Affluent Cities and Digitalization: A Bidirectional Approach in 404 Cities

Affluent Cities and Digitalization: A Bidirectional Approach in 404 Cities

DOI: 10.4018/979-8-3693-0798-4.ch003
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Abstract

Urban development literature has gained great traction due to the unprecedent challenges that cities face, and digitalization has been signaled as a game-changer against these challenges. However, the effects that urban digitalization might have on the economic prosperity at city-level remain unexplored. This research analyzes the bidirectional relationship between the digitalization degree and the economic situation of a city, based on a sample of 404 cities. The analysis resulted in confirming the positive bidirectional relationship between digitalization levels and the city's economic condition. If the economic prosperity of a city increases, so does its level of digitalization and if cities embrace and integrate digitalization, there is a positive impact on their economic growth. Thus, economic development and technological advancement mutually reinforce each other in urban contexts. This study not only aims to nurture the urban literature, but also to shed light on the shift towards the cities of the future.
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Introduction

Cities are experimenting huge tensions due to the unprecedent population growth and its consequences in the urban contexts (Vardoulakis & Kinney, 2019). The urban population growth pushes cities to the limit (Marans, 2015) as it generally involves higher population concentration which might be translated into resources collapse and sustainability-related issues (Sodiq et al., 2019). Indeed, research highlights that these issues are likely to involve negative impacts on urban features such as the environment degradation, worse quality of life, or citizens or place health menaces (Gupta et al., 2019; Martínez-Bravo & Martínez-del-Río, 2019; Paiva-Vianna et al., 2015). For instance, population concentration in cities and the consequent economic activities are associated with air quality degradation which is highly related to health issues (Díaz et al., 2020; Di et al., 2017) because air pollution causes approximately seven million deaths per year and is responsible of one third of stroke, lung cancer, and heart disease related deaths (WHO, 2020). In this context, urban sustainability and city livability have been signaled as two of the grand societal challenges of the current century (e.g., Vardoulakis and Kinney, 2019). Governments aim to address those pressing issues through different strategies among which digitalization stands out because it has the potential of positively enhancing sustainability (Helbing, 2012, Heemsbergen, 2016, Seele & Lock, 2017) and importantly rising efficiency (Sodiq et al., 2019). Not only are policy and decision makers increasingly been interested in digitalization, but also a growing stream of research is advocating the digitalization of cities as the solution for the current urban challenges (e.g., Bibri & Krogstie, 2017).

Digitalization has the ability of changing peoples’ lifestyles and the way cities are governed (Seele & Lock, 2017) and has been associated with a myriad of benefits for urban contexts such as prosperity, effectiveness, and competitiveness (e.g., Ahvenniemi et al., 2017). First, scholars have outlined digitalization as a tool for optimizing urban planning and architectural design (Fertner et al., 2019) which might lead to better connectivity infrastructure and efficiency gains in terms of building management or resource use (Balogun et al., 2020). Second, research highlights that proper digitalization levels entail the possibility of gathering higher-quality data (Balogun et al., 2020) that could be afterwards used for governance purposes in terms of policy or decision-making. For example, Balogun et al. (2020) highlighted the possibility of using the data gathered thanks to digitalization for improving cities resiliency and diminishing their vulnerability against climate risks. Third, scholars also highlighted benefits for citizens because, thanks to effective digitalization, they might be offered greater possibilities of spatial and temporal conditions for engaging in urban activities (Lyons et al., 2018) because digitalization offers greater flexibility (Seele & Lock, 2017). For instance, they could take advantage of digital connectivity for socially and economically engage in society’s life (Alexander et al, 2011).

Key Terms in this Chapter

Urban Management: management of the physical, social, and cultural surroundings within a city, which considers the built environment, the social dynamics, the economic activities, and the overall lifestyle of dwellers.

Urban Digitalization: integration of advanced technology on urban contexts to enhance urban efficiency and minimize resources consumption.

Smart Cities: urban settings that function based on technology integration through intelligent management.

Sustainable Development: development that meets the needs of the present generations without compromising future generations to meet their own needs.

Affluent Cities: human wealthy settlements characterized by high population density, where diverse economic and social activities take place based on urban institutions and infrastructure.

Policy and Decision-making: formulation, evaluation, and implementation of courses of action by governments, resulting in leading to the achievement of specific goals, considering available information, resources, and objectives.

ICT (Information and Communication Technology): refers to the broad spectrum of technologies used for information handling, storage, retrieval, communication, and transmission. It encompasses computers, networks, software, and other digital tools.

Digitalization: incorporating digital technologies to transform analog or manual processes into digital formats, enabling efficient data storage, retrieval, and analysis.

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