Review of Richard Florida’s Who’s Your City?

ETHOS Issue 05, Nov 2008

When Thomas Friedman asserted that “the world is flat”, he could hardly have imagined that it would one day be countered by another notion: that the world is in fact “spiky”. This is precisely what Richard Florida argues in his new book, Who’s Your City?. Florida, an academic in economy development and demography, is best known for his writings on the rise and flight of the creative class—a catch-all reference to the strata of talented individuals in a society, including scientists, writers, artists and designers, who create the new knowledge, technology and innovations that drive economic and cultural development. His current book is the product of extensive research on the relevance of place to the creative class; it paints a convincing picture of a world where the geographical congregation of diverse, creative talent is now a key underlying driver (or at least a pre-requisite) for economic growth and cutting-edge innovation.

What the world really looks like

Florida aims not so much to debunk the great levelling effect of globalisation as to puncture the belief that the world is only flat. He makes the case that the global economy that emerges is in fact full of “peaks and valleys”. Through empirical data and detailed visual maps, Florida illustrates the increasing clustering of population, innovation and higher-level economy activity in only a handful of locations, which Florida describes as “mega-regions”. He considers these regions, which include agglomerations of adjoining cities and suburbs, as the true fundamental economic units of the world—contrary to past theories of growth which tended to look exclusively at nations and firms, and discount the relevance of location.

Florida identifies a few dozen mega-regions worldwide, across the United States, Europe and Asia, of which the largest is Greater Tokyo, followed by the Boston-New York-Washington corridor, and the Chicago-Pittsburgh mega-region. These mega-regions house a range of 5 to 100 million people and produce hundreds of billions, and even trillions, worth of economic output. They amass talent, production, innovation and markets on a massive scale and pace that far surpass that of their neighbours.

Why does the world look this way?

What sustains this accelerating concentration of economic growth? Florida describes this "clustering force" as the "tendency of creative people to seek out and thrive in like-minded groups, and the self-perpetuating economic edge that comes from their doing so". This edge derives from the sheer productivity advantages, economies of scale, and knowledge spillover effects available to creative people and firms when they cluster.

Such clustering may be viewed as the centripetal force of globalisation that concentrates economic activity, versus the centrifugal force of globalisation which spreads it out. In reality, the two forces act in concert. The economic value of "spiky" creative input is consolidated and realised through centripetal forces which increase the returns on value-added activities (through faster roll-out of services and goods worldwide), thereby attracting more talent and innovation to these locations, and making them even "spikier".

"Means migration" describes the re-location of highly educated and skilled people to the small number of metropolitan areas ("means metros") and the corresponding exodus of the lower to middle classes outward from these places.

The powers of agglomeration and "preferential attachment" (in which creative people attract other inventive people) explain why these peaks continue to ascend, and grow closer together, while the "valleys" sink and diverge. In effect, the clustering force sorts locations into a hierarchy, by concentrating not only talent but also jobs, industries and firms within regions, on an unprecedented scale.

But what about the competitive dynamics and drivers between regions and cities during the clustering process? If two talent hubs start off with similar economic conditions and talent clusters, how will they compete such that one (or both) emerges as the winner? It is unclear which precise factors best determine the outcome.

Geography of happiness

It turns out that people are happier in places with higher concentrations of personality types like themselves. Florida’s findings from his Place and Happiness Survey further reveal that not only is place important to individual happiness, different cities affect happiness differently. In fact, cities, like people, have distinct personalities, which attract certain types of people over time. For example, “experiential” cities like New York and Boston have more “open-to-experience” personality types, while “conventional dutiful” regions like those in the Sun Belt¹ have more agreeable and conscientious people.

Florida argues that psychological fit clearly defines “place happiness” and people’s migration choices. This implies that the global sorting of locations is not just based on jobs, education and skills, but also on basic personality types.

But why should happiness be important? Florida draws attention to studies demonstrating that place happiness “activates” people to do more and engage in more creative activities that spur economic growth, in a regenerative cycle. So could the geographical clustering of personality types explain regional growth and innovation?

The answer, according to Florida’s data, is a resounding yes. He finds that not only do personality variables explain a substantial portion of regional variance in innovation, talent, income and even housing values, an “open-to-experience” personality is the most consistently linked to regional economic growth.

Openness is also associated with curiosity which predicts where creative people and ideas congregate. In short, openness is a driving factor of regional innovation and growth by helping cities to attract and capitalise on diversity and creativity. Places like London, New York and the San Francisco Bay area are stellar examples of their ability to attract and mobilise “open-to-experience” people.

