, nine of the citiesin the top 10 this year were in the top 10 inour last report, the only exception being LosAngeles, which is now replaced by Dubai.
Clearly, the most successful cities, yearin and year out, are those that possess—orhave learned to create and manage—the kindof deep social and economic resources, andan almost perpetual resiliency, that allowsthem to stay “in the game” for the long run.What is perhaps the most impressive, andcertainly surprising, example of that inherent,long-term urban fortitude and tenacity isthe city in sixth place this year—which wasalso in sixth place in our last report: Madrid.Among such global powerhouses as London,Beijing, Singapore, and Tokyo, Madrid standsout. As the highest-ranked non-Asian cityafter London here, it beats out Paris andNew York. Given the tremendous and variedchallenges to the Spanish capital during thelast few years, it is a testament to its essentialstrengths that it continues to do so well inthis indicator—which surely bodes well forits future. In the words of Miguel Zugaza,director of the Prado Museum, a crisis“undresses a country. It leaves you naked”(see pages 44–47). But after taking away “allthe accessories, all the jewels,” the currentcrisis will leave Madrid, and Spain as a whole,the “nucleus for the future, the strength ofwhat it has.”
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Quality of life
Ï«¿´·¬§ ±º ´·º» ¤ 33
Attaining top infrastructure, sustainability,livability, and health is anything but a walkin the park
This section groups four of our 10 indica-tors that, together, determine a city’s qualityof life. As the reader will quickly notice, afundamental factor in urban quality of life isinfrastructure, from mass transit and housingto hospitals to waste management and publicparks. The development, upgrading, andcontinual maintenance of infrastructurecontribute enormously and to a city’squality of urban life, enhancing not only thedaily lives of residents but a city’s appeal tothe wider world at large. This very basic and
living helps explain why the top rankings in
cities of opportunity.
Three-quarters of the top 10 places in thesefour indicators (30 out of 40) are held byEuropean or North American cities, with theformer taking the largest chunk (17 out of40). Even more impressively for Europe, threeof the four cities in the top 10 in all four indi-
on all variables) Stockholm, Berlin, and Paris,with Toronto being the sole North Americancity in the group (and scoring above Paris).In addition to the four cities above that do
cities rank in the top 10 in three of the fourindicators: They are (again, in decliningcumulative score) Sydney, Singapore, SanFrancisco, London, and Chicago. While thegeographical breadth here is more extensivethan with the previous four cities, coveringAsia, Australia, Europe, and North America,there are a couple of notable similarities
in the top 10 in the same three indicators,which means that they also all fall out of thetop 10 in the same indicator: transportation
and infrastructure. Singapore and London-
tors, but the indicator in which they fall outof the top 10 is, interestingly, sustainabilityand the natural environment. This last
normally expect two cities as sophisticatedand advanced as Singapore and London to beamong the leaders, both regionally and glob-ally, in environmental sustainability.
But another result seems even more unex-pected. In this section, which evaluates allthose urban assets and policies that consti-tute a consistently high quality of city living,New York ranks in the top 10 in only twoindicators. Moreover, in both cases, New Yorkjust about squeezes into that select group,
and tying Chicago for 10th in demographicsand livability. Given Paris’s success in all fourindicators and London’s ability to rise to thetop in three out of the four (just to mentiontwo conspicuous global peers), New York’srankings in this section are surprising. Theyare made even more so by the fact that NewYork was chosen as the #2 city for relocationin our PwC staff survey of 15,000 profes-sionals in our 30 cities.
The only other city besides New York to-
tors in this section is, surprisingly, Madrid.But as we state in our city gateway indicator(page 30), where Madrid ranks sixth overall,what is probably most impressive about theSpanish capital is how it manages to “standout” among the global powerhouses in Citiesof Opportunity. To echo the words of MiguelZugaza, director of the Prado Museum, thecrisis it has gone through the last few years
and resiliency (see pages 44–47).
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Transportation and infrastructure
Singapore blazes the trail in urban mobility
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As with several other indicators, while we’vemaintained the same variables in this one,
therefore, the measurements—of two of themand, in so doing, we believe, substantiallyimproved them. These two adjustments haveled to considerable reordering of our rank-ings, both within the top 10 and throughoutthe indicator generally.
-port variable, which now measures the priceof a trip from a city’s farthest boundary to thecentral business district (CBD) rather thanmeasuring from farthest boundary to farthestboundary, as we did in the past. This seems tobe a fairer measurement, both intuitively andpractically, not only for travelers and touristsbut for most residents of a city, who normallytravel to places of work or amusement in thecenter but rarely (if ever) undertake journeysfrom one end of a city to the other.
The second change we’ve made this year isto the variable comparing major construc-tion activity. Under our previous measure,certain cities seemed to register unusuallylow activity, even in the face of anecdotalevidence to the contrary. We now use datafrom a global provider of building informa-tion that seems to be more robust and givesa more accurate accounting of activity eitherunder way or planned.
While no changes have been made to themeasurement criteria from previous years, itis also worth noting that the public transport
congestion and ease of commute. Thesefactors are addressed individually in ourdemographics and livability indicator cate-gory in order to consider the range of dailychallenges that many urban citizens face.In light of this, our public transport systems
-ence of transit options at the foundational
-tion or ease of commute factors.
For example, while Toronto is rated here as#1 for public transport systems, it is impor-
congestion and #12 for ease of commutewithin our demographics and livabilityindicator. Toronto’s rankings in these two
in which the lack of a fully integrated regionaltransportation system is one of the leadingchallenges for Toronto. It is also consistent
with rankings and observations made byregional business associations and recentprivate and public sector studies.
clear difference in Cities of Opportunity 5 and
even larger margin. Singapore’s top ranking,moreover, was the result of consistently high
in housing, third in public transport systems,and in the top 10 in three out of the otherfour variables (with its lowest score, in costof public transport, registering at just aboutthe median).
Seoul and Buenos Aires (tied for #3), andParis (#5). As a whole, the geographicaldistribution here is much wider than it wasin the last report. While Toronto was the only
Cities of Opportunity 5, this year, we have twoAsian cities, one from Europe, and one each
-cant, however, that sixth through ninth placesare all taken by European cities, while Dubai
Taking a closer look at these top 10, we noticeseveral crucial differences from our lastreport. The most obvious is the impressiverise of Buenos Aires, which now ties Seoul for#3. (In our last report, it tied Mexico City for#12.) There is, of course, a certain justice tothe “Paris of South America” just beating outthe French capital in this indicator. BuenosAires’s metro system celebrated its 100thanniversary in 2013, making it the oldestsubway system in Latin America, while (justto mention another facet of urban mobility)its 140-meter, 12-lane Avenida 9 de Julio—the widest avenue in the world—makes theChamps-Élysées look almost pedestrian andNew York’s Broadway a mere country path.Of course, Buenos Aires did as well as it didmostly because of very high scores in numberof taxis and cost of transport, but, still, thereis a certain underlying rationale for the city’ssuccess that goes back many decades to foun-dational infrastructure investment.
The other conspicuous divergence fromour last report concerns three of the most
urban transport—Tokyo, Hong Kong, andNew York. While they were all in the top 10 in
our last report, they are now, respectively, #11(down from fourth), #14 (previously tied for
For New York, the issues of cost of publictransport and availability of taxis—whichhave been consistently problematic for it in acomparative ranking—seem to have becomeeven more so with the addition of three morecities to our report. While it does better than
-selves in the bottom half of this indicator’s
of 30 cities, only marginally better than in ourlast report, in which it ranked 25th of 27.
Ï«¿´·¬§ ±º ´·º» ¤ 35
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36 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Urban conservation takes hold asskyscrapers rise across a powerful,new Shanghai
Wang Lin, director of the historic conservation department inShanghai’s Planning and Land Resources Administration Bureau and aLoeb Fellow at Harvard, has been one of the driving forces in the city’smaster planning and redevelopment for 15 years. Ron van Oers servedfor 10 years coordinating UNESCO’s World Heritage Cities Programmein Paris before assuming his current role as vice director of the World
based in Shanghai. Together, they combine insight into Shanghai’sevolution with a wide perspective on the world’s great cities.
…Wang Lin and Ron van Oers explain a young city’s coming of ageas they take afternoon tea on the historic Bund
To set the context, how would
Shanghai’s growth seems to defythe notion of keeping anything asit was.
RvO: Preservation is a word typi-cally used by Americans,but conservation in this regardwould be better, as it concernsmore a collective of processes to
-cance. Urban preservation,from my point of view, is acontradiction in terms because
is changing all the time—it’s
preservation is about strictlykeeping something as it is. Urban
conservation involves the process-
cance, which doesn’t mean thatyou have to freeze things. You
while you are actually adaptingto the current context. I thinkthat is what we are experiencingin Shanghai.
WL: I agree. When I got mydoctorate degree in preserva-tion of Chinese historic cities,we talked about the differencebetween preservation andconservation. Conservationincludes preservation, but it’smore than that. It means we canreuse a building or improve it,add new life or new facilities
Ï«¿´·¬§ ±º ´·º» ¤ 37
and revitalize it. That’s morethan preservation, especiallywhen you use it together with“urban,” because a city is a placefor people to live, so you need toadapt and make use of heritage.
