HP Innovation Journal Issue 12: Summer 2019 | Page 17

AN URBAN BOOM
The Impact of Growing Cities on the Global Economy
DOUG WARNER
VP, Strategy & Innovation, HP
“Great cities are not static,
they constantly change and take
the world along with them.”
EDWARD GLAESER
Economist
Since the earliest humans began to shift from hunter-
gatherers to members of agrarian societies, cities have
been at the heart of mankind’s evolution and transfor-
mation. Early communities eventually became capable of
supporting large groups of people who were not farmers
and could live in close proximity. It was out of these gath-
erings of increasingly prosperous groups of people that
cities began to emerge and grow.
As economist Edward Glaeser put it, “Great cities are not
static, they constantly change and take the world along
with them.” According to our annual HP Megatrends
research, cities of all sizes across the developed and
emerging world will experience significant increases in
growth, opportunity and challenges, becoming centers
of ever-more-consolidated economic power. This will
especially be true in Asia. While the 19th century was
dominated economically by Europe, and the 20th century
by the U.S., economic trends point to Asia and its cities as
the key driving force for the 21st century.
A TALE OF ALL CITIES
In 1950, roughly 30% of the global population lived in urban
areas. Today, about half of the world’s population, or 4.25
billion people, live in roughly 400 urban areas. 1 By 2050,
urban areas are expected to account for almost 70% of
the global population. Cities across the world will feel the
impact of this massive migration. This includes what we
refer to as megacities, cities of 10 million people or more, as
well as large cities (5-10 million people), medium cities (1-5
million people), and small cities (less than 1 million people). 2
RAPID URBANIZATION
PUSHES INCOMES HIGHER
This rapid rise of city dwellers will pack a significant eco-
nomic punch. By 2035, there will be more than $20 trillion
in additional consumer income and associated spending
coming from urban populations across both developed
and emerging markets 3 . By 2030, the number of megaci-
ties is expected to more than double, from 20 to 49, and
the average household disposable income in megacities
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