Urban entrepreneurialism 2.0? Financialization,cross-scale dynamics,and post-political governance

Since the term was first coined by Harvey (1989), urban entrepreneurialism has been a fertile ground for examining contemporary transformations in urban governance over the past three decades. Thoroughly engaging with innovations in public services, which is admittedly an insufficiently explored subject, at least in the field of human geography, Phelps and Miao’s (2020) article on varieties of urban entrepreneurialism is certainly a welcomed addition to the proliferating literature on urban entrepreneurialism. While usefully identifying different forms and geographies of innovation in public services, Phelps and Miao’s work has nonetheless overlooked several important aspects that (re)define contemporary urban entrepreneurialism. They have vaguely alluded to the rise of ‘urban entrepreneurialism 2.0’ in the sense of ‘hyper-entrepreneurialism’ or the intensification of entrepreneurial efforts and spatial outcomes (Wilson, 2017). Yet what defines urban entrepreneurialism 2.0 has not been duly attended. In this commentary, I would like to foreground three elements that I deem constitutive to urban entrepreneurialism 2.0, which are not adequately addressed in Phelps and Miao’s article—namely financialization, cross-scale dynamics, and neoliberal governmentality in the post-political world.

First, emerging as an evolving form of neoliberal capitalism that dominates in the postcrisis capitalist economies, financialization has swept across the globe and has brought about profound impacts on how cities are built and governed. In Phelps and Miao’s article, the brief discussion on financialization at the very end of the paper appears to be an afterthought rather than a serious engagement with one of the most important dynamics of urban transformation in the present day. The variegated processes of financialization, either as a means or an end, have undoubtedly redefined urban entrepreneurialism worldwide, in which the sheer volume of financial capital and innovative financial tools (e.g. Tax Increment Financing), enable local governments augmenting their entrepreneurial ambition to engage in bolder, yet riskier, entrepreneurial endeavors. I would argue that without building close linkages with these shifting financing strategies and modes of capital accumulation in the age of financialization, a good grasp of the rapidly changing field of urban entrepreneurialism would not be possible. To a large extent, financialization has overthrown conventional ways of city building and urban governance. Prevalent financial motives and practices have led to the production of new policy models and new norms of local governance. For instance, debt-machine dynamics is replacing growth-machine politics in certain US cities such as Detroit, where cities’ operating environment has been constitutively financialized (Peck and Whiteside, 2016). Meanwhile, the burgeoning state-led financialization in China supports a new state project aimed at tackling economic and legitimation crises in the realm of urban (re)development (He et al., 2020). Financialization also enables various forms of ‘innovation’ in entrepreneurial urban governance. Through securitization, real estate, infrastructure, land, and even stable rental returns are liquidized into securities and then melted into a mixture of various financial products to enable ‘city builders’, including public and private sectors as well as their partnership, to capitalize on their prospective yields from land and housing (Forrest and Hirayama, 2015). More importantly, new strategies and new forms of public–private partnership are enabled and sustained under financialization, which inexorably revamp the varieties of urban entrepreneurialism in the present day.

Second, as much as I found this article helpful in making a caveat of avoiding the territorial traps of methodological nationalism and cityism, I would love to see more and deeper engagement with the spatiality of urban entrepreneurialism at different scales. While the Phelps and Miao have suitably illustrated how urban entrepreneurialism goes beyond national boundaries in the case of China’s overseas investment under the Belt and Road Initiative, various trans-scalar and interscalar strategies are not explicitly scrutinized. Bountiful empirical cases of entrepreneurial urban projects at different scales can be found worldwide, ranging from Business Improvement Districts and Common Interest Development to free trade zones, mega projects, and new towns. Moreover, theoretical tools addressing the multiscalarity and interscalarity of urban entrepreneurialism, such as glurbanization, are also highly relevant here. The interscalar strategies of glurbanization bear witness to the collapse of global and local scales in cities, where the global and local come together in an interactive way in shaping the urban agenda (Matusitz, 2010). Going beyond methodological nationalism and cityism, concrete case studies of glurbanization from various contexts instantiate how entrepreneurial cities pursue place-based competitiveness through interscalar strategies to attract inward capital flows (e.g. Bercht, 2013; Jessop and Sum, 2000; Wetzstein, 2016). Moreover, the spatial scales that Phelps and Miao are dealing with, even though going beyond the local and national scale, are not interactive, if not static and singular, which leaves out the cross-scale and multidirectional dynamics of bottom-up and/or top-down policy processes. For instance, policy-making in China is typified by a circular process of central design, local experimentation, and then recentralized to the national level and recirculated or directly diffused from one locality to another on a national scale (He et al., 2018). Within these processes, the important roles of multilevel governments, financial institutions, entrepreneurs, and other stakeholders in shaping the multidirectionality (e.g. localization, universalization, mutation, and diffusion) of entrepreneurial urban policies should be brought to the fore to enable the theorization of pragmatic policy-making in different contexts and under various circumstances. In this connection, the discussion on ‘intrapreneurialism’ should also be situated in the multidirectionality and interscalarity of entrepreneurial urban policies, as the processes of institutional/policy innovation within local public sectors are not free of exogenous influence, which is in fact part of the mobility-mutation dynamics delineated in the policy mobility literature (Peck, 2011).

