Thomas Friedman’s The World is Flat and Richard Florida’s The World is Spiky offered competing hypotheses on the underlying drivers of the world’s current economic order. Friedman’s Flat World hypothesis suggested that technological advances have provided individuals with the power to collaborate and compete globally and, in doing so, have begun to develop a single knowledge network that is raising standards of living in developing places and providing developed countries with additional markets and demands. According to Friedman, this ‘flattening’ of the world enables companies and individuals to source work anywhere and has created an environment where companies must take advantage of market and labor arbitrage strategies that decrease costs and increase efficiency through off-shoring and outsourcing (Friedman, 2007). Ultimately, Friedman concluded, this allows companies to “be more global than ever and, yet, at the same time, more personal than ever” (2007, p. 45).
Conversely, Florida analyzed geographic, patent generation, and economic activity data and concluded that a few cities and regions are responsible for the vast majority of global innovation and growth. With patent generation and scientific advances concentrated in several American, European, and Asian cities, Florida suggested that “surprisingly few regions truly matter in today’s global economy” (2005, p. 48). According to Florida, innovation, economic growth, and prosperity occur in the locations that attract top creative talent and, due to economic forces that are concentrating people and resources, a few cities and regions that drive the world economy are growing while other locations are languishing (2005). Finally, in a nod to Friedman’s Flat World meme, Florida stated that the current economic order has resulted in a slight dispersal of the world’s peaks and a shift of the world’s hills. However, these shifts have not fundamentally altered the reality that innovation remains firmly concentrated.
Of these two competing interpretations, Florida’s innovation concentration model resonated with me and is more supported by available GDP statistics. According to the McKinsey Global Institute, the world’s largest 100 cities generated 38% of total global GDP in 2007, while the largest 600 cities generated over 60% of global GDP in the same year (McKinsey, 2011). Company analysts predicted that 2 billion people will live in the world’s largest 600 cities by 2025, a number that equates to 25% of the global population. Within this selection of cities, the major urban areas in developed regions accounted for the majority of the total GDP figure, with the 380 developed world cities listed in the top 600 responsible for over 50% of 2007’s global GDP (McKinsey, 2011). These figures indicate economic activity is extremely concentrated in a small number of urban, mostly developed-world locations.
Interestingly, McKinsey analysts agreed with Florida that the world’s peaks and hills will shift over the next decade; based on population growth estimates and other factors, the company projected its list of the world’s 600 largest cities will change as the center of gravity of the urban world moves to China, India, and Latin America. This shift, which will see the rise of over 100 major cities in China and over a dozen in India, will provide development opportunities in these locations and create additional markets for multinational corporations interested in expanding to high-growth population centers. This is where I see the applicability of Friedman’s Flat World theory – these upcoming urban areas will benefit from the trends Friedman identified and will likely grow faster and contribute more to GDP because residents are more able to collaborate and compete globally and corporations are more inclined to invest and recruit in these areas. Overall, I see the world flattening in certain specific locations – while Friedman is correct that the companies and individuals possess technology that enables them to work effectively from anywhere, GDP growth, patent production, population growth, and general economic activity is still concentrated in a very small number of places. This suggests that the technology Friedman identifies as responsible for leveling the global playing field is mainly doing so and will continue to do so in a small number of urban centers.
In terms of this week’s learning objectives, new media and web-based tools and practices are certainly enabling individuals and corporations to employ out-sourcing, home-sourcing, and other labor practices that save time and money. Furthermore, these tools are encouraging collaboration, developing new avenues for investment, and increasing productivity. With the advent of new media and web tools, workers have more freedom of movement, more access to information, and are better able to communicate, connect, and produce without regard to time and space. These factors are driving productivity gains while also fundamentally changing the relationship between an employer and an employee – with such easy access to data and the ability to work from anywhere, the barriers between the office and the home are deteriorating and employees are expected to remain in constant contact with their professional responsibilities. This is slowly erasing the typical defined hour work week for many professionals, and replacing it with a work continuum that accounts for time, space, duties, and connectivity capabilities.
Florida, R. (2005, October). The World is Spiky. The Atlantic Monthly, 48-51.
Friedman, T. (2007). The World is Flat (3rd ed.) New York: Picador.
McKinsey Global Institute. (2011). Urban World: Mapping the Economic Power of Cities. McKinsey & Company.