C HAPTER 12: K EY I SSUE 4 Kylie Erickson and Erin Atkinson

H IERARCHY OF B USINESS S ERVICES Geographers distinguish four levels of urban settlements according to their importance: 1. World Cities 2. Command and Control Centers 3. Specialized Producer-Service Centers 4. Dependent Centers

W ORLD C ITIES Divided into 3 tiers: 1. Dominant World Cities: London, New York, and Tokyo are all the largest cities of the 3 main regions of the more developed world. Where stock exchanges operate (business related services) 2. Major World: Chicago, Los Angeles, and Washington in North America, Brussels, Frankfurt, Parish, and Zurich in Europe in MDCs, and also Sao Paulo and Singapore in LDCs. Headquarters for banks and major corporations. 3. Secondary Word Cities: 4 in North America (Houston, Miami, San Francisco, and Toronto), 7 in Asia (Bangkok, Bombay, Hong Kong, Manila, Osaka, Seoul, and Taipei), 5 in Europe (Berlin, Madrid, Milan, Rotterdam, and Vienna), 4 in Latin America (Buenos Aires, Caracas, Mexico City, and Rio de Janeiro), one in Africa (Johannesburg) and one in Oceania (Sydney)

C OMMAND AND C ONTROL C ENTERS These contain the headquarters of many large corporations, well-developed banking facilities and other businesses (insurance, accounting, advertising, law, and public relations) They also contain important educational, medical, and public institutions. Two levels of Command and Control Centers:  Regional centers  Subregional centers

S PECIALIZED P RODUCER -S ERVICE C ENTERS These centers offer more narrow and highly specialized variety of services. One group of these cities specializes in management and a second group of these cities specializes as centers of government and education.

D EPENDENT C ENTERS Provides relatively unskilled jobs and depend for their economic health on decisions made in the World Cities, regional Command and Control centers, and Specialized Producer-Service Centers. Four types of dependent centers in the United States:  Resort, retirement, and residential centers. (clustered in the South and West)  Manufacturing centers. (clustered in the old Northeastern manufacturing belt)  Military Centers. (clustered mostly in the South and West)  Mining Centers. (clustered in mining areas)

B USINESS S ERVICES IN LDC S LDCs specialize in 2 types of business services: o Offshore financial services- small countries/islands, and they provide 2 important functions: Taxes- typically low or nonexistent Privacy- bank secrecy laws can help individuals in businesses evade disclosure in their home countries o Back Offices- processing insurance claims, payroll management, transcription work, and responding to billing. Attracted for 2 reasons: Low wages- most workers earned a few thousand dollars per year, considered high in LDCs. Ability to speak English- only a few LDCs have a large labor force fluent in English

E CONOMIC B ASE OF S ETTLEMENTS A settlements distinctive economic structure derives from its basic industries (exports to consumers outside the settlement). Nonbasic industries are enterprises whose customers live in the same community. A community’s collection of basic industries defines its economic base.

S PECIALIZATION OF C ITIES IN D IFFERENT S ERVICES Each type of basic activity has a different spatial distribution. The concept of basic industries originally referred to manufacturing. Examples of Settlements specializing in Business Services: General Business: Los Angeles, New York, and San Francisco. Computing and Data Processing Services: Boston and San Jose. High Tech Industries Support Services: Austin, Orlando, and Raleigh-Durham Military Activity Support Services: Albuquerque, Colorado Springs, Huntsville, Knoxville, and Norfolk. Management Consulting Services: Washington DC Examples of Settlements specializing in Consumer Services: Entertainment and Recreation: Atlantic City, Las Vegas, and Reno Medical Services: Rochester and Minnesota. Examples of Settlements specializing in Public Services: State capitals, large universities, and Military bases.

S UMMARY Financial, professional, and other business services cluster disproportionately in large world cities to support the operations of major corporations. World cities also play major consumer- and public-service functions.