Why should a city that’s growingas fast as Shanghai make conser-vation a priority? What are the
RvO: For big cities, and certainlyif you’re a really big city likeShanghai with nearly 24 millionpeople, I think a keyword is diver-sity—diversity of workplaces,residential areas, choices whereyou can spend your money. It’spartly for tourism purposes butpartly also for the residents whoare living and working in thecity, so they can actually have a
In my view, conservation is partof offering a diversity of choicesin work, leisure, and living.Shanghai practically has gotthe whole range of residentialstyles on offer and that makesShanghai stand out against manyother cities, like Hong Kong orShenzhen, which have just resi-dential towers. There is actuallyno choice.
People living and working inPudong, for instance, just takethe ferry to Puxi, Shanghai’sinner city on the opposite bankof the Huangpu river. I thinkfor them it is wonderful to beworking there in one of the glitzy
in a totally different neighbor-hood, where it’s almost like beingin a different country. Shanghaiemulates to a certain extent theEuropean experience, as you canactually travel around and havedifferent experiences within aday. And the practice of urbanconservation contributes to thatdiversity of experiences.
WL: I totally agree. What makesthis city so diverse comparedwith other cities is that in thecentral part of Shanghai, we have
areas. Each area has its owncharacter. When you go insideHengshan-Fuxing Historic Area,it’s a different character fromwhen you go into the BundHistoric Area and its waterfront,for instance. [The Bund is a river-side area of Shanghai popularwith residents and tourists for itsarchitectural mix.]
Who are the various stake-holders you consider in terms ofconservation, and how do youbalance interests among govern-ment planners, developers, andcommunities?
WL: At the very beginning, say20 years ago, not so many peoplepaid attention to historic preser-vation, so we just listed buildingsand got approval by the govern-ment. At the time, this was notso complicated. But now we havemore than 3,000 listed heritagebuildings, and this year, wehave begun to collect even morehistoric buildings to be listed. Nowwe have a very serious process,because the stakeholders, theplanners, the owners, or any ofthe people living in the city cangive their opinion if they wanta building or district to be listedor not. Of course, the HistoricConservation Committee makes
is part of the legal process now.
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Wang Lin
38 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Do you involve the people in thecommunity?
WL: Certainly. We show thepeople the plans for listing andrestoration or renovation; weput the plans on the web andin the newspaper and collecttheir opinion and ideas. If wholeneighborhoods are slated forrenovation or redevelopment, wehave a democratic process wherewe will ask the people to votewhether they want to move ornot. If more than 85 percentof the people who voted, or75 percent of the families,agree to move, then the wholecompound will be moved out andthe neighborhood renovated. Butthis process will be done in two
to inquire if they want to move.At the second stage, they will begiven very detailed informationabout where they will be moved,what the conditions will be like,the amount of space of the newhouse, or the compensationmoney they will be paid if theymove. And then they can vote ifthey want it or not.
RvO: What’s fascinating is thatShanghai is a relatively youngcity, barely 200 years old, butit is really at the forefront ofconservation thinking. Thatis a fascinating duality: youngcity, but very advanced inurban conservation practice.Other cities that have a legacyof 2,000 years have not beenable to articulate so wellwhat the importance of urbanconservation is for the furtherdevelopment of their city.
Looking forward, what are thechallenges you still want toaddress?
WL:thing is we need to be sustain-able, not just having the mostrapid speed of construction. Weneed to pay more attention tothe quality of the city. We needto keep a balance between theenvironment and the economy.Also equality is very important.We will pay more attention tolow-income persons. So we beganto look at quality, equality, andecology—we pay more attentionto that now.
Looking at the other cities wecover in Cities of Opportunitybeyond Shanghai, are thereany projects you view asreal successes or models forother cities?
RvO: I’ve been looking recentlyinto a series of Asian citiesbecause of the program that I’mtrying to implement in China—UNESCO’s Historic UrbanLandscape approach. Singapore,for example, is reinventing itselfcompletely, not only as a greencity but as a city in a park—youknow, not with parks in the citybut the city situated in a greenecological area.
going on in terms of applyinggreen technologies, creatingextra parks, but also linking allthe undeveloped, ecologicalareas surrounding Singapore anddrawing them into the city. A keyproject and connecting enter-prise in all this is urban farming.Singaporeans, the idea goes,should be able to buy Singapore-grown food, which should beorganic—it is very ambitious andat the core of sustainability.
Of course, Singapore has also
how it actually pushes forwardparticular policies, such asattracting a highly skilled andhighly trained workforce. They areinvesting heavily in science parksand biotechnology, but thosehighly skilled workers wouldlike to have also a high-culturalenvironment. So culture should bethrown into the mix as well.
The key with urban farming inSingapore is that all the policiesneed to be aligned to achievethis goal, and I think that is theimportant lesson from Lin inShanghai. Historic preservationneeds to be integrated into theplanning of the city, meaning thatvarious policies—how you dealwith housing, how you providefor a working environment, yourlabor policy—all those policiesneed to be linked to this goal ofhistoric preservation if you wantpreservation and development togo hand in hand and not hampereach other. Historic preservationis part of sustainability, and Ithink that making the city moresustainable means realigning allthe policies, including everythingyou do in terms of business andhow you invest your money inthe city.
Ô±±µ·²¹ ¼±©² º®±³ ̸®»» ±² Þ«²¼ ¿¬ ©¿¬»®º®±²¬ ®»¼»ª»´±°³»²¬ °´¿²²»¼ ¾§ É¿²¹ Ô·² ¿²¼ ±¬¸»®ò ß² «²¼»®¹®±«²¼ ¸·¹¸©¿§ ¿´´±© ͸¿²¹¸¿·²»» ¬± ½®± ¬¸» ®±¿¼ ¿²¼ ¬®±´´
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Ï«¿´·¬§ ±º ´·º» ¤ 39
WL: Shanghai looked at variouscities to see what we could learn,such as Boston, for instance.Boston has a major project —theBig Dig— the purpose of which isto put transport circulation under-ground and create more publicspace aboveground. Five yearsago, people in Shanghai couldnot go straight to the Bund. Theyneeded to go underground from aterminal and then walk up again,because there were 10 lanes of
did—and I was actually involvedin and in charge of one part ofthis project in 2007—is we put sixlanes underground and left fourlanes above the ground, and wecreated a 100-meter-wide spacefor the public. You can now enjoythe waterfront and the historicbuildings along the Bund on foot.
We’ve learned historic preserva-tion from projects in New York,such as the very popular HighLine. This project is not onlyabout historic preservation per sebut also how to make new publicspace and to make urban rede-velopment happen around it. Wealso learned from SoHo in NewYork, because when we renovatedthe waterfront at Suzhou Creek,where we have lots of abandonedwarehouses and factories, welooked at how these projectswere done in New York. We didpreserve a lot of warehouses andfactories, which were renovatedand used for creative industries—and the creative industry welearned from London, of course.
Lin, if you came back in 50 years,what would you be most proud ofand want to see?
WL: It’s my point of view thatShanghai does not need muchmore new construction. I think ß ¬®¿¼·¬·±²¿´ ´·´±²¹
when I come back in 50 years, it’simportant that the Bund will stillbe the Bund, that it will have keptits original image. But maybe
today. I would like to see morequality. It means that the level ofeconomic growth may be lower,and we should lower the speed ofdevelopment. But we would havemuch more leisure time in thecity. I hope, generally speaking,that the overall speed of life inShanghai will be slower.
Would manufacturing stillbe part of your vision forShanghai or would you only
other services?
WL: We need manufacturing, butit’s the same thing—the quality.We need to change the qualityof the manufacturing. We canhave a different kind of manu-facturing, but manufacturing is avery important part of Shanghai.We could change its style and addmore value to it. And we shouldhave more good quality publicspace, and more museums, moretheater, more culture and art—more cultural and life satisfactionin the city.
In 50 years, do you thinkShanghai will be the commercialand cultural center of Asia?
RvO:in saying yes.
WL: That’s our ambition. We seta goal to be like that. I think in50 years, we will be.
Learn more
A full-length print version of theentire discussion is available atwww.pwc.com/cities.
40 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
Health, safety, and security
While this indicator has apparently changed-
but to a degree, at least in the case of afew cities.
The obvious change is that our formerhospitals variable has been renamed, and
-ment. Previously, this variable denoted theratio of all hospitals within a city accessibleto international visitors for every 100,000members of the total population. Now we’ve
with the ratio of health-sector employmentper 100,000 of the population. As a result,the actual number of people working inhealthcare gives us a substantial statistical
system as a whole and, moreover, takes awayany possible advantages that cities with manysmaller hospitals might have over those withfewer but much larger institutions.
The other, and even more substantive, changehas been to the crime variable. Until thisreport, crime was based on only one datapoint. We have now added, in a weightedcalculation, two more: 1) a survey of resi-dents’ own feelings of security regarding theirrespective cities and 2) homicide rates. Thislatter item of information is obviously critical.At the end of the day, a human being’s sense ofphysical safety is the most primal perceptionof security that he or she has. Supplementingour overall crime variable with this gauge ofsuccess—or failure—also adds the most real-istic, as well as the most intuitive, assessmentof a city’s public safety.
Interestingly, our changes have not funda-
with a marginal difference, in the currentone. Sydney and Toronto tie for second
again marginally above Sydney in third place,in our previous report. All in all, nine of thecities in the top 10 in the last report remain inthe top 10 in this one. The only difference isthat Paris joins them this year, having gained
hospitals and health employment variable(while Milan drops slightly to #12). Onceagain, this indicator proves that health, safety,and security are the benign legacy of socialdevelopment and economic advancement.
