Quebec Studies

Quebec City, Montreal, and the Impacts of Globalization

Quebec Studies (2001), 32, (1), 3–13.

Abstract

3 Quebec City, Montreal, and the Impacts of Globalization Peter Karl Kresl Bucknell University Economists and political scientists have been analyzing the consequences of the set of forces lumped under the rubric "globalization" for a couple of decades. The combination of trade liberalization, the opening of financial markets, and a rapid pace of technological advance has given us all ample material for study. By this time much that can be said about the subject has been elaborated at least once by someone, somewhere. One area that has not been as deeply mined as others is the consequences of globalization on urban economies, although this too has been getting increasing attention recently. In 1994 the Oganization for Economic Cooperation and Development orga­ nized a conference in Australia on "Cities in the New Global Economy" and since then studies have been done of most categories of cities—global, Third World, large, medium-sized, northern, and so forth. Canadian cities have also been studied with primary attention being paid to Vancouver, Toronto, and Montreal. Urban economies are affected by globalization because trade liberal­ ization creates potential new economic spaces and changes in technology enable economic actors to take actions that will realize the gains in output and efficiency that are inherent in these new spaces. Prior to globalization many urban economies were limited in their economic reach. That is, their field of employment (to use a term from Adam Smith) was limited by the existence of goods and services flow inhibiting national borders and by the cost-distance that attached to lower levels of production, transportation, and communication technologies. Globalization brought urban economies into increasingly competitive relationships with their counterparts hun­ dreds of miles distant or on other continents. Traditional economic activities were challenged by imports from more efficient producers elsewhere, but each urban economy was also presented with new opportunities for eco­ nomic development that, if economic theory is correct, will result in higher incomes and more satisfying economic lives. That this does not always hap­ pen is in part due to the imperfections that are more likely to be found in reality than in the world of economic theory, but it is also due in part to the inability of local decision-makers to mobilize their resources and other assets effectively. Those cities that make the correct decisions and actions ex­ perience the gains that theory tells us are available, while those that do not are condemned to futures of stagnation and marginalization. This impor­ tance of local decision-making is increased by the self-imposed diminution of the ability of national governments to intervene in their own economies and the concomitant devolution of responsibility to subnational and urban levels of government. Hence, the impact of globalization on urban econo­ mies is one of the most interesting areas for study. Québec Studies, Volume 32, Fall 2001/Winter 2002

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Kresl, Peter