Producer Services Trade in City Systems: Evidence from Chicago

Abstract

Recent efforts aimed at understanding the spatial supply and demand of business services have focused on their trade in regional and global settings. Noticeably absent from this research is a clear understanding of the organisation of trade within city systems. This paper demonstrates conceptually that trade flows through a two-tiered organisation of cities. The first involves 'world-class' cities, and the second a hierarchical organisation of cities within the US urban system. These patterns of interaction are analysed empirically using a recent survey of 263 business service establishments located in the Chicago metropolitan region. The survey enables identification of the spatial extent of both supply and demand for five business services. Spatial supply and demand distances are examined more closely via survivor functions. The results indicate that supply and demand distances vary markedly from industry to industry.