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Sustainability and the natural environment
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it is to design this indicator in a way that
environmental challenges facing our cities.We wrote then that the variables here havechanged over the years simply because the
public policy—especially as cities vary widelyin terms of climate, geology, demographics,and economic development.” Nonetheless,
method and the quantitative measures bywhich we assess our variables, we are gettingever closer to the bases of urban sustainabilityand to an objective description of those citiesthat are in the forefront of sustainable poli-cies and practice.
In this report, the variables have remainedthe same, but we’ve further honed two ofthem and, even more important, recalibratedanother in order to make the indicator as a
practice and environmental quality of life.
recycled waste as. Previously, a city such as Stockholm
was penalized for “low” percentages ofrecycled waste although, in reality, the city’s
Waste-to-Energy (WtE) programs are sosuccessful that it now “imports” waste forits WtE plants from municipalities
.7
We have also further enhanced our thermalcomfort and pollution variables. For theformer, we now factor in high tempera-tures and evening humidity over fourmonths rather than average temperatureand morning humidity over two months,as we did previously (and we’ve replacedour data source, which is now the WorldMeteorological Organization). For air pollu-tion, we’ve supplemented the most recentdata from the World Health Organization inorder to update it.
The results, in the end, while not radically
cities. The clearest improvement this year is
now ties Sydney at #1; moreover, it outscores-
pollution), and only falls into the bottom10 (as opposed to Sydney’s fourth place) inthe one variable in which icy Stockholm isplainly blameless for its result. Geographymight not be destiny, but thermal comfortis the one factor that any (very) northerncity—including, obviously, Moscow orToronto—can do very little about—otherthan know how to cope with and improve it,which Stockholm certainly does.
Berlin and Paris also do very well this year,tying for third place. Germany’s capital risesfrom fourth in our last report, while Paris
Cities of Opportunity 5. The most impressiveadvance by far, however, is that of Chicago,which was #13 in our last report and now tiesLos Angeles and Moscow for seventh place(which is also a considerable improvement forthe southern California city).
A number of cities do less well this year.San Francisco and Toronto, which weretied for second in our last report, are now,
Milan, meanwhile, have dropped out of thetop 10, with the US city dipping from #9 to#11, while the Italian one has declined even
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The Prado’s relationshipwith Madrid
according to Miguel Zugaza
Since 2002, Prado director Miguel Zugaza has overseen the reinvigora-tion of one of the world’s greatest museums with collections spanningVelázquez, Goya, El Greco, Bosch, Bruegel and Dürer. Attendance hasrisen by nearly a million annually during Zugaza’s tenure—despite theeconomic crisis— including many more visitors from the Madrid area.Here, Zugaza discusses a museum’s responsibility to the public and itsmulti-faceted contribution to the city. He also tells how, in the face ofdrastic funding cutbacks, the Prado is continuing research and conser-vation and still expanding services and public access.
You have said that the Pradohas grown without forgetting itsreason for being. What would
for being?
Museums were invented towardthe end of the 18th century withthe ideas of the Enlightenmentand haven’t changed that muchup until our days. What haschanged is society and the waysociety uses museums. I think it’simportant that museums adapt tothe needs that society makes ofthem but without changing theiroriginal mission. However, somemuseums fall into the temptation
of following the demands ofsociety and become somethingthey’re not. In a way, museumsare a natural reserve of humanity.We have to temper the experienceeven if it’s understood as almostan antiquated ideal. But, it’s aunique experience with art.
What are your goals for thepeople who visit the museum?
First and foremost, a museum’smajor mission is to take care ofits collection. What the visitorultimately looks for is the authen-ticity of the collection as it is
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presented: works of art that are-
sibility. Furthermore, we have toput this collection at the disposalof a very heterogeneous public.We have to think of a public thatperhaps is highly educated andspecialized and present the worksin a way that appeals to them,in the same way that we have tothink about the visitor who hasmuch less information, is muchless versed in the collectionwhether he or she comes from asmall village close to Madrid orfrom Seoul. I think that’s whatwe have to do.
What is the Prado’s relationshipwith Madrid?
One of the problems we detectedearly on was that the Prado hadlargely ignored the city. It wasa museum for the tourists. Andwhat we worked on diligentlyfrom the beginning was toactually nourish a relationshipwith the visitor who is closestto us, from Madrid itself. Oneof the great recent successes isprecisely the addition of almost
a million new visitors annuallyfrom our own community. Wehave structured our programof exhibitions as a key to thatrelationship with visitors in closeproximity, at the same time aswe pursue research.
Do you think that the politicalchanges in Spain in the past30 years have helped thePrado to become more vibrantand popular?
There are two moments that arevery important in the transi-tion for the Prado and Spanishculture. And they both have todo with the relationship between
was the arrival of the
from the Museum of ModernArt, it came to the Prado. Andthen, the second was an exhibi-tion of Velázquez that the Pradoorganized in collaboration withthe Metropolitan in ’89 and ’90. It
because of the amount of success.It was a social gesture of greatrelevance. It was Spanish society
acknowledging, recognizing the
Because of Velázquez, because ofthe Prado, because of the momentin time?
It’s a mixture of the threeelements. A lot of people at thetime of Spanish society thoughtof the Prado as a museum of theFranco era. The Velázquez exhibi-tion gave society a recognitionthat changed the relationshipwith the Prado. That’s themoment when Spain began todiscuss the need for the Prado toexpand because of the relation-ship to the needs of this newsociety.
What contribution does a greatmuseum like the Prado maketo a city?
No doubt the Prado has a veryimportant cultural impact inMadrid but also a socioeconomicone. Every 1,000 visitors whocome to the Prado generate onejob in Madrid, symbolizing theeconomic fabric that surrounds
the Prado. There’s also anelement of pride in the city ofMadrid toward the Prado. It’salmost a patriotic feeling the cityof Madrid and the country itselfhave toward the Prado.
You have said we must encouragethe public to have a conscientious,more mature relationship with themuseum. Describe that relation-ship and how you accomplish it.
I’m always impressed that anyperson who appears at the doorof the Prado, right before cominginto the museum, has made avery important, a very relevantdecision—which is to come intoa museum and have a personalexperience with works of art.
When we began here, people usedto criticize the groups that camefrom the far corners of the worldand the way they experiencedmuseums. But I reminded them
-sands of kilometers, taken a partof the little vacation they haveevery year to come to the Prado.
46 ¤ Ý·¬·» ±º Ñ°°±®¬«²·¬§ ê ¤ ЩÝ
I remember telling people ofMadrid and Spaniards in general,“You criticize these tourists, butyou have the museum right nextto you across the street. Youunderstand its prestige as aninstitution, but you don’t comein to see what’s inside. You’renot valuing it in the same way.”And the museum can offer manythings. And that’s why I think weshould attempt to bring the Pradoto the public, at different levels.If it is a public museum and wewould like to invigorate thatrelationship with the public, oneshouldn’t have to pay to come in.That’s why we looked for a mixedformat so a lot of groups canactually enter free.
How have you adapted to theeconomic crisis?
In the past three years, the Pradohas lost 60 percent of the fundsthat were allocated from theadministration. At this point,what the Spanish administrationgives to the Prado allows us topay half of the staff’s salaries. Butour reaction was to actually invig-orate our activities, do more thatwould appeal to more visitors,
and in that way, generate greaterrevenue. We’ve readjusted theprogram of the museum withthe idea of being fully able towork within the $42 millionyear-round budget by 2016. Wewill generate what we have lostfrom the Spanish administrationby our own means—by having astronger relationship with societyand asking the visitor to pay aslightly greater share. We’re avery simple enterprise.
what do you say to the publicsector, to private philanthropiststo convince them the Prado isa priority?
I actually think that one of theways we will exit the crisis inour country will come from thecultural sector. Spain has a veryimportant asset in its culturalheritage. And we know how tomanage this Spanish heritagevery well. It generates excel-lent employment. It generatesappealing activities for touristswho can enjoy it. It enriches theeconomic fabric around us. Andit’s important that politiciansand society know this and valueit as well.
The crisis undresses a country.The crisis leaves you naked. Whenyou take away all the accessories,all the jewels, what it will leaveSpain with is the nucleus for thefuture, the strength of what ithas. And no doubt, one of thegreat things this country has is itscultural heritage. I think that oncewe come out of this crisis, thateverything that has to do withculture in Spain could generatealmost 6 percent of GDP ratherthan the 4 percent it does now.That should be the objective.
If you knew in 2004 the economiccrisis was coming, would youhave said to architect RafaelMoneo, “No, let’s not build thenew wing?”
No, I wouldn’t. The Prado neededthis extension to better presentits collections to appeal to theneeds of the visitors. As a matterof fact, the Prado’s extension hasnot been a capricious expansionin any way. It was very muchneeded. What we could havedone, had we known, is perhapsstop building unnecessary proj-ects such as airports in Spain thathave no airplanes or museumsthat have no contents.
The idea of investing time andlabor to perfect craft into artseems not modern.
That’s almost like an occasionaldefect of the way artists aretrained nowadays. Baudelaireused to say of Manet that he wasa genius amongst the decrepitudeof painting. He spoke of Manet asif saying he was the last one. Andthe craftsmanship of paintingand drawing is dying. It’s dyingevery day as we speak. And it’sinteresting that at the same timethat we’re seeing the death of thiscraftsmanship, it’s when societyis demonstrating its greatest needto see great art.