Moving through the life stages

At the end of the book, Florida attempts to make the book of practical use by including a self-help section to guide people in their decisions on the best places to live, particularly for the three big moves they will face in life: when they graduate from college, when they have children, and when their children leave home. The basic considerations—economic opportunity, basic services, security and aesthetics—are necessary but assumed. Instead, the implication Florida makes is that people will move to places that fit their evolving needs as their life phases change, and that places (including cities) will develop specialisations in the life stage they fit best.

Whose city is Singapore?

Given the myriad choice of global destinations, will Singapore emerge as one of the leading “spike” locations attracting the most creative and skilled talent? Florida, as a cartographer of mega-regions, describes Singapore as having become a “top destination for innovative people of all lifestyles and interests”. Can we sustain our competitive edge and continue to re-invent ourselves? Should we specialise to cater to a particular phase of life?

It is apparent a city’s success now relies much less on the ownership of factors of production. The critical issue is how to attract enough creative, “open-to-experience” talent who will form a critical mass attracting the inputs of other talents. Perhaps, the first step, relating to Florida’s mapping of place happiness, is to recognise the major role that psychology can play in driving economic structure and growth. We should thus seek to understand what Singapore’s personality is and how it plays out in the global mindshare. Do we give people a sense of openness and welcome? Can people conjure who are the diverse and creative people living in Singapore?

Multi-agency efforts are already in place to brand Singapore in the global consciousness. But whom should we be trying to attract?

The answer is probably young people. Florida describes regions in the US which attract young people as not only as emerging winners in the competition for talent, but also gaining a long-term economic and demographic first-mover advantage that is difficult to catch up with. There is only a small window of opportunity. While young people are the most likely to move of any demographic group, their propensity to re-locate declines sharply with age. Taking account of this effect, the Ministry of Manpower introduced the Work Holiday Programme in 2008 to make it easier for young global talent to work and holiday in Singapore. In the long run, we will need to broaden and deepen our outreach to young students and professionals overseas, an effort which agencies such as Contact Singapore are spearheading.

So will Singapore come to specialise as a place for the young? Probably not. There are several cities which Florida identifies as “generalist places” which not only appeal to people across different life stages but also have thriving economies and societies. Two prime examples of “generalist” locations are the San Francisco Bay area and Boston. On the other hand, Florida and Arizona are “specialised” regions drawing many wealthy retiring baby boomers.

Might Singapore conceivably become a global leisure village for rich retirees or well-established mid-career professionals? One clear adverse effect would be the “gentrification” of place which often pushes up housing prices that, at escalating levels, can inhibit innovation (due to lack of cheap space to house creative activity) and reduce attractiveness to new talent. Greying demographics and extended healthcare needs can also burden the broader economy over time. More critically, as both a nation and a city, Singapore cannot afford to cater only to a particular demographic; instead, it must maximise the gains that diverse groups at different life phases can bring. Indeed, young people would also want solid options as they progress in life, and to be able to exercise real flexibility and choice in career, lifestyle and family size. Singapore has the potential to become an attractive “generalist” hot spot, with distinct, different and inclusive communities that are attractive to different people at various stages in life. This is more likely to encourage the talent that does come to Singapore to stay on for good.

Talent retention is an issue Florida does not dwell on. However, he does note that there are those with the means to migrate who choose to stay rooted. A big reason is that close personal and social relationships can outweigh economic opportunities. This implies that social networks can be tapped to retain talent. Some global nomads might be more inclined to settle if they are able to reach their potential and find happiness with their families and communities around them. Gallup surveys of foreign talent in Singapore also indicate that social networks are particularly important to segments of talent and greatly affect their satisfaction with life here. The broader point is that increasingly, our talent strategy will have to encompass softer, intangible factors that matter to people.

Last but not least, it is interesting to note that mega-regions develop from city-regions growing outwards and into one another, rather than simply growing upward. For Singapore, this process of merging presents an inherent constraint, as there is no physical hinterland for us to expand into. This signifies that we have to leverage the world as our hinterland and build a “Greater Singapore” mega-region, through extending our economic, trade and transport links to all corners of the world map, and by finding innovative ways to include overseas Singaporeans as part of our extended social and economic base.

Conclusion

Florida’s Who’s Your City? delivers a persuasive, well researched and cogent argument for the key importance of location in today’s global economy, albeit one centred mainly on US cities. Nevertheless, it should convince readers to ask themselves the question more often: “Where should I choose to live?” For policymakers, the burning question might be: “How can we become the place where the best talent would choose to live?”

NOTES

1. The Sun Belt is a geographic region commonly perceived to stretch across the south and southwest of the United States, which has seen substantial population growth in recent decades, partly fuelled by a surge in retiring baby boomers who have migrated domestically, as well as the influx of migrant workers.