Geographies of the global economy
Detroit (seminar 3)
March 9th and 10th 2023
Etieno Enang
[email protected]
Today’s Seminar
Introduction, Group assignment recap
Geography and place matter
Detroit case study
Finetuning, finalizing on your introduction section
Next steps
Attendance Code
706538
• Handbook and Canvas
• 6 weeks: lectures
& seminars
• Asynchronous material
• Group work and Report
• Work effectively together
• Deadline on 12th May
• Be proactive
• No such thing as
a silly question!!
Module Overview
Group Assignment and Report
• Marking in this module will be based on a group report (100% of
students’ mark). All group members receive the same grade (there
are exceptions)
• The core aim of this assignment is to improve and test students’
understanding of the global economy’s spatial characteristics (see
learning goals). Each student is expected to positively engage in
the group work to deliver a quality Report
• Small groups (ideally 4 or 5 students per group). All members must
be in the same Seminar Group (1 or 2) on Thursday or Friday
afternoons
• Student teams will pick a particular topic to focus on related to
competitiveness (e.g. innovation, GDP growth, industry
emergence, export, FDI, Quality of Life etc).
• Then, focusing upon four cities, Frankfurt, Detroit, Mumbai and
Bucharest, compare and contrast the ways in which globalisation plays
out geographically, using the theoretical concepts introduced in the
course
Executive Summary (about 100 to 250 words)
1. Introduction (600) (joint group contribution)
2. Literature review (1600) (joint group contribution)
3. Analysis of Frankfurt (2000) (individual student contribution)
4. Analysis of Detroit (2000) (individual student contribution)
5. Analysis of Mumbai (2000) (individual student contribution)
6. Analysis of Bucharest (2000) (individual student contribution)
7. Comparison of the four cities (1200) (joint group contribution)

Group Report structure (recommended word count):
Today’s Seminar
Introduction, Group assignment recap
Geography and place matter
Detroit case study
Group breakout rooms
Next steps
Geography matters
• “Without geography, you’re nowhere”
• External / agglomeration economies
Localization
Urbanization
• Sticky knowledge
Clusters
• Clusters:
‘Geographic concentrations of interconnected companies and
institutions in a particular field’ – Porter 1998, p. 78
• Silicon valley, Silicon Roundabout, Aerospace Valley, Dutch
flower cluster, Castellon ceramic tile, etc.
• Once upon a time, the Detroit automotive cluster…
Geography matters
• How did it emerge?
• A story of growth and then (tragic) decline….
• What happened? Why?
• What can be done to revive Detroit’s place in the global
economy?
Detroit – ‘Motor city’
• Founded c.a. 1701
• French farming
settlement
• River for transport
• Rail from ~1830,
esp. after 1870s
Pre-motor city Detroit
0
400,000
800,000
1,200,000
1,600,000
2,000,000
Population in Detroit, Michigan, 1820-1950
(US Census Bureau)
Motor city
From Klepper S, 2007, “Disagreements, Spinoffs, and the Evolution of Detroit as
the Capital of the U.S. Automobile Industry” Management Science 53(4) 616-631
• Entry
• Firms make strategic decisions
Managers initially hire personnel with the same views
All managers receive different information, and it is noisy
• Decision-making based on all managers’ insights
• What if one manager has superior info and only (s)he knows it?
Motor city
• Disagreements occur within firms
Can lead to spin-offs
Most likely in ‘middle age’
• The more superior the information:
…the greater the N of spin-offs
…the better their performance
…the greater the loss the parent firm suffers
• Better firms generate more and better spin-offs
Motor city
• Spinoffs often locate close to the ‘parent’
• Success breeds success
• Agglomeration economies
• Detroit happened to have four of the most successful early
entrants (Old Motor Works, Cadillac, Ford, Buick)
• Even more successful firms in nearby towns (e.g. GM in Flint)
Motor city
From Klepper S, 2007, “Disagreements, Spinoffs, and the Evolution of Detroit as
the Capital of the U.S. Automobile Industry” Management Science 53(4) 616-631
Motor city
Motor city
Ryan, B D, Campo D,
2013 “Autopia’s End:
The Decline and Fall of
Detroit’s Automotive
Manufacturing Landscape” Journal of
Planning history 12(2)
95-132
Motor city
Ryan, B D, Campo D,
2013 “Autopia’s End:
The Decline and Fall of
Detroit’s Automotive
Manufacturing Landscape” Journal of
Planning history 12(2)
95-132
Motor city
Ryan, B D, Campo D,
2013 “Autopia’s End:
The Decline and Fall of
Detroit’s Automotive
Manufacturing Landscape” Journal of
Planning history 12(2)
95-132
• Oligopoly (2 or a few dominant firms in a market)
• Booming mono-economy
• Strong Migration inflows – became 4th largest US city at a point
• Especially of low / unskilled labor, especially African Americans
from the Southern states
• Issues of social and economic segregation
Motor city