What does quality of life mean toyou in a city?
For me, quality of life has a lot to-
ment of the public services,where you have good alterna-tives for education, for health,good opportunities to relate withart and culture, within a secureenvironment. On top of that, it’san ideal city if you have a goodclimate, and the society is funand not lazy, and people wantto reinvent themselves and be
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dynamic. Small Spanish citieshave actually developed ratherwell this idea of quality of life.
It has been said “you are like agreat orchestra director whoknows how to talk with everyone,the politicians, the administra-tors, the curators, the educators.Miguel Zugaza gets the best out ofall of them, and he gets what hewants, too.” What is the secret?
I think a director has to be agood connector. He connects agood sponsor with a good projectthat a curator is developing, forexample; or the museum itselfwith different sensibilities, forinstance, amongst politicians.I feel comfortable doing this.But then somebody once told mehaving the product I have makesit all that much easier.
It’s a beautiful museum.It’s very intimate.
There is this human scale toit, yes. That’s one of the most
Learn more
A full-length print version of theentire discussion is available atwww.pwc.com/cities.
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Demographics and livabilityTwo new variables rejigger the order within the top 10
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variables taken directly from the PwC surveyof 15,000 of its global staff (an average of20 percent of personnel in each city ofopportunity) that supplements this year’s
previous report has now been supplementedby ease of commute; in addition, we’ve addeda sixth variable, relocation attractiveness,
question, “Of the other 29 cities in Citiesof Opportunity, which are the top three inwhich you’d most like to work?” Finally, we’vefurther normalized the measure of working-age population in order to even out somediscrepancies in the relevant statistics (see“Key to the variables,” starting on page 66,for further details).
The results are both substantively differentand consistent with the past. In other words,while the cities in the top 10 are almost all thesame—the only difference being New York’saddition to the group (tying for #10)—the
drops to seventh. London is now #2, justbehind Sydney, while San Francisco justbeats out Berlin for third place. In the end,Germany’s capital climbs three places, Torontodrops four, and Singapore, Stockholm, andChicago stay where they were (although theWindy City now ties with New York).
The fact is that fundamental resultsthis indicator (whether in the
upper, middle, or lower ranks) remain almostprecisely the same. Given the nature of theindicator, however—and most of its variables(cultural vibrancy, quality of living, ease ofcommute, perceptions of attractiveness)—itwould have been odd if the top cities changedradically from one report to the next. Thisindicator is about “livability” after all, and aswe stated in our last report, there seems tobe a global consensus, if not on what makesa “livable” city, at least on which particularcities are more livable than others.
The distinctive results in the current reportare those that quantify global attractive-
certainly aided those two cities’ rise in the
contributed to its overall drop). Of course,PwC’s survey polled a staff with character-
Nonetheless, PwC is a prominent global
hundreds of cities in almost 160 countries.
highly skilled, globally mobile services sectorwhose personal investment of themselvesand their family is so critical to the ongoingprogress of urban communities worldwide.Consequently, when these individuals saythey’d prefer to live in some cities as opposedto others, both the selected cities and thosenot chosen need to listen carefully as to whythat is.
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From Mumbai to Manhattanto the favelas of Brazil…Suketu Mehta writes the story of modern cities
Born in Calcutta and raised in Bombay (now Mumbai), Suketu Mehtalives in Manhattan and teaches at New York University. He has alsolived in London and Paris. His prize-winning book,
, was hailed by Salman Rushdie as “the bestbook yet written about that great, ruined metropolis.” Mehta, nowworking on a book about New York, once wrote: “I live in cities bychoice, and I’m pretty sure I will die in a city.” Here, he discusses whyhumans are so powerfully drawn to cities and what makes a citygreat. As the technological revolution continues, how is it affectingthe economy and employment?
In , you write,“Bombay is the future of urbancivilization on the planet, Godhelp us.” How does it representthe future, and why should thatscare us?
The planet is divided broadlyinto two groups of cities. Onegroup consists of the establishedcities of richer countries—places like New York, Paris, andLondon. The other consists ofthese teeming megacities of thedeveloping countries—places likeBombay, Lagos, and São Paulo—whose growth is primarily dueto migrants coming from the
impoverished countryside. Bysome estimates, Bombay addsa million people every year. Butit has no coherent, practical, orachievable plan for managingeven the number of people it hasalready. Still, people continue to
spite of extremely adverse livingconditions. In Bombay, about 60percent of the population lives ina slum. They give up the clean airand open spaces of the coun-tryside to live in shacks withoutrunning water or toilets and toendure tremendous insecurity.I set to wondering: Why wouldthey do that?
Ï«¿´·¬§ ±º ´·º» ¤ 51
Are they driven primarily by
Moving to a city can dramati-cally improve your economicsituation in the long run. Butmigrants are also drawn by themetropolitan allure of the city. Ayoung person in an Indian villagemoves to Bombay not just tomake more money but because
a place where your caste doesn’tmatter as much. And for manymigrants, Bombay is where theirdream lives occur. The majority
Bombay. So when a migrantwalks on the promenade inBombay, he’s already been therein his dream life, because he’sseen the actor Shahrukh Khandance on that same promenadein the movies.
You depict Mumbai’s slumsnot just as places of “perpetualmisery,” as we might expect.What don’t we understand aboutslum life?
We tend to think of a slum as anexcrescence. But in a Bombayslum, there’s a vast range ofhabitations. Many are awful,but some are pretty well-builtand have the latest appliancesand satellite dishes. It’s nearlyimpossible to obtain rentalhousing in Bombay at a reason-able price, so most migrants gointo slums. There’s a huge rangeof people living in these informalstructures: You have the abso-lutely destitute but also doctors,lawyers, computer scientists.
And these are places of incred-ible entrepreneurial energy.Slums all around the world arean anarchist’s dream, because thestate doesn’t provide them withmany services. Everything fromtransport to sanitation to waterto cable television is provided bypeople in the slum, often very
the local electrician illegally tapsthe municipal electrical line andsnakes it through the rooftopsto your shack. Bombay’s slumsalso have very strong communitynetworks, which is why theydon’t erupt—and why most ofus would be extremely safewalking there.
How are the slums, or ,different in Brazilian cities likeRio and São Paulo?
The difference is that theirslums have indoor toilets andrunning water. Physically, they’remuch better. But they also havedrugs and guns, which we don’tyet have in large numbers in
Bombay’s slums. Some Brazilianare among the most
violent places on Earth. One bigquestion for city governmentsin places like this is: How muchof the state do you introduce?The biggest battle is in security,because many people in slumsdistrust the state.
How can a megacity like Mumbaideal with overcrowding?
If you look at it from the air, yousee that there’s no reason for thisovercrowding. The problem isthe uneven distribution of peopleand the lack of a functioningtransport system. Every morning,millions wake up in the north andcommute to the south on some ofthe planet’s most crowded trainsand buses. It’s an incredibly inef-
numbers of people. There areall kinds of innovative solutionsavailable, like the bus rapid transitsystem, which provides dedi-cated bus lanes. But in cities likeBombay, it’s not enough to think
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of the ideal urban plan. It’s aboutwhat’s politically feasible, giventhat it’s a democracy with verywell-mobilized interest groups.Also, the city is ruled by the stategovernment. Bombay needs to beallowed to control its own destiny.
How has New York City changedsince you moved there in 1977?
When I arrived, it was a mess.It had narrowly escaped bank-ruptcy. Mobs were looting storesand homes. I was mugged twice.There was garbage everywhere.The subways were awful. Now,it’s never been a more attractiveplace to live. It’s America’s safestlarge city. It’s clean. The subwaysrun well. It’s this glamorous place,
the world. Two out of three peoplein New York are immigrants ortheir children. And the miraculousthing is that there’s almost no
of New York is that nobody isexcluded. It’s not that you’ll getinvited to every party. But, some-where in the city, there’s a party towhich you are invited. The city isworking in most ways, except one:It’s dramatically unequal. The top1 percent make more money in aday than the bottom 44 percentmake in a year.
You’ve written that Paris isbeautiful partly because thepoor—particularly immigrants—are shunted into the outskirts.How problematic is this lackof inclusiveness?
Paris is a museum city. The build-ings have a pleasing uniformity.Very little new development ispossible. By contrast, the beautyof New York is in its chaos:There’s this eruption of buildingshere. And the beauty of Bombayis in the chaotic energy of itsstreets and its hospitality—the
fact that people can come fromall over the country and livethere. You can’t do that in Paris.It’s very tightly controlled. Pariscontinues to have problemswith tolerating difference. Itsimmigrants largely live beyondthe municipal limits; theyperiodically come into the cityand burn cars or riot. Unless
feel included—or, at least, notexcluded from the celebration ofthe city—this is going to happenwith increasing frequency.
Do you see diversity as an assetfor cities?
Yes. Cities all over the worldare trying to attract a newcreative class, a rich global eliteworking in areas like technology,biomedicine, and banking. Thisis a fantastically mobile classthat grew up learning differentlanguages, and they regard diver-sity as an essential component ofa great city. Cities have to realizethat these people really want achoice of diverse cuisines andentertainment. They don’t mindseeing lots of different faces fromdifferent cultures on the subway.They don’t want to live in abeautiful, monocultural place.So there’s actually an economicvalue in difference.
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Is London’s strength its opennessto difference?
