The Principal Characteristics of Activities Connected with the Knowledge Economy
Analysis of the distribution of economic activities in the metropolitan area,particularly in the manufacturing sector, shows the presence of a monocentric urban structure which has grown in a radio-centric manner, with a strong settlement
Fig. 1 Spatial distribution of manufacturing industries in Milan metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
thickening, especially along the radial axis in the northern part of the metropolitan area, where the main industrial district have been developed, and along the western ring-road (Fig. 1). The Brianza industrial district, particularly well-known for its furniture industries, has a multi-sectorial matrix and is characterized by the presence of both SMEs and a number of large companies. The latter form the more dynamic group, with a managerial form of organization, specializing predominantly in either product or market niches and engaged in external cooperation with advanced services, universities and research centres, with a view to developing innovative products.
The eastern part of the metropolitan area shows a more fragmented productive structure along the ring-road, with some important poles specialized in biotechnology industry, which are located quite close to the urban core. Although the biotechnology cluster is supported by a well-developed local healthcare infrastructure and is a promising local high-tech sector, its development is limited by the lack of coordination between universities and by the fragmented local networks of firms and organization.
While the ring-belt around the city accommodates several industrial settlements, the core of the Milan metropolitan area concentrates a system of firms specialized in advanced functions and concept-oriented high-level services. These assets are not only geographically concentrated but have developed close functional interactions. Inside the urban core, there is also a concentration of high-tech industries (Fig. 2), due in particular to the proximity to the codified knowledge provided by universities and related research centres. There is also a significant density of high-tech enterprises along the axis connecting Sesto San Giovanni, an area with a long history of major industrial activity, Monza, Desio and Seregno, along the western ring-road, and in the area of Vimercate, where a high-tech district has been formed. This brings together a number of companies operating in the fields of industrial electronics, information technology, telecommunications, energy and engineering, including some multinationals.
Analysis of activities with a high cognitive and creative content reveals the factors that most influence their choice of location and shows the main strengths and weaknesses of the way in which the territorial structure is currently organized.
In our analysis—as Cusinato has specified in this volume—we used a classification based on identification of advanced service activities expressly dedicated to the formulation of cognitive codes, referred to as Knowledge Creating Services (KCS). Taking the metropolitan area, we examined the distribution of KCS activities as a whole and as subdivided into the two categories of Core KCS and Core-Related KCS, and into specific activities, as well as the support services connected with them (Collateral KCS). We also considered in greater detail the location within the urban area of a number of advanced sectors belonging substantially to the creative economy field.
The representation, based on the territorial density of activities, confirms a high concentration of advanced services of high cognitive content in the metropolitan core (Fig. 3). Outside this core, the distribution of Core KCS + Core-Related KCS, and of particular specialized functions, tends to conform to the same pattern as for the location of manufacturing activities (Figs. 4, 5 and 6), with nuclei of greater density coinciding with the larger towns of the Brianza (Sesto San Giovanni, Monza, Lissone, Desio e Seregno), along the route to Como. A tendency towards polarization in the central urban area is also evident in the case of Collateral KCS (Fig. 7), of activities connected with public relations and communication,
Fig. 2 Spatial distribution of high and medium-high technology industries in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
publishing, advertising, film and television production, and of holding companies engaged in managerial functions, R&D activities and activities in the fashion and design segments (Figs. 8, 9 and 10). Where the fashion segment is concerned, Milan has consolidated its position as the centre for the whole region: in 2006, it accounted for 38 % of enterprises operating in the sector (Donzelli, 2007), in particular those belonging to the fashion design and styling segment, as well as for the segment's principal public and private training centres. In 2009, 12,000 fashion industry businesses were operating in the city, with 800 showrooms and around 6000 sales outlets (Jasson & Power, 2010).
Examining the distribution of these activities, we find a greater polarization in the location of law firms, chartered accountants' and the headquarters of holding companies in the central area, delimited by the inner ring-road of the Bastioni Spagnoli and characterized by a compact built environment of large blocks and historic buildings, while architectural firms and design and engineering studios are distributed almost uniformly throughout the central and semi-central areas (Figs. 11, 12 and 13).
From the inner circle, defined by the ring of the Navigli, to the next circle of the Bastioni Spagnoli—now a potent factor in the spatial structuring and economic and symbolic hierarchisation of the city (Bolocan Goldstein, 2009)—and out into some areas of the second belt, we also find a spread of services connected with fashion
Fig. 3 Spatial distribution of KCS (all services) in the city of Milan (2011). Source: Chamber of Commerce and Industry of Milan: Register of Active Companies (our data processing)
and design, activities associated with communication and the production of intangibles, and above all exhibition venues, which have been increasing due to a proliferation of temporary events, in particular fashion shows. As a result, significant groupings of showrooms and similar venues are to be found, not only in the central area, in particular the “fashion quadrilateral” (an area long abandoned by its inhabitants and now devoted to elite consumption), but also in the historic neighbourhood around Brera, in the Isola district and the areas adjacent to the Navigli, at Porta Genova (Via Savona and Via Tortona) and Porta Vittoria, and in the vicinity of the Romana railway station, an historic industrial and working-class suburb (Fig. 14).
