Monday, 22 August 2016

Prof Cohen responds to Prof Wall, Chair in Economic Development in the City of Johannesburg

On the 5th May this year, the School of Economic and Business Sciences (where this project is housed) welcomed Prof Ronald Wall to the (new) Chair in Economic Development in the City of Johannesburg. Prof Wall presented a lecture titled: Glocal Competitor: Boosting Johannesburg’s Power within the Global Economic System.

Prof Jason Cohen, principle researcher on the Information Systems for Smart Cities in Africa project, responded to Prof Wall's presentation as follows: 

Honourable guests, ladies and gentleman.

Professor Wall, congratulations and thank you for an excellent lecture. And welcome again to Wits and to the Faculty.

Professor Wall’s work brings to the fore the simple but powerful idea that we need to understand cities not as separate territories but rather as nodes within a global network, and importantly that what happens within cities is then connected to what happens between cities. Professor Wall thus argues and demonstrates in his work that the characteristics of a city node influence its position (or what he calls its prestige) in the network.

Professor Wall’s work is a stellar example of the promise of big data, the value of cutting edge applications of data visualization, and of how interrogating large datasets with network and cluster analysis allows us to arrive at fresh insights.

And when you have the sorts of hard data that Professor Wall is providing, we see just how important policy choices by cities are to the outcomes that we observe.

And as with all good research, the quality of Professor Wall’s work is evident also in the additional questions and debates that can arise from it. I’d like to kick-start the discussion process by raising some brief points, I have about 5 minutes and 5 points.

Let me say that I offer my perspectives in the spirit of an inter-disciplinary engagement. I am not an economist, but my work into smart cities and ICT driven innovation within cities has many touch-points with Ronald’s work. So I believe we are dealing with a shared problem of how we can develop a better City that is not only more economically competitive but also addresses the problem of inequalities and in which where residents can enjoy higher quality of life. 

My first question is about how we balance interests in the process of developing the attractiveness of the city to FDI. Ronald spoke of tensions between wealth and wellbeing.

We can infer from Ronald’s work that to attract a mass of investment, a city needs to match investor demand for city characteristics with the supply or provision of the relevant infrastructure, services and amenities (i.e. urban competitiveness). For me, this raises a question as to whether the properties of a City most likely to attract foreign investment are always and necessarily compatible with the properties of a City reflective of the needs of residents.

In our Information Systems for Smart Cities in Africa project work, we define city smartness in terms of the improvements city initiatives bring to the satisfaction and quality of life of city residents. And we have spent some time eliciting and mapping residents’ priorities, and determining which initiatives are most important to their satisfaction. How then might a more relativist and resident-centred view of important city characteristics clash with (rub up against) those characteristics of a city found most necessary for FDI attractiveness?

How do we balance and prioritize the needs of residents within the city against those of outside investors? Whose interests are advanced in the process? And what are the consequences of mismatches. Ronald’s work thus leads us to this recognition that our work on cities is not just about data, but is as much about values, and our study of cities must inevitably engage us in important social choice debates – about the investments we want to attract, into what sectors, and the consequent implications for city characteristics. 

My second question is about preference and trade-off.

If we are to convince firms from across key targets sectors, and individuals, that they are better off in Johannesburg than in competitor cities then we need to know not only what characteristics of cities make them more attractive but also why those factors matter. And to know why they matter, do we not then need to probe certain fundamental questions of firm behaviours and individual preferences. If we argue that we are actually dealing with a bundle of city characteristics then we need to uncover the trade-offs that people and firms are prepared to make across infrastructure, services, amenities etc. 

As an example, in our work with COJ residents, we have found a sample of COJ residents prepared to trade faster broadband and a more efficient public transportation infrastructure for better individual safety and more affordable housing. So there may be value in thinking about the attractiveness of cities from these base principles of utility and trade-off with a focus on identifying those bundles of city characteristics that match the preferences of investors, firms and individuals. A similar argument has been made by Michael Storper in his book on Keys to the City[i] when discussing the growing attractiveness of the southern US sunbelt states over the north-eastern US (which we saw as those huge spikes in Ronald’s visual).

My third question is about kick-starting new patterns of global investment.

We learned from Ronald that COJ is 6th in total African FDI. Ronald’s analysis shows us that city-level characteristics matter for FDI attraction. But which is the chicken and which is the egg?

Investment especially in greenfield FDI can lead to the economic development and smartness of cities (including increases in employment, labour productivity, skills, technology transfer – under certain conditions). But we’ve also seen that FDI is more likely to be attracted into cities with certain characteristics that in themselves already reflect a particular level of development. For example COJ’s ‘betweenness’ strength may be a function of the strength of our institutions. So the determinants of FDI attraction may also be the outcomes of FDI attraction. If the relationship is indeed cyclical, how can it best be kick-started? How do we ensure that existing patterns of global investment do not simply reproduce? 

My fourth question is about different approaches to gaining glocal knowledge of cities.

One approach is to pursue the major shared determinants of network centrality (FDI attractiveness). Here, the construction of parsimonious models that provide for the best possible explanations are favoured. Yet, another approach would focus on obtaining richer pictures where the lived experiences of people within the city can be teased out and appreciated, including how city characteristics have influenced and been influenced by investor actions. Here, the focus is on the unique attributes of a city, the focus is on differences rather than on those shared determinants. Proponents of such approaches might argue that the unique conditions and characters of our cities cannot simply be relegated to the noise and error terms of a parsimonious model. So how can we combine the contributions of both research groups into our conclusions and recommendations on the city? I ask this question in particular because Ronald has mentioned his interest in the potential of qualitative work. 

My fifth and final question is a longer-term and perhaps classic question for those interested in the development of cities.

Are we inevitably going to see the end of cities? We are already seeing electronic commerce, telehealth, telework, online education, technology-enabled business process outsourcing, and other technology and ICT-enabled advances breaking down traditional assumptions of how and why cities need to organize. Will technology lead us to the point where density in metropolitan areas disappears? In other words, will technology make the flow of goods, people and information so easy and seamless that we no longer need to cluster in cities?

Professor Wall, thank you once again for your thought provoking and insightful analyses, and I look forward to the exciting work that will come from your Chair.

[i] Storper, M. (2013). Keys to the City: How Economics, Institutions, Social Interaction, and Politics Shape Development, Princeton University Press.

Thursday, 18 August 2016

Congratulations to Masters student Malefa Topo

Congratulations to Malefa Topo who graduated on the 7th July with her M.Com. Her dissertation was titled: "Explaining the use and non-use of smart cities services in Johannesburg: resident's perspectives".

Malefa was our Masters bursary recipient and project manager for 2015.