Menus Subscribe Search

Burgh Diaspora

cleveland-river

The west bank of the Flats and the Cuyahoga River in downtown Cleveland. (Photo: Public Domain)

Connecting Neighborhoods, Not Nations: Small Geographic Scales of Globalization

• March 18, 2014 • 10:02 AM

The west bank of the Flats and the Cuyahoga River in downtown Cleveland. (Photo: Public Domain)

The financial crisis turned the world upside down.

Globalization doesn’t connect nation states or urban regions. Via talent migration, globalization connects neighborhoods. Richard Florida with some numbers detailing the economic geography of globalization in the United States:

America’s wealthiest neighborhoods are also concentrated in a relatively small number of metros across the country. … Nearly a quarter of them are in the New York metropolitan area. Another ten percent (102) are found in Greater Washington, D.C. The Bos-Wash corridor — including D.C., Baltimore, Philadelphia, New York, Hartford, Providence, Worcester, and Boston — accounts for 41 percent. On the West Coast, greater L.A. (including Orange County) is home to 9 percent, and the Bay Area as a whole (the Combined Statistical Area that includes Oakland and San Jose) accounts for another 6 percent.

To repeat, 41 percent of America’s wealthiest neighborhoods are concentrated along the East Coast from Boston to Washington, DC. Citing another Richard Florida statistic, the economy of the Bos-Wash corridor is larger than Germany’s (currently the fourth biggest economy in the entire world). But the scale of megalopolis obscures how globalization has changed from a game of bigger is better to a dance with someone you know and trust. The financial crisis turned the world upside down:

The recent financial turmoil has shattered many of the previous assumptions in the 21st-century banking world. It has become painfully clear that moving credit risk round the world in complex chains did not make the system safer and more efficient – as bankers once claimed.

So, as bankers reel in shock, this poses an intriguing new question: will recent experience now force a rethink of assumptions in non- financial spheres too? After all, in recent years so-called “Davos man” has taken it for granted that globalisation, free market capitalism and innovation were all thoroughly good things. But as faith wilts, might business leaders rethink their dependency on, say, cross-border manufacturing supply chains, too?

There are hints of a change afoot. This week, for example, Gerard Kleisterlee, chief executive of Philips, the electronics group, told the Financial Times he expected large companies to move away from far-flung globalised supply chains. He blamed the shift on “green” issues, explaining “a future where energy is more expensive and less plentifully available will lead to more regional supply chains”.

Emphasis added. We no longer trust in numbers. Too big to fail is too big to do business. Boutique globalization:

Blair Effron, one of the founders of the independent investment bank Centerview Partners, says the rise of boutiques has been predicated on their ability to work closely with a much smaller client base. “We are around our clients all the time, not just when they are doing transactions, and try to go as deeply as we can to understand their businesses.” …

… “The balance sheet plays less of a role in deals, which means advice and human capital have become a more wanted quantity,” says Ashley Serrao, a banking analyst at Credit Suisse.

The tilt towards seeking advice from specialist M&A advisers rather than defaulting to one bank for all a company’s financial needs points to an increasingly fragmented professional services landscape. In the case of the banking sector, it also illustrates the migration of talent from bulge-bracket lenders to smaller operations, removed from the regulatory and political wrangling that has dogged big banks since the start of the financial crisis.

The talent migration from bulge-bracket lenders to smaller operations mirrors the real estate refugee’s relocation down the urban hierarchy. The scale of commerce withdraws to the neighborhood. Financial capital follows human capital along lines of trust:

“I cannot scale my business because I cannot hire enough of the quality of people needed,” says Mr Studzinski. “In a boutique you don’t have the balance sheet and product suite to fall back on, so you need people who already have serious, trusted relationships who can bring in business and a network from the start – that’s a rare person.”

Globalization is not dead or dying. Globalization is diffusing from centers of agglomeration. The agents of diffusion are talent itself, gentrifying Cleveland neighborhoods with international social capital amassed in Brooklyn.

Jim Russell

A weekly roundup of the best of Pacific Standard and PSmag.com, delivered straight to your inbox.

Recent Posts

August 20 • 4:00 PM

Why Can’t Conservatives See the Benefits of Affordable Child Care?

Private programs might do a better job of watching our kids than state-run programs, but they’re not accessible to everyone.


August 20 • 2:00 PM

Oil and Gas Companies Are Illegally Using Diesel Fuel in Hundreds of Fracking Operations

An analysis by an environmental group finds hundreds of cases in which drillers used diesel fuel without obtaining permits and sometimes altered records disclosing they had done so.


