Abstract:
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Growth of 'global cities' in the 1980s was supposed to have involved an occupational
polarisation, including growth of low paid service jobs. Though held to be untrue for
European cities, at the time, some such growth did emerge in London a decade later than first
reported for New York. The question is whether there was simply a delay before London
conformed to the global city model, or whether another distinct cause was at work in both
cases. This paper proposes that the critical factor in both cases was actually an upsurge of
immigration from poor countries providing an elastic supply of cheap labour. This
hypothesis and its counterpart based on growth in elite jobs are tested econometrically for
the British case with regional data spanning 1975-2008, finding some support for both
effects, but with immigration from poor countries as the crucial influence in late 1990s
London.
Keywords: regional labour markets; wages; employment; international migration; consumer
demand
JEL Codes: J21, J23, F22, R12 |