London is very open culturally.But it’s increasingly less openeconomically. The questionis: How long, if you’re poor ormiddle class, can you affordto live close to the center ofLondon? It doesn’t matter howwelcoming the city is if you can’t
reasonable price, because youwon’t be part of the city at all.That’s dangerous to the city’swell-being. You need the greatmiddle class—good people whowill keep faith in the city during adownturn. In the next downturn,the foreign billionaires will justgo to the next hot spot—Dubai,Shanghai, or Mumbai. So youneed people with roots, withlocal engagement, with family.
in major cities?
The emergence of cities withoutchildren is a disturbing trend. Inricher cities all over the world,
of singletons, of people choosingnot to get married or havechildren. And in places like SanFrancisco, Seattle, and Berlin,families are deserting the city. Ascities become more expensive andapartments smaller, the suburbsstart looking better. That’s terriblebecause a city without childrenis like a forest without songbirds.That’s also why good publiceducation is so crucial in cities.This is something cities will have
retain people with kids?
What’s your favorite city?
I really can’t say I have afavorite. I grew up in Bombayand New York. I’ve lived in Parisand London and, for stretchesof time, São Paulo. Each has
I think New York is the best cityin the world to walk in. The mostbeautiful cities I’ve seen are Rio,Istanbul, and Hong Kong; themost culturally vibrant is SãoPaulo; the most dynamic andentrepreneurial is Bombay.
One quality you prize in NewYork and Mumbai is their chaoticdynamism. Why?
To me, a messy heterogeneity is
That’s what keeps cities fromgoing sterile. It’s a city whereyou can’t quite predict what’sgoing to happen. It shouldn’tbe a completely unmanage-able place where a maraudingmilitia can come in and loot andrape. But it should be somewhatunmanageable.
Are humans ultimately urbancreatures despite our complaints
Cities are the purest expres-sion of who we are. They’re ourgreat mark on the planet. We’vedespoiled the planet, so it’s forbetter and for worse. But it’swho we are, if you look at what’squintessentially human, whatwe’ve done, how we’ve chosento live. All over the world, there’sa stampede to cities. Becausethere’s something about cities,no matter how awful they are,which speaks to something in usas human beings—this need tolive in clusters, this metropolitanexcitement, this sense that youwon’t starve as you might in thecountryside. Whether they’reworking cities like New York ordysfunctional cities like Kinshasa,people are stampeding in to livein these overcrowded places. Thisis where the action is.
Learn more
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Economics
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Paying the way for progress:Clout, cost and ease of business
The last section of this year’s report focuses onthe indicators that assess and describe threeseparate dimensions of urban economies and,in so doing, demonstrate the several ways inwhich cities can implement effective strategiesfor economic growth. The indicators here alsopoint to the synergies required if this growthis going to lead ultimately to permanenteconomic potency and, above all, depth.
It is precisely this sense of depth that ismeasured
economic history of the urban world. That iswhy it is hardly accidental that the top-rankedcity in this indicator is London and that itis followed by Beijing, New York, Paris, andShanghai. These are all legendary cities, threeof them seats of former empires, with tremen-
cultural sway. The empires might have all nowdisappeared, but the cities once at their coreremain global centers of economic might.
What is most notable about our second indi-
more interesting is that the three cities in thetop 10 in this indicator and in economic cloutare also in the top 10 in our third indicator,ease of doing business—the only three citiesscoring this economic trifecta. A number ofconclusions can be drawn therefrom.
and Toronto—the cities that make up thesuccessful triad—know from experience that“clout” is not a product of brute force but
of perpetual management, development,and, especially, resourcefulness. Second,the cities in the top 10 in cost also explodethe myth of the inability of mature cities to
from North America and one (Berlin) is evenfrom Europe. And of the four cities from theemerging economies, two of them, Seouland Dubai, are generally recognized asbeing on the verge of passing over into thecategory of fully “emerged” (if they haven’tdone so already).
between economic clout and ease of doingbusiness. This, of course, seems obvious andeven intuitive: A place in which it is easy todo business will actually do business and,therefore, develop economic muscle. Our
cities in the top 10 in economic clout arealso in the top 10 in ease of doing business.The four cities that fall out of the top 10 inmoving from economic clout to ease of doingbusiness are Beijing, Paris, Shanghai, andTokyo; even more interestingly, all four citiesfall into the bottom 10 in cost.
What is certain in and about today’s globalenvironment is that being competitive incost and ease of business might very welllead to economic clout. Once achieved,however, there’s no guarantee that economicclout can be maintained. On that score, ErikBrynjolfsson, director of the MIT Center forDigital Business, talks with us about the riseof robots and the race to keep our jobs in thesecond machine age (see pages 58–61).
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Economic cloutLondon ascends to the summit,
The changes in this indicator this year areminimal but, again, as with other indica-tors, they’ve been made in order to sharpenthe accuracy of the ensuing results. We’vecollapsed our two previous foreign directinvestment (FDI) variables (measuringnumber of new job-creating projects and totalcapital investment), which were essentiallyredundant categories, into one variable,which now aggregates total investment.
growth in order to reduce year-to-year vola-tility. We now average it out over three yearsrather than giving a single year’s rate.
Still, this indicator arguably remains the oneout of our 10 with the heaviest burden tobear—or, more accurately, the most chal-lenging name to live up to. In theof today’s world, after all, what greater gaugeof sheer muscle is there—short of a militaryarsenal—than economic power? And sincecities don’t have to worry about raisingstanding armies or building aircraft carriers,their economic resiliency and performance
says even more about their futureviability than it does about their past success.
The key term here is “historically.” Itexplains not only the consistency of thetop performers but also the occasional“surprises”—which, once they’re examineda bit more carefully, turn out to be anythingbut. In a previous report, summarizing thisindicator, we wrote that “economic strengthdoesn’t come easily; it has to be earned overtime.” In a subsequent one, we reiterated that“economic clout has a great deal to do withstaying power.” The top 10 cities here—andcertainly those in the top half of the rank-ings—have been around for a while. The
“newest” among them (invariably in the NewWorld) were founded, in most cases, in the18th century. Only Chicago is less than twocenturies old.
Even among emerging economies, Beijingand Shanghai maintain their extraordinaryeconomic and cultural duopoly in the faceof extremely dynamic competitors such asShenzhen, whose economic developmentgoes back only to 1979; in Brazil, São Pauloand Rio de Janeiro (founded in 1554 and1565, respectively) remain Brazil’s urbanpowerhouses, as opposed to the capitalBrasília (founded in 1960). And Brasília’sexperience is not unique. The most successfulcapitals in the world (London, Paris, Beijing,Moscow) have organically led (or, at least,been part of) the historic growth of theircountries, as opposed to places such asWashington, DC, Ottawa, or Canberra thatwere designated as capitals—that is, -
centers—while the economic workwas done in other, much more vigorous andforceful cities integrated into a national or theglobal economy.
It is precisely this reality of a vital city, one
world, that most thoroughly describes the topranks in this indicator. As we wrote in our lastreport, a city’s “clout” is measured, above all,by its “ability to translate urban strength intoa global economic presence.” The cities thatdo best in this indicator might be nationalcapitals or they might not be. None of them,however, is a mere administrative center.They are all global hubs of commerce, invest-ment, and production (a city itself might not
can contain international headquarters of
corporations that manage enormous manu-facturing capacity worldwide). In the end, thecities that do best here are so familiar becausethey’ve been doing what they’ve been doing,creating wealth for their citizens and theworld, for a very long time.
London certainly has been doing that forhundreds of years, so its #1 ranking here isas expected as anything can be in the globaleconomy. And yet, due credit must be givento the British capital, not only for overtaking
Paris in doing so) since our last report butfor accomplishing that feat during a timeof unusually painful economic conditions.Paris’s drop from #2—a rank it held overseveral reports—to #4 this year is proof of
has been for most cities in the developedworld, but it also demonstrates the city’s resil-iency and long-lived strength.
In any case, although they’ve mostly changedplaces, the cities that were ranked in the top
in this one—further proof that economic
of many years of planning and building andof refusing to take past success for granted.Indeed, as a whole, the cities in the top 10haven’t changed very much—except for onevery impressive leap up the rankings. In our
of 27 cities and tied with Madrid. Currently,it ranks #7 out of 30 cities—helped by ouradjustment of the FDI variable—while theSpanish capital is now tied for #17. SanFrancisco thus joins Paris and Toronto asanother example of a smaller city with
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Robots are coming to a city nearyou…and they want your job!…Erik Brynjolfsson of MIT explains how to stay a step ahead oftechnological unemployment
Erik Brynjolfsson is a professor at the MIT Sloan School ofManagement and the director of the MIT Center for Digital Business.In 2003, declared: “If e-business had an oracle, ErikBrynjolfsson would be the anointed.” Since then, he has sealed hisreputation as one of the world’s leading experts on the economiceffects of technological innovation. He is the co-author with AndrewMcAfee of a new book,
. Here, he shareshis vision of the future and discusses how cities can ride this waveof technological change.
As the technological revolutioncontinues, how is it affecting theeconomy and employment?