1950s Detroit
1950s Detroit

What happened?
Automotive: shares
of production since
1950 – 2017
(Bureau of Transportation statistics)
What happened?
What happened? Population decline…
0
400,000
800,000
1,200,000
1,600,000
2,000,000
1820
1830
1840
1850
1860
1870
1880
1890
1900
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
Population in Detroit, Michigan, 1820-2010
(US Census Bureau)
• Population decline
• 1960s unrest
Vietnam war
Poverty & inequality
Racial segregation
• Riots
1967 Detroit rebellion
1968 Martin Luther King assassination riot in Detroit (also
elsewhere)
What happened?
• Continuing racial
segregation
What happened?
What happened?
• Not much better in smaller towns/cities around Detroit
• Issues continue to this day
• 2013 bankruptcy of the city (> 18 billion dollars) – now ‘solved’
• 30% of parcels are vacant, 30% of the buildings ‘blighted’ or in
need of demolition, 90% of publicly held parcels ‘blighted’
(Shetty S, 2015 “Detroit: Three Pathways to Revitalization, Book Review” Journal of Regional Science” 55(4) 676–677)
What happened?
• Not much better in smaller towns/cities around Detroit
• Issues continue to this day
• 2013 bankruptcy of the city (> 18 billion dollars) – now ‘solved’
• 30% of parcels are vacant, 30% of the buildings ‘blighted’ or in need
of demolition, 90% of publicly held parcels ‘blighted’
(Shetty S, 2015 “Detroit: Three Pathways to Revitalization, Book Review” Journal of Regional Science” 55(4) 676–677)
• Some disturbing images / language – Flint (a town near Detroit)
• Netflix: Flint Town (E01, 0:00-17:50)
What happened?
• Some disturbing images / language – Flint (a town near Detroit)
• Netflix: Flint Town documentary – see Canvas
What happened?
Revival?
• Really?
Revival

• Really?
• HBR article (There’s
No Formula for Fixing
Detroit, and That’s a
Good Thing)
• Almost purely
dependent on one
investor: Dan Gilbert
($5.6 billion, 17.000
employees)
Revival

What now?
What now?
Source: Peterson, 2019
“It used to be, cars were made in Flint and you couldn’t drink the water in Mexico. Now, the
cars are made in Mexico and you cannot drink the water in Flint. That’s not good”
September 2016, Flint
Revival: What about the government?
• What about the government?
Revival
• What about the government?
Revival
• What about the government?
Revival

• Public sector reform
Restructure – low population, thinly
spread… before even deeper issues
emerge
• Private sector developments, supported
by public sector
Incentivize good employees to come
& stay (and companies)
Creative solutions
Revival
• Focus on using two main resources:
vacant land and unskilled labor force
• Local currency, or even crypto
• Maybe not hopeless, but…
Revival
Autarky – “a country, state, or society which is economically
independent.”
(or sort of…)
• Really?
• Maybe, but risks of gentrification / displacement
• Continuing problems (unemployment, crime, poor public
services, urban decay etc)
• Not a mono-economy, but still dependent on just a few investors
• A manifestation of bigger (US) issues in the global economy?
• Understanding the ways in which globalization creates ‘winners
and losers’ in different places…
• Is the global economy really ‘flat’?
Revival
Today’s Seminar
Introduction, Group assignment recap
Geography and place matter
Detroit case study
Group Report and group discussions
Next steps
The report
• Any questions? E.g.
Where do we get data?
Is our Research question clear and focused?
How do we approach the literature review / theory?
• Please start working on the Report in your groups
• Time is passing quickly….
The report
• Crucial to craft the Introduction properly
Capacity to do independent research
…solve problems creatively
…work in a group
…write and sell a report (framing) -> introduction is key
Understanding != memorizing
The subject matter is useful / impactful (and interesting)
The report
Introduction
• Entice reader
• Communicate the ‘why’ and ‘how’
• The ‘what’ is in the RQ
• Don’t give it all away
Group assignment
Introduction: example framing
• Globalization has… changed something
• This is important, because…
• “What can these cities do to enhance their…”
“How can X, Y, Z be achieved?”
Competitiveness
Innovativeness
Quality of life
Tackle <an issue>
• How do these cities perform in <something> (more descriptive)
& what explains their performance?
Group assignment
Introduction
• An example: Raab J, Knoben J, Aufurth L, Kaashoek B, 2018,
“Going the Distance: The Effects of University-Secondary
School Collaboration on Student Migration” Papers in Regional
Science 97(4) 1131-149
Group assignment
Introduction
• An example: Raab J, Knoben J, Aufurth L, Kaashoek B, 2018,
“Going the Distance: The Effects of University-Secondary
School Collaboration on Student Migration” Papers in Regional
Science 97(4) 1131-149
Group assignment
Introduction
• Remember:
Answers needs to emerge from the theory & analyses
Research Question (RQ) determines which theories and
academic literature are useful
• Remember the GOLDEN THREAD to your NARRATIVE
Group assignment
• How is your research question developing?
• Is it focused and clear?
• What are the relevant theories and literature to review?
• What data do you need to provide evidence in the case study
chapters?
• Who is going to draft which section of the Report?
• Organising yourselves to deliver a quality submission?
• Any questions
The report: Group discussion
Questions?
Thanks for your time and see you next week…
Etieno Enang
[email protected]