August 20 • 12:00 PM

The Mystery of Britain’s Alien Big Cats

In a nation where the biggest carnivorous predator is a badger, why are there so many reported sightings of large cats?


August 20 • 10:00 AM

Death Row in Arizona: Where Human Experimentation Is the Rule, Not the Exception

Recent reports show that chemical roulette is the state’s M.O.


August 20 • 9:51 AM

Diversity Is in the Eye of the Beholder

Perception of group diversity depends on the race of the observer and the extent to which they worry about discrimination.


August 20 • 8:40 AM

Psychopathic or Just Antisocial? A Key Brain Difference Tells the Tale

Though psychopaths and antisocial people may seem similar, what occurs in their brains isn’t.


August 20 • 8:00 AM

What the Cost of Raising a Child in America Tells Us About Income Inequality

You’ll spend nearly a quarter of a million dollars to raise a kid in the United States, or about five times the annual median income.


August 20 • 6:00 AM

In Praise of ‘American Greed’

While it remains semi-hidden on CNBC and can’t claim the car chases of Cops, American Greed—now with eight seasons in the books—has proven itself a worthy endeavor.


August 20 • 4:00 AM

Of Course I Behaved Like a Jerk, I Was Just Watching ‘Jersey Shore’

Researchers find watching certain types of reality TV can make viewers more aggressive.


August 20 • 2:00 AM

Concluding Remarks About Housing Affordability and Supply Restricitions

Demand, not supply, plays the dominant role in explaining the housing affordability crisis. The wages are just too damn low.


August 19 • 4:00 PM

Can Lawmakers Only Make Laws That Corporations Allow?

There’s a telling detail in a recent story about efforts to close loopholes in corporate tax laws.




August 19 • 12:00 PM

How ‘Contagion’ Became Contagious

Do ideas and emotions really spread like a virus?


August 19 • 10:00 AM

Child Refugees: The New Barbarians

The disturbing rhetoric around the recent rise in child refugees into the United States from Central America may be shaping popular opinion on upcoming immigration reform.


August 19 • 8:00 AM

Making Police Departments More Diverse Isn’t Enough

Local police departments should reflect the communities they serve, but fixing that alone won’t curb unnecessary violence.


August 19 • 7:15 AM

Common Knowledge Makes Us More Cooperative

People are more inclined to take mutually beneficial risks if they know what others know.


August 19 • 6:00 AM

Seeking a Healthy Public School Lunch? Good Luck

Mystery meat will always win.


August 19 • 4:00 AM

The Positive Effects of Sports-Themed Video Games

New research finds sports-themed video games actually encourage some kids to get onto the field.


August 19 • 1:00 AM

DIY Diagnosis: How an Extreme Athlete Uncovered Her Genetic Flaw

When Kim Goodsell discovered that she had two extremely rare genetic diseases, she taught herself genetics to help find out why.



August 18 • 3:30 PM

Mister Rogers’ Heart-Healthy Neighborhood

Researchers find living in a friendly, cohesive neighborhood lowers seniors’ chances of having a heart attack.


August 18 • 2:00 PM

Wealth or Good Parenting?

Framing the privileges of the rich.


August 18 • 12:00 PM

How Much Did the Stigma of Mental Illness Harm Robin Williams?

Addiction treatment routinely fails people with mental illnesses, while mental health care often ignores addiction. And everywhere, stigma is rife. Can a tragic death prompt a more intelligent approach?


August 18 • 10:00 AM

Punished for Being Poor: The Problem With Using Big Data in the Justice System

Correctional departments use data-driven analyses because they’re easier and cheaper than individual assessments. But at what cost?


Follow us


Diversity Is in the Eye of the Beholder

Perception of group diversity depends on the race of the observer and the extent to which they worry about discrimination.

Psychopathic or Just Antisocial? A Key Brain Difference Tells the Tale

Though psychopaths and antisocial people may seem similar, what occurs in their brains isn’t.

Common Knowledge Makes Us More Cooperative

People are more inclined to take mutually beneficial risks if they know what others know.

How a Shift in Human Head Shape Changed Everything

When did homo sapiens become a more sophisticated species? Not until our skulls underwent "feminization."

Journalists Can Get PTSD Without Leaving Their Desks

Dealing with violent content takes a heavy toll on some reporters.

The Big One

One in two full-time American fast-food workers' families are enrolled in public assistance programs, at a cost of $7 billion per year. July/August 2014 fast-food-big-one
Subscribe Now

Copyright © 2014 by Pacific Standard and The Miller-McCune Center for Research, Media, and Public Policy. All Rights Reserved.