There’s a great paradox rightnow. The US has hit a new recordfor net wealth. There are moremillionaires than ever before.Productivity and GDP are atall-time highs. But the medianincome is lower than in 1997;the portion of the populationthat’s working is falling; jobs aredisappearing. So the economy isworking well in making the piebigger, but a lot of people aren’tsharing in that. And there’s noeconomic law that says everyone
progress. With every technology,some people are made worseoff. Recently, it’s gotten to be abigger and bigger section of thepopulation, because the newtechnologies are so powerful andaffect so many more tasks thanearlier technologies. We’re at a
You’re seeing cars that can drivethemselves; you can talk to yourphone and have it carry out yourinstructions; there are problem-solving machines that can nowmake medical diagnoses. Ineach case, technology is pushing
Û½±²±³·½ ¤ 59
back the frontiers of things that,previously, only humans coulddo. As a result, we’ve seen a greatdecoupling of productivity frommedian income and employment.That’s a real change. We’re in adifferent era now.
Despite this economic dislocation,you describe yourself as a digitaloptimist. Why?
Technology is having anenormous effect on our abilityto produce wealth, but it’s alsoa substitute for many kindsof labor. That’s part of the
concern—that people won’thave jobs if machines can do
-ciently. But in the long run, I’moptimistic, because there’s noinevitability to any particulartechnology trajectory. I don’tthink we should try to slowdown technology. However, I dothink we should speed up therate of re-skilling people andimproving the way they workwith machines. That way, wecan create not just a bigger pie,which is almost inevitable withthe improvements in technology,but also shared prosperity,with more people participatingin it. The key, though, is thatit’s going to happen only if wemake conscious efforts to guideour society in those directions.We need to make choices thatimprove those outcomes.
Such as?
We can do a much better job witheducation. We’re just beginningto use digital technologies likemassive, online, open course-ware. Technologies like these
can allow us to bring the besteducational methods and thebest teachers to a much broaderset of people. These technologieswill also allow us to understandwhat’s working, since digitalprocesses are inherently moremeasurable. So education is onecategory where we can improve.There are also other areas likeboosting entrepreneurship—not because everyone is goingto become an entrepreneur butbecause entrepreneurs are theones who create jobs.
In , youargue that everyone from lawyersto truck drivers will be upendedby technological change. Whatshould individuals—and cities—do to prosper in this new era?
A lot of routine information-processing work is beingautomated. This is increasinglyhappening with routine physicalwork as well. But a number ofareas will be in more demand.One is creative work. The secondis interpersonal interactions.And those are areas where
cities can excel. They can stokecreativity by bringing peopletogether. You need to attract acreative class of professionalswho work together. They’reattracted partly by the culture,partly by proximity to othercreative people. These peoplewill be even more in demandin the next 10 years, and thesuccessful cities will be the onesthat cultivate and attract them.
How important is immigrationas a means of driving innovationand creativity?
The data I’ve seen suggest thata disproportionate share of thestartups in Silicon Valley werefounded by people born outsidethe US. One of the country’sgreat strengths is the ability toattract creative people from allover the world to help not just
-throughs and contributions to
wonderful for America to bringthese people together.
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It’s also good for the world,because many of those people aremore productive in this milieuwhere they’re near each other.Urban environments tend tofacilitate that because creativeworkers can be close to othercreative workers, and the speedof idea transmission is muchgreater that way. Wonderful asemail and other digital technolo-gies are for sharing ideas, thereare still a lot of things that canbe done much better face to face.So, by bringing people togetherfrom all over the world who haveideas in particular areas, youcan speed up idea creation.
So the density of cities reallyfuels innovation?
Absolutely. The reason I lovebeing at MIT is because of allthe amazing people I bump intohere. When I work at home, I
certain kinds of tasks, but I
bumping into people. The samething is true for cities: By gettingpeople to be near each other,you get what economists call
“externalities” from these idea-sharing events. That’s one of thegreat virtues of a university andof a city. Unfortunately, it’snot something technology caneasily replace—at least, notin our generation.
Do you see similar trends oftechnological change anddisruption outside the US?
Yes. The same forces apply inChina, India, Europe, LatinAmerica. I’d say that workersin low-wage countries are evenmore in the bull’s-eye of automa-tion than those in America. Ifyou look at manufacturing, forinstance, much of the routinework has left the US for lower-wage locations, but that’s exactlythe kind of work that robotscan do best. So, if countries likeChina or Vietnam are relyingmainly on low wages to protectthemselves from automation,that’s going to be a losing battle.In fact, we’ll see robots takingmore and more of those simpleroutine tasks away from humansin every country.
What happens if cities stick withtheir old ways, hoping thesetechnological and economicchanges will pass, instead ofadapting to this new era?
There are certainly sometemporary phenomena goingon—like the Great Recessionand the business cycle. But theroots of this disruption we’reseeing in the labor markets andelsewhere are much deeper andhave to do with fundamentaltechnology changes that areonly going to accelerate. Thosetechnological improvements—whether it’s self-driving carsor being able to speak to ourmachines—are just the tip of aneven bigger tidal wave of changesthat we’ll see in the next 10 years.Technological change is going toaccelerate. But our organizationsand institutions aren’t keepingup. And if they don’t keep up,more people will be out of work,more people will fall into poverty,and we’ll have even more socialand economic disruption. Soignoring those technologychanges isn’t an option. The best
option is to speed up our adapta-tion to the technology, and that’sgoing to require much moreeffort in thinking about urbanplanning, organizational studies,and economics, both at thenational and individual levels. Allthose things are going to requiremuch more attention than we’vegiven them so far.
Boston, which is just across theriver from you at MIT, is a rich,developed city. But is thereanything about it that you’dwant to improve?
The physical infrastructurecould use a lot of improving. Inpart, it’s a matter of investing intransportation. New technolo-gies and congestion pricing could
smoothly. There are also thingswe can do in terms of educationthat would continue to makeBoston a magnet for creativeand intellectual leaders. Thedata I’ve seen suggest that if weinvested more in education atthe K-12 level, that would havehuge payoffs. And it would bea wise societal choice to boostthe pay of teachers so we startattracting more of the best andbrightest into that area. When weunderinvest in education, bothin terms of technology and directresources, we are shortchangingour future.
Learn more
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Although both intellectual capital and ease ofdoing business lost one variable each in thisreport, they both still contain the most of anyother indicator, in this case eight. This indi-
we’ve now deleted because the ability to staythree months in a city is, practically speaking,much less important than actual access to itin order to do business. The concrete effectsof this minor change are minimal in the end,however, notwithstanding a couple of excep-
What is immediately striking about theseresults is the sheer consistency of the citiesat the summit of the rankings over the lastseveral years. Simply put, there was no changeat all in the top three. Top-ranked Singapore,second-ranked Hong Kong, and third-ranked
Citiesof Opportunity 5in the top three in Cities of Opportunity 4,with the only variation being that Hong Kongand Singapore were #1 and #2, respectively.Indeed, eight of the top 10 cities in this indi-cator this year have been in the top 10 in ourlast three reports, while Stockholm has joinedthe group in the last two.
This is remarkable consistency. And whatis even more remarkable is the consistency
and its considerable margin of difference with#2 Hong Kong. It ranks at the very top in
falls out of the top 10 in one variable—andhardly a critical one (foreign embassies orconsulates). This is a dominating perfor-mance. And it shows a city that, despite all itsprevious success in the global marketplace, isanything but complacent.
But, then again, hardly any of the cities inthe top 10 can be accused of resting on theirlaurels. As already mentioned, most havebeen here for the last few years and clearlyintend to stay here. Nonetheless, two Asiancities, Tokyo and Kuala Lumpur, that were inthe top 10 in our last report have fallen out ofit in this one.
There are three other, broadly geographical,issues that seem to indicate a possible long-
US cities, which do extremely well over mostvariables in this indicator with the exceptionof ease of entry, as federal visa regulationsput them at a distinct disadvantage to theirglobal competitors.
A second seemingly enduring issue isEuropean. In this report, just as in our last one,Stockholm is the only continental Europeancity in the top 10. Paris and Berlin bring upthe bottom of the upper half in this indicator,while Madrid and Milan fall into the lowerhalf. What is disconcerting about this outcomeis that after another two years of systemiceconomic crisis in Europe, in which the majorimpetus behind most of the reforms under-taken by the European Union was to “restore”European global competitiveness, our rank-ings, under the best of interpretations, showresults no better than in our last report.
Finally, our current report shows thecontinuing fragility of the competitive posi-tion of developing cities. Seoul is the onlyemerging city to reach the top 10 in thisindicator, with Kuala Lumpur the only otheremerging city in the top half of the rankings,
in the bottom half. This is certainly a soberingconclusion. And, once again, it points to thetenacity with which mature cities defend thecompetitive advantages they’ve accumulatedover the years, not to say decades.
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CostMature cities’ (higher) wages can successfully compete against
emerging cities’ (lower) prices
This indicator has undergone a number ofchanges since our last report. There are now
that remain unaltered are total corporate taxrate and cost of business occupancy, whichare both basic factors, not only in businesscosts but in the decision-making process thatleads to investment.
Cost of living has now replaced cost of rent andof the Internet. In order to dig even deeper intoactual, and , costs of living, however,we have also included two variables, iPhoneindex and purchasing power.
The iPhone index replaces the previous iPodindex and thus only represents an updating
of the previous variable with a more recent,and more widely used and disseminated,
of the iPhone index, however, we’ve addeda more general—but also much moredetailed—variable that measures purchasingpower over a wide range of goods, asopposed to just one consumer item. Bothvariables measure purchasing power, buteach acts as a methodological control of theother, which is also why they track closely—and in the two cases they don’t (Tokyo and,especially, Berlin), the deviations themselvesallow us to deduce some interesting facts,or at least working hypotheses, about therespective cities.
