An agenda for the Federal Reserve’s review of its monetary policy framework


An agenda for the Federal Reserve’s review of its monetary policy framework


Global MetroMonitor 2012: Slowdown, Recovery, and Interdependence

While the global economic recovery slowed in 2012, the world’s largest metropolitan economies continued to have very different growth experiences. Disparities loom both across major world regions and within them, reflecting differences in metro industrial structure, national growth rates, and metro starting points.


An analysis of GDP per capita and employment changes from 2011 to 2012 for the largest 300 metropolitan economies worldwide, which account for nearly one-half (48 percent) of global output but contain only 19 percent of world population, shows that:


    • Three-quarters of the fastest-growing metropolitan economies in 2012 were located in developing Asia, Latin America, and the Middle East and Africa. By contrast, almost 90 percent of the slowest-growing metro economies were in Western Europe and North America. These recent trends reflect the accelerating shift of economic growth from developed metro areas in the global West towards developing metropolitan areas in the global South and East.


    • Compared to their countries, more than half of metro areas outperformed on employment growth in 2012, but only 40 percent achieved faster GDP per capita growth. Fifty-six (56) metro areas were pockets of growth in their countries, with both GDP per capita and employment expanding at a faster pace than national averages.


    • Almost three-quarters of the 300 metro areas had higher levels of employment and/or GDP per capita in 2012 than in 2007. Most metro areas in the developing Asia- Pacific and Latin America regions suffered no recession in the last five years or fully recovered to pre-recession levels, while only five North American metro areas managed to recover in both employment and GDP per capita. About 46 percent of metro areas, mostly in North America and Asia-Pacific, achieved higher employment and/or GDP per capita growth rates in 2011-12 than before the worldwide downturn.


    • Growth rates of both GDP per capita and employment slowed between 2011 and 2012 compared to the previous year for half of the 300 metro areas. Only in developed Asia- Pacific metro areas did combined GDP per capita growth accelerate last year, and among developed economies only North American metro areas achieved faster aggregate job growth in 2012 than in 2011.


    • Both national and local factors influence metropolitan economic growth. The previous year’s metro GDP per capita, the previous year’s national GDP per capita growth, and industry performance most affect annual changes in metro GDP per capita growth in the short-term. Over the long run (2000 to 2010), factors including national GDP per capita growth, initial metro GDP per capita, metro industry specialization, and metro human capital stock influence changes in a metro area’s standard of living.


Editor’s Note: To view a Metro Monitor that focuses specifically on American metro areas, see this page.