Analyzing Diversity, Strength and Centrality of Cities Using Networks of Multinational Firms

Abstract

Cities play an important role in the regional, national and continental development of economies, as well as global trade and infrastructure. Most of this development revolves around the presence of multinational firms and the interconnected systems formed by their linkages. Analyzing the networks formed by these multinational firms can uncover many interesting trends and patterns providing insight into not only the development of individual cities, but also the various world regions they belong to. In this paper, we are particularly interested in networks of cities from the year 2010 and 2013 in order to understand how cities have changed in the context of networks of multinational firms. We consider diversity, strength and centrality as the key indicators to measure the importance of a city and based on these indicators analyze how cities have changed their roles in the networks of multinational firms overtime. We also introduce a cumulative ranking based on these three indicators to position cities in terms of their importance in the world. This study not only strengthens previous findings from a network analysis perspective but it also reveals the cities with considerable growth and/or significant decline over the periods studied.

Multinational Firms and the Economic Self-Reliance of North American Cities

“…Sassen also examined the influence of these linkages on resulting social structures, emphasizing the significance of global cities [45]. Similarly, Hussain et al analyzed various city characteristics using data from multinational firms to highlight the power and centrality of certain cities in the world economy [23]. Building upon prior research, our study utilizes networks of cities to examine stable and changing cities in terms of economic growth in the North American region.…”

“…Building upon prior research, our study utilizes networks of cities to examine stable and changing cities in terms of economic growth in the North American region. Hussain et al evaluated cities according to their diversity, centrality, and strength to distinguish established and evolving cities [23]. Wang also examined the performance of global cities using Data Envelopment Analysis and the Malmquist index, taking numerous factors such as economics, research and development, among others [50].…”

Modeling Supply-Chain Networks with Firm-to-Firm Wire Transfers

“…For instance, seeSerrano and Boguñá (2003);Fagiolo et al (2008);Fan et al (2014);Shen et al (2015) for empirical research on the global economic network. A notable exception isHussain et al (2019), who study a network of cities at the global level.…”