Given the extensive nature of the changes tothe indicator, the considerable reordering ofthe rankings, both generally and in the top10, is no surprise. But what is noteworthy isthat the reordering is nowhere near as wide-ranging as one would expect. Six of the top 10cities in our last report remain in the top 10 in
-ously stay there (albeit in a different orderwithin both top and bottom). This indicatorhas always been challenging, not becauseof the data gathering, which is relativelyeasy and straightforward, but because of thesubsequent assessment of the data. How doesone measure cost, after all? Is cheapest best?Or is it a matter of determining which busi-ness environment combines wages and prices
, mannerpossible, both for business in general and foreach business in particular?
Clearly, the results in this indicator tendto lead toward the latter conclusion. Los
Chicago in second place. Indeed, among the
them from North America. Among devel-oping cities, Johannesburg does best by far,
Lumpur in eighth place, and Seoul at #10.What distinguishes the North Americancities, however, is their excellent results inpurchasing power. None of the US cities, in
variable gauging that performance. For that
do very well in purchasing power. For that
do very well in purchasing power.Ô± ß²¹»´»
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Key to the variables
Air pollution
Combination of measures of PM10 (particu-late matter 10 micrometers) outdoor airpollution levels from the World HealthOrganization (WHO) and the NumbeoPollution Index of overall pollution ineach city. The WHO’s Public Health andEnvironment database provides annualmean concentrations of PM10 in diameters
The Numbeo Pollution Index is generated viasurvey-based data. Numbeo attributes thebiggest weight to air pollution, then to waterpollution/accessibility as the two main pollu-tion factors. A small weight is given to otherpollution types.
Airport to CBD access
A measure of the ease of using public transitto travel between a city’s central businessdistrict (CBD) and the international terminalof its busiest airport in terms of international
categories according to whether a directrail link exists, if so the number of transfersrequired, and if not whether there is a publicexpress bus route to the airport. Cities withdirect rail links are preferred to those withexpress bus service. Cities with rail links withthe fewest transfers are ranked higher thanthose with more. Within categories, cities areranked against one another according to thecost of a single one-way, adult weekday tripand the length of the trip, with each factorweighted equally.
Attracting FDI
Combined variable ranking of the number
investment activities in a city that are fundedby foreign direct investment (FDI). Datacover the period from January 2003 throughDecember 2012 provided by fDi Intelligence.
Broadband quality
Based on millions of recent test results fromPingtest.net, this global broadband indexfrom Ookla compares and ranks consumerbroadband connection quality around theglobe. Quality is reported in R-factor, anindustry-standard measurement for connec-tion quality (crucial for applications thatrequire a steady connection such as VOIPand online gaming). The value is the mean
R-factor over the past 30 days. Only teststaken within 300 miles of the server areeligible for inclusion in the index.
Cost of business occupancy
Annual gross rent divided by square feet
lease rates, property taxes, maintenance andmanagement costs. Data produced by CBRE
Cost of living
A relative measure of the price of consumergoods by location, including groceries,restaurants, transportation, and utilities.The relative Consumer Price Index measuredoes not include accommodation expensessuch as rent or mortgage. Figures provided byNumbeo.
Cost of public transport
Cost of the longest mass transit rail tripwithin a city’s boundaries to the CBD. Thecost of a bus trip is used in the cities wherethere are no rail systems.
Crime
Weighted combination of Mercer Quality ofLiving 2013 reports crime score (50 percent);Intentional homicide rate per 100,000 ofthe city population (30 percent); and theNumbeo Crime Index, which is an estimationof the overall crime level in each city based onhow safe citizens feel (20 percent).
Cultural vibrancy
Weighted combination of city rankingsbased on: the quality and variety of restau-rants, theatrical and musical performances,and cinemas within each city; which cities
the spirit of the times; and the number ofmuseums with online presence within eachcity. The zeitgeist rankings take into accountcultural, social, and economic considerations.
Digital economy*
Economist Intelligences report
provides an assessment of the quality ofa country’s information and communica-tions technology (ICT) infrastructure andthe ability of its consumers, businesses, and
When a country uses ICT to conduct more ofits activities, the economy can become more
Ease of commute**
were asked, “On a scale from 1 to 10, where
commute to work.” Data provided by.
Ease of entry: Number of countries
with visa waiver*
Number of nationalities able to enter thecountry for a tourist or business visit withouta visa. Excludes those nationalities for whom
-cial passports may enter without a visa.
Ease of starting a business***
Assessment of the bureaucratic and legalhurdles an entrepreneur must overcome to
for the number of procedures required to
fees and fees for legally mandated legal orprofessional services; and the minimumamount of capital (as a percentage of percapita income) that an entrepreneur mustdeposit in a bank or with a notary beforeregistration and up to three months followingincorporation. Assessment scores gatheredfrom , The World BankGroup. US cities were differentiated fromeach other using the
Survey by Thumbtack.com in partnershipwith Kauffman Foundation.
Employee regulations***
Sum of three assessment scores from theWorld Bank’s study,including: ratio of minimum wage to averagevalue added per worker; notice period forredundancy dismissal (for a worker with 10years of tenure, in salary weeks); and paidannual leave for a worker with 20 years oftenure (in working days).
End-of-life care*
Ranking of countries according to their provi-sion of end-of-life care. The Quality of DeathIndex by the EIU scores countries across four
λº»®»²½» ¤ 67
categories: basic end-of-life healthcare envi-ronment; availability of end-of-life care; costof end-of-life care; and quality of end-of-lifecare. These indicator categories are composedof 27 variables, including quantitative, quali-tative and “status” (whether or not somethingis the case) data. The indicator data areaggregated, normalized, and weighted tocreate the total index score.
Entrepreneurial environment*
Measurement of the entrepreneurial attitudes,entrepreneurial activity, and entrepre-neurial aspirations in a country. The GlobalEntrepreneurship Index (GEINDEX) integrates31 variables, including quantitative and quali-tative measures and individual-level data.
Financial and business services
employment
services activity as a share of total employ-ment in the city. Financial services includes
intermediation. Business services includes amix of activities across the following subsec-tors: real estate and renting activities, IT andcomputer related, R&D, architectural, engi-neering and other technical activities, legal,accounting, bookkeeping and auditing activi-ties, tax, and consultancy, advertising, and
and business services where not elsewhere
Foreign embassies or consulates
Number of countries that are represented byan embassy or consulate in each city. Figuressourced from GoAbroad.com.
Relocation attractiveness**
were asked, “Of the other 29 cities in Cities ofOpportunity, please rank the top three citiesthat you would like to work in most” Dataprovided by .
Health system performance*
Measurement of a country’s health systemperformance made by comparing healthylife expectancy with healthcare expendi-tures per capita in that country, adjusted foraverage years of education (years of educa-tion are strongly associated with the health
of populations in both mature and emergingcountries). The PwC Global Healthcareteam adapted methodology from the 2001
health systems: cross-national econometricanalysis.”
Hospitals and health employment
Combination of scores for: the ratio of allhospitals within each city accessible to inter-national visitors for every 100,000 membersof the total population; and the ratio ofemployment in the health sector per 100,000of the population (as provided by OxfordEconomics).
Hotel rooms
Count of all hotel rooms within each city.
Housing
Measure of availability, diversity, cost andquality of housing, household appliances,and furniture, as well as household mainte-nance and repair. This measure is based onthe Mercer Quality of Living 2013 reports.US cities were differentiated from each otherby their annual rise in house prices.
Total number of incoming and outgoingpassengers, including originating, termi-nating, transfer, and transit passengers ineach of the major airports servicing a city.Transfer and transit passengers are counted
travelers coming from different ports ofdeparture who stay at the airport for briefperiods, usually one hour, with the intention
(includes sea, air, and other transport hubs).
Innovation Cities Index
The 2thinknow Innovation Cities™ index iscomposed of 331 cities selected from 1,540cities based on basic factors of health, wealth,population, and geography. The selectedcities had data extracted from a city bench-marking data program on 162 indicators.Each of the benchmarking data was scored byanalysts using best available qualitative anal-ysis and quantitative statistics. (Where datawere unavailable, national or state estimateswere used). Data were then trend balanced
and the score reduced to a three-factor scorefor cultural assets, human infrastructure, and
these scores were competitively graded into
Upstart). The top 33 percent of Nexus andHub (and selected Node cities of future
years. A Node ranking is considered globallycompetitive.
International tourists
Annual international tourist arrivals for 100cities collected by Euromonitor International.
pass through a city, as well as actual visitorsto the city.
Intellectual property protection*
Leading business executives’ responses tothe question in the World Economic Forum’s
that asks,“How would you rate intellectual propertyprotection, including anti-counterfeitingmeasures, in your country? (1=very weak;7=very strong).” The survey covers arandom sample of large and small companiesin the agricultural, manufacturing, non-manufacturing, and service sectors.
Internet access in schools*
Leading business executives’ responses tothe question in the World Economic Forum’s
that asks,“How would you rate the level of access to theInternet in schools in your country? (1=verylimited; 7=extensive).” The survey covers arandom sample of large and small companiesin the agriculture, manufacturing, non-manu-facturing, and service sectors.
iPhone index
Working hours required to buy an iPhone4S 16GB. Data sourced from
.