These functional transformations of the built heritage are also affecting the city's
major historic establishments, such as the Frigoriferi Milanesi, and most of the old industrial buildings located in the central and semi-central areas. This is the urban environment most affected by the molecular transformation of the built heritage (conversion of attics and “lofts”, redevelopment of industrial premises for service/ managerial activities), a process which has been able to exploit the “porosity” of this environment, as well as the ineffectiveness of city-planning and other regulations. It has also suffered from colonization and contamination by stronger systems (especially those of finance and fashion), which have led to greater business dynamism and specialization in the area. Here, recent changes driven by the growing importance of intangible activities are to a large extent connected with
Fig. 4 Spatial distribution of KCS (all services) in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
alternatives to events held on the Trade Fair (Fiera) site (Salone del Mobile), Milan's main “showcase” for its wares, and we have seen an overlapping of the “Fuori Salone” phenomenon and the post-industrial redevelopment of the city.
As well as causing a steep rise in property values, with real estate now selling at monopoly prices, and periodically subjecting the city to excessive congestion due to the pull of its wide gravitational field, this intensification of fashion-and-designrelated activities has attracted large numbers of workers from outside the city.
Also on account of the cumulative dynamic of activities in its central area, Milan continues to be a major pole of attraction for flows of workers. Whereas, in 2006, 46 % of those working in Milan were commuters, over the last decade commuting has increased, partly because younger workers are coming in from the towns of the city's hinterland.
As well as the extreme congestion of the city centre caused by the excessive concentration of flows of workers (making longer or shorter journeys), this analysis shows that the semi-central areas (traditionally inhabited by the middle classes, and also the working class) are now under pressure from the more specialized businesses of the new urban economic base. It is therefore easy to understand how the stresses and strains of the property market, caused by sky-high prices and rigidity of supply, are among the main factors that have induced broad strata of the population, most of them young, to abandon the city, and have led to the
Fig. 5 Spatial distribution of core KCS in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
polarization of the present settlement pattern within the urban area, which manifests itself in the form of very segmented urban neighbourhoods (Ranci, 2005). This tensions have become even more acute in recent years, during which we have seen a concentration of real-estate investment in the central areas, especially those close to the city's higher quality urban renewal projects. Until the mid-2000s, the main thrusts of real-estate development tended to extend beyond the boundaries of the province, towards the hub of Malpensa and in the north-east of the metropolitan area, despite the inability of the transport network to adequately cope with the pressures. Since 2006, however, (according to Osmi Borsa Immobiliare) the market seems to be driven primarily by operations in the core of the urban region (especially within the circle of the Bastioni Spagnoli and in the Montecity-Rogoredo area, along the tram route to San Donato Milanese), in the prestige residential and executive housing sectors, sustained by the accessibility of the rail network, despite the vast amount of unleased housing stock (Gaeta, 2012).
While, on the one hand, the spatial organization and changes in the production system and settlement patterns of the metropolitan area have presented great opportunities, on the other they have caused seriously negative externalities and diseconomies of agglomeration, as well as profound territorial inequalities.
The spread of settlement, the relocation of industrial activities and the specialized production that historically has characterized the industrialization in
Fig. 6 Spatial distribution of core-related KCS in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
the Alto Milanese (area to the north of Milan, including Malpensa airport), where the principal productive industries have become established, has not resulted in a well-structured and autonomous polycentric system. The area to the north of Milan, subject to constant urbanization, has experienced a highly concentrated pattern of settlement, particularly dense along the principal (and increasingly clogged) transport arteries, which have attracted the large retail and entertainment structures. All this has brought about a considerable increase in population density, a very high level of land use (approaching 80 %) and high levels of congestion, which also extend to the secondary road network (Provincia di Milano-Centro Studi PIM, 2009). The demand for mobility in the metropolitan area has greatly increased, but public transport has become less and less competitive, particularly on secondary railway lines serving commuters. The situation is aggravated by the fact that the national and international east-west and north-south routes which need to bypass
Fig. 7 Spatial distribution of collateral services to KCS in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
the centre of Milan have no alternative but to use the city's ring-roads and railway network, which are already performing the tasks of providing both local and regional mobility. This has resulted in the saturation of the main access routes. In 2009, public transport accounted for around 45 % of journeys into the city centre, but only between 10 and 20 % of circular journeys between one outlying area and another.
While the pressure exerted on the central urban area by economic activities and flows of commuters has not diminished, neither has there been a reduction in the difference in income levels between this central core and the wider metropolitan area. The reversal of the trend of income levels begun in 1991 was also confirmed more recently (2005–2009): during this period the average income of city-dwellers grew significantly more than that of their counterparts living in the province of Milan, and even more so in the region (Percoco, 2009).