Thirdly, Phelps and Miao’s analyses seem to centralize on state sectors and the formal elements of urban governance, while neglecting other registers of governance, such as social life, identities, informal localized practices, including the governance of urbanism or urban governance 2.0 as defined by McCann (2017). Since the 1990s, urban governance studies have moved away from the emphasis on ‘governing urbanization’ employing political economy approaches to ‘governing urbanism’ applying the neo-Foucauldian notion of governmentality and the Rancierian conceptualization of the post-political (McCann, 2017). In the post-political age, the depoliticized, technicized, and instrumentalized urban policy-making processes are geared toward economic competitiveness, with the fundamental change being ‘a displacement from formal to informal techniques of government and the appearance of new actors on the scene of government (e.g. NGOs), that indicate fundamental transformations in statehood and a renewed relation between state and civil society actors’ (Lemke, 2002: 50). In other words, the renewed state/civil society/market relationships give rise to new institutional forms of ‘governance-beyond-the-state’, which rely, to a large extent, on the ‘conduct of conduct’ in Foucault’s terminology. Under this new norm of governance, private actors are granted a greater role in policy-making, while civil society is increasingly engaging in self-managing, together with the state actors, forming the horizontal, associational, and interactive networks among the three of them (Swyngedouw, 2007). With urban politics being depoliticized, the predominating role of governments are increasingly declining, to the extent that governmental organizations merely function as managerial-technological apparatuses for managing innovative business ecosystems and platforms (Swyngedouw, 2007). This signifies the rise of a neoliberal governmentality, which has replaced debates, disagreements, and dissensus that are inherent to urban politics. Notably, neoliberal doctrines and entrepreneurialism have penetrated into society to fabricate a new subject as entrepreneurial self, and precisely to coerce the subject to become enterprising, competitive, self-responsible individuals (Bröckling, 2015). In this regard, what is missing in Phelps and Miao’s (2020) article is not only a general account of post-political governance, but also more specifically the ‘innovation’ in the ways that citizens are governed (e.g. the introduction of a series of new techniques of neoliberal governmentality in the post-political age, including subjectification, technocratic management, creating consensus, and agreement).

Overall, while the authors have admitted that varieties of urban entrepreneurialism identified in the paper are not mutually exclusive, how these interrelated varieties spawn variegated entrepreneurial practices and outcomes in different spaces and times remain unattended. Hence the usefulness of this ‘varieties’ approach in dissecting the hybridity, internal contradiction, and variation of entrepreneurial governance of the city, as well as the vertical and horizontal, often intersected yet unequal relations of key stakeholders in the post-political era, is rather limited. In contrast, variegation is understood as a more explicitly relational conception of varieties, recognizing the strong and complex interdependencies, complementarities, and tensions among varieties (Jessop, 2014). To move from varieties of urban entrepreneurialism to variegated urban entrepreneurialism that enables dynamic and real-time analyses of the uneven development of entrepreneurial discourses, policies, and practices, a clearer understanding and a deeper excavation of the multiscalarity, multidirectionality, and the post-politicization (or de-politicization) of urban entrepreneurialism are necessary. In this regard, a whole array of analyses cross-cutting macro- (e.g. the volatile political and economic climate under financialization), meso- (e.g. institutional conjunctures of post-political politics), and micro- (e.g. the entrepreneurial self, the governing of urban life, and informal practices) scales, as well as the interstice and interlace among them, will contribute to more well-heeled studies on urban entrepreneurialism 2.0.