Level of shareholder protection***
Measurement of the strength of minorityshareholder protection against misuseof corporate assets by directors for theirpersonal gain. The Strength of the InvestorProtection Index is the average of indicesthat measure transparency of transactions,liability for self-dealing, and shareholders’
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misconduct. Assessment scores gathered from, The World Bank Group.
Libraries with public access
Number of libraries within each city that areopen to the public divided by the total popu-lation and then multiplied by 100,000.
Licensed taxis
city divided by the total population and thenmultiplied by 1,000.
Literacy and enrollment*
Measurement of a country’s ability togenerate, adopt ,and diffuse knowledge. TheWorld Bank’s Knowledge Economic Index isderived by averaging a country’s normalizedperformance scores on variables in threecategories—education and human resources,the innovation system, and information andcommunications technology. The variablesthat compose education and human resourcesare adult literacy rate, secondary educationenrollment, and tertiary education enroll-ment. Adult literacy rate, per UNESCO, refersto the percentage of people aged 15 andabove who can, with understanding, readand write a short, simple statement on theireveryday life.
Major construction activity
The count of “planned” and “under construc-tion” buildings in the Emporis databasefor each city as of November 21, 2013.This includes structures such as high rise,skyscrapers, low rise, halls and stadia.
Mass transit coverage
Ratio of kilometers of mass transit track toevery 100 square kilometers of the developedand developable portions of a city’s land area.A city’s developable land area is derived bysubtracting green space and governmentallyprotected natural areas from total land area.
Math/science skills attainment*
Top performers’ combined mean scores on themath and science components of the Programfor International Student Assessment (PISA),an Organisation for Economic Co-operationand Development (OECD) assessment of15-year-olds’ academic preparedness. Top
(Level 5 and Level 6) on the math and scienceportions of the test. Comparable examina-tions are used wherever possible to placecities not included in the OECD assessment.
Natural disaster risk
Risk of natural disasters occurring in or neara city. Counted hazards include hurricanes,
volcanic eruptions.
Number of Global 500 headquarters
Number of Global 500 headquarters locatedin each city, as per the CNN Money FortuneGlobal 500 list.
Number of international association
meetings
Number of international association meetingsper city per year that take place on a regularbasis and rotate between a minimum of threecountries. Figures provided by members ofthe International Congress and ConventionAssociation.
on time from each city over three months(May–July 2013).
Operational risk climate*
Quantitative assessment of the risks to busi-
Assessment accounts for present condi-tions and expectations for the coming twoyears. The operational risk model considers10 separate risk criteria: security, politicalstability, government effectiveness, legal andregulatory environment, macroeconomicrisks, foreign trade and payment issues,
standard of local infrastructure. The modeluses 66 variables, of which about one-thirdare quantitative. Data produced by Economist
Percent of population with higher
education
Number of people who have completed atleast a university-level education divided bythe total population. A university-level educa-tion is set equivalent to a bachelor’s degree orhigher from a US undergraduate institution.
Political environment
Measure of a nation’s relationship with foreigncountries, internal stability, law enforcement,limitations on personal freedom, and mediacensorship. Data are from the Mercer Qualityof Living 2013 reports.
Productivity
Productivity is calculated by dividing thegross domestic product (GDP) in 2013 US$by employment in the city. Data provided byOxford Economics.
Public park space
Proportion of a city’s land area designated aspublic recreational and green spaces to thetotal land area. Excludes undeveloped ruggedterrain or wilderness that is either not easilyaccessible or not conducive to use as publicopen space.
Public transport systems
rated by the Mercer Quality of Living 2013reports. Cities also received additional pointsfor each multi-modal transport system avail-able to the public including: subway, bus/bus rapid transit, taxi, light rail, tram/trolley/streetcar, commuter rail and bike sharesystems. Each city received a tenth of a pointfor the modes of transport available withinthe city to differentiate between the 1–10scores awarded by Mercer. Cities that hada fully operational Bus Rapid Transit (BRT)system received 0.05 points (in addition tothe tenth of a point for a public bus system).Ferry systems were excluded to not penalizeland-locked cities for their absence.
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Purchasing power
Domestic purchasing power is measured byan index of net hourly wages (where NewYork=100) excluding rent prices. Net hourlywages divided by the cost of the entire basketof goods and services, excluding rent. Thebasket of goods relates to 122 goods andservices. Data sourced from
.
Quality of living
Score based on more than 30 factors across
healthcare, culture and natural environ-ment, education, and infrastructure. Eachcity receives a rating of either acceptable,tolerable, uncomfortable, undesirable, orintolerable for each variable. For qualitativeindicators, ratings are awarded based on theEconomic Intelligence Unit analysts’ and citycontributors’ judgments. For quantitative indi-cators, ratings are calculated based on cities’relative performances on a number of externaldata points. Data produced by The EconomistIntelligence Unit Liveability ranking.
Rate of real GDP growth
2012–2014 gross domestic product percentagegrowth rate in real terms expressed in 2013US$. Data provided by Oxford Economics.
Recycled waste
Percentage of municipal solid waste diverted
Resolving insolvency***
bankruptcy law and the main procedural andadministrative bottlenecks in the bankruptcyprocess. Assessment scores gathered from
, The World Bank Group.
Software development and multimedia
design
Combination of scores for each city from fDiBenchmark’s Software Development Centre
The World Bank Knowledge Economy Index(KEI). Both fDi Benchmark indices weight acity’s performance 70 percent based on thequality of the location and 30 percent basedon the cost of the location. The Softwareindex is based on an assessment of 120quality competitiveness indicators. These
indicators include availability and trackrecord in ICT, availability of specialized-skills professionals such as scientists andengineers, access to venture capital, R&Dcapabilities, software experts, quality of ICTinfrastructure, and specialization in softwaredevelopment. The Multimedia Design Centrerankings are based on an assessment of 120quality competitiveness indicators, includingthe size of the location’s leisure and enter-tainment sector, its specialization and trackrecord, information technology infrastruc-ture, quality of life, and skills availability. TheWorld Bank KEI is noted as the simple averageof normalized scores of three key variables:telephone, computer, and Internet penetra-tions (per 1,000 people).
Thermal comfort
A thermal comfort score was created foreach city by calculating the average devia-tion from optimal room temperature (72degrees Fahrenheit). January, April, July,and October heat indices were calculated foreach city using an online tool that integratesaverage high temperature and correspondingrelative evening humidity during each month.
heat index for each month and optimal roomtemperature and then averaging the absolutevalues of these differences.
Top 100 airports
Each city receives a score based on theranking of that city’s top airport in theWorld’s Top 100 Airports ranking, compiledby Skytrax.
Total corporate tax rate
The total tax rate measures the amount oftaxes and mandatory contributions payableby the business in the second year of opera-tion, expressed as a share of commercial
provide a comprehensive measure of thecost of all the taxes a business bears. Dataprovided by PwC UK from
, taxes are accurate for year ended 31December 2012. Some cities which were notincluded in the study were
using the TTC methodology. Thereport can be found at http://www.pwc.
com/gx/en/paying-taxes/.
-tion policies for each city scored on the levelof congestion, as well as the modernity,
Assessment based on Mercer Quality ofLiving 2013 reports and adjusted using IBMCommuter Pain Index.
Workforce management risk
associated with recruitment, employment,restructuring, retirement, and retrench-ment. Risk was assessed based on 30 factors
-graphic risks associated with labor supply,the economy, and the society; risks related togovernmental policies that help or hinder themanagement of people; education risk factors
-sionals in a given city; talent developmentrisk factors related to the quality and avail-ability of recruiting and training resources;and risks associated with employment prac-tices. A lower score indicates a lower degree
from the produced byAon Hewitt.
Working age population
Proportion of a city’s population aged 15–64to the total population of the city.
World university rankings
The Times Higher Education World UniversityRankings 2013-2014 powered by ThomsonReuters are the only global university perfor-mance tables to judge world-class universitiesacross all of their core missions—teaching,research, knowledge transfer, and interna-tional outlook. The top university rankingsemploy 13 carefully calibrated performanceindicators to provide the most comprehensiveand balanced comparisons available, whichare trusted by students, academics, universityleaders, industry, and governments.
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For more information
On research…
Sabrina [email protected]+44 (0) 2890 415598
Lorna [email protected]+44 (0) 28 9041 5791
On media inquiries…
Tanja [email protected]+1 646.471.6959
On business implications…
Hazem GalalCities & Local Government SectorGlobal [email protected]+974 4419 2777
Peter RaymondUS Leader, Capital Projects and [email protected]+1 703.918.1580
Jan SturessonGlobal Leader, Government & Public [email protected]+46 (0) 46 286 93 39
Egon de HaasGlobal Director, Government& Public [email protected]+31 (0) 20 5686162
Contributors
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Strategic direction
Tom CrarenBrendan DougherJohn Sviokla
Core team
PwCFran CizmarRussell DonaldsonLou GabrielDorothy JonesAdiba KhanJordana MarxRachael McBrienSabrina McColganColin McIlheneyLorna McLernonLisa OcasioTatiana PechenikIsabella PiestrzynskaWilliam Sand
EconomicsNeil Gibson, Northern Ireland Centre for
Economic Policy, University of Ulster
Graeme Harrison, Oxford Economics
DesignPwCTatiana PechenikIsabella Piestrzynska
Odgis + CompanyJanet OdgisRhian Swierat
Project direction
William Sand, communicationsand [email protected]+1 646.471.4470
Sabrina McColgan, [email protected]+44 (0) 2890 415598
www.pwc.com
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