Despite these aspects of the labour market and productive structure that charac-
terize Milan's transition to a service economy, the change has not been accompanied by a corresponding increase in levels of education. Although the city is home to the principal centres of excellence where university education is concerned, in 2008 a relatively small proportion of the population of working age held a university degree (just over one quarter), which put Milan very low down in
Fig. 8 Spatial distribution of fashion and design activities in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
this respect in the ranking of European cities (Necchi & Mariani, 2009; OECD,
Furthermore, the driving financial and advanced services sectors do not seem to have had such a significant widespread impact on the urban employment market, from the point of view of professionalization. The urban employment structure—as Roberta Cucca has pointed out—is only weakly oriented towards professionalism: the very low percentage of highly-qualified people in management roles registered in the 2001 census (professionals and managers 8 %, medium skilled workers 46 %, clerks and service sector employees 12 %, low skilled workers 34 %) is not comparable with the situation existing in other European cities, even if it seems to be moderately increasing, according to the Excelsior system. The strong development trend of these sectors seems to have been to the advantage of a tiny group of high income earners, while other people involved appear stuck in medium qualified jobs, and this seems to have led to more inequalities in term of income distribution (D'Ovidio, 2009).
Fig. 9 Spatial distribution of advertising industries in Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
Taken together, the dynamics at work over the last 20 years have led to the dispersal of businesses and people within the metropolitan area and region, but at the same time to a concentration of service functions in the central urban area, replacing the resident population and gradually reducing the urban middle class (Ranci, 2005).
The decades-old social composition of the city, with a substantial working-class
population, the white-collar and technical classes produced by large-scale industry and public services, and a vast traditional middle class consisting of small businessmen, artisans and shopkeepers, has undergone a gradual contraction, particularly in its middle strata, and has been affected by social mobility, both upwards and downwards, a phenomenon that has been less and less regulated buy public policy (Bonomi, 2008).
Since 1973, when the number of people living in Milan reached a peak of more than 1,730,000, the city has continued to haemorrhage population, the number of inhabitants dropping to 1,256,000 by 2001. The demographic growth recorded between 2001 and 2010 (fewer than 100,000) can be ascribed mainly to foreign immigration. This is a fairly recent phenomenon, considering that the incidence of foreigners as a proportion of the total population increased from 9 % in 2000 to
16.4 % in 2010, according to data provided by the municipal authorities.
Fig. 10 Spatial distribution of business and management consultancy service sin Milan Metropolitan area (2011). Source: Chambers of Commerce and Industry of Milan and Monza-Brianza: Register of Active Companies (our data processing)
The processes that have taken place have been determined primarily by a marked structural change in the central area, as well as the selective mechanisms of the housing market. On the one hand, these processes have led to the formation of an urban region in many ways integrated in terms of its labour market and consumption patterns, and having a critical mass that has enabled it to attract private investment, services, the headquarters of multinationals and investment in fixed social capital, and to position itself among the principal European urban areas. On the other hand, these same processes have caused a large migration into the metropolitan area, growing levels of commuting into the central urban area, and thus very large flows of people who “invade” the city every day, with socially disruptive effects. All this is demonstrated by a copious literature which emphasizes how the dispersal and fragmentation of settlement patters, high levels of commuting and the inadequacy of the public transport infrastructure, have had negative effects for the stability of relationships and for the formation of social capital. The combination of these conditions in fact reduces the possibility of establishing stable connections, results in weak ties (Granovetter, 1973, 1983) and tends to widen the gap between work and private life.
Fig. 11 Spatial distribution of law firms in the city of Milan (2011). Source: Yellow Pages (our data processing)
-  The data used are those of InfoCamere relating to the Register of Active Enterprises owned by the Chambers of Commerce and Industry of Milan and Monza-Brianza. On the whole, in 2011, the manufacturing firms are about 40,000, while firms classified as KCS are more than 37,000
-  These are mainly small-scale enterprises with a distinctive family-style management model and little relationship with structures supporting innovative processes.
-  Assindustria Monza e Brianza-Nomisma, Brianza globale. I percorsi dello sviluppo, Research report, Monza 2000
-  Within the manufacturing sector, high-tech industries have been selected and considered separately, in accordance with the classification in common use
-  The high-tech district includes the “Green & High-Tech” technological centre
-  The classification adopted is that formulated by the SET Research Unit of IUAV University, Venice (cf. Compagnucci & Cusinato, 2011). For the database, we drew on various sources: the Milan Chamber of Commerce Companies Register (industries operating in 2011 classified by sector of activity on the basis of their main declared activity), the Yellow Pages, the Camera della Moda, Studiolabo, and universities' websites
-  Over 40 % of total mobility in Milan consists in movements in and out of the city, with around half of these journeys to and from the 39 municipalities of the first and second belts. Every day, some 850,000 people travel into Milan to work, study, access primary services and go shopping. For similar reasons, every day almost 270,000 residents travel out of the city. All told, the territory of the municipality of Milan has to cope with almost 5.3 million daily journeys (Comune di Milano-Agenzia Mobilita` Ambiente Territorio, 2013
-  R. Cucca, “Unequal development. Economic specialization and social inequalities in six European Cities”, Paper presented at the 23rd ENHR-European Network for Housing Research Conference, 5–8 July, Toulouse 2011