Home > Views & Papers > Zhu Dajian: How to Integrate Sustainable Consumption into International Consumption Center City Construction?

Zhu Dajian: How to Integrate Sustainable Consumption into International Consumption Center City Construction?

Wed, May 24, 2023

“Consumption” has undoubtedly become a hot topic in recent years, from the national to local levels, as its role in fostering economic growth has become more and more apparent.

The majority of resident consumption occurs in cities. Consumption has currently emerged as one of the important themes for future economic growth in many cities. Shanghai, Beijing, Guangzhou, Tianjin and Chongqing were given the go-ahead by the State Council in July 2021 to develop and build international consumption center cities. Over the past 18 months, the building has been in full swing, further releasing cities’ potential for spending and turning into a gauge for directing consumption development.

In addition to its fundamental role in economic development, consumption also has social and ecological benefits, thus it should also be a noteworthy topic to discuss how sustainable urban consumption is in the development process.

Consumption and urban development

Regarding the international consumption center city, which is an advanced form of domestic consumption market upgrading, Professor Zhu provided an interpretation of the transition from consumer cities, consumption center cities to international consumption center cities.

In 2001, Edward Glaeser, an urban economist at Harvard University, published the paper Consumer City, which studied urban economic growth from the perspective of consumption and proposed that the growth of cities would increasingly rely on their function as consumption centers. According to Professor Zhu, “consumer cities”, compared to international consumption center cities, is a concept that is well-known and largely accepted worldwide. Professor Zhu claimed that the transformation from production-oriented cities to consumption-oriented cities is a shift in economy from “manufacturing” to “consumption”, which means that cities will turn into locations that satiate people’s aspirations for a better quality of life. “In the long-term development process, production-oriented cities only exist at specific stages and will eventually transform into consumer cities. In the new stage of China’s building of a modern socialist country, improving people’s quality of life primarily manifests as increasing their consumption. For urban development, it is necessary to increase the proportion of consumption in the urban economy.”

Professor Zhu provided more details by taking the development and transformation of Chinese cities like Shanghai as an example. In the early days after liberation, China’s policy for building the new Shanghai was to transform it from a “consumer city” to a “producer city”; China proposed to increase the proportion of industry in urban development in order to replace the old Shanghai, where Chinese people were exploited by imperialist compradors and bureaucrats, with a new Shanghai where Chinese people were served by domestic production. However, with the reform and opening-up, China has essentially completed urban industrialization, and it will shift from “Made in China” to “Consumed in China” in the next 30 years.

The second leap in urban development, in Professor Zhu’s opinion, is the shift from consumer cities to consumption center cities, if the shift from production-oriented cities to consumption-oriented cities is the first leap. Zhu said that a consumer city is a concept specific to a city, whereas a consumption center city, or a city that holds the consumption center position within the surrounding cluster of cities, is relative to a city cluster. “Each of the five city clusters in the Yangtze River Delta, the Guangdong-Hong Kong-Macao Greater Bay Area, the Chengdu-Chongqing region, the Beijing-Tianjin-Hebei region and the middle reaches of the Yangtze River should have a central consumer city, and the criterion for such a city is the proportion of its consumption in the surrounding cluster of cities.”

Professor Zhu explained the international consumption center cities as gathering places that incorporate resources for global consumption and exhibit the degree of agglomeration of international brands or globally first-launched goods and services in cities. In his opinion, the shift from consumption center cities to international consumption center cities is the third leap in urban consumption development, and typical international consumption center cities include New York, London, Tokyo and Paris.

Regarding the differences between international consumption center cities and global cities (or world cities), Professor Zhu noted that for global cities, we focus on such productive services as financial and legal services that are centrally provided in central business districts (CBDs), while for international consumption center cities, we focus on globally first-launched products and services that are centrally provided in international business districts such as Oxford Street in the UK, Fifth Avenue in the U.S., Ginza in Tokyo, Champs-Élysées in Paris, Wangfujing in Beijing and Nanjing Road in Shanghai.

Sustainable consumption and international consumption center cities

Professor Zhu stated openly that the topic of how to associate sustainable consumption with the development and construction of international consumption center cities is one that is somewhat ahead of its time, and three prerequisites need to be satisfied in order to integrate sustainable consumption into the development of international consumption center cities.

Firstly, urban consumer groups should be organized in an olive-shaped pattern, with the middle class acting as the main force of urban consumption and the proportions of the rich and the poor declining. In Professor Zhu’s opinion, neither the rich nor the poor can support sustainable consumption. “The poor do not make enough money to maintain a comfortable and sustainable middle consumption level, and they prefer disposable items because such items can save money. The rich, on the other hand, might engage in widespread overconsumption. Therefore, sustainable consumption is often associated with the middle class.” Professor Zhu emphasized that a powerful middle-class population is required for sustainable consumption to become commonplace in a city.

Secondly, mass consumption in cities should follow a lifecycle, and waste sorting and zero-waste city development should be the first step. Professor Zhu contended that sustainable consumption is impossible in cities that struggle with waste sorting or where the amount of waste grows. Urban consumption can be made to change toward sustainability by using zero-waste city development as the starter. In order to promote sustainable consumption, Professor Zhu underlined that it’s vital to incorporate sustainability into the sources of production and consumption, and establish sound incentive mechanisms because “to steer sustainable consumption solely by morals is quite difficult”.

Thirdly, urban consumption needs to be upgraded. In Professor Zhu’s opinion, sustainable consumption is a kind of upgraded consumption, and one of the important conditions for achieving such upgrading is that people’s initial consumption needs have been met. “If the initial consumption to meet basic needs has not been realized, people’s consumption is probably of the quantity expansion type.” Taking automobile consumption as an example, Professor Zhu explained that it is likely that consumers will choose an electric vehicle for their next purchase if their first car was a gasoline-powered model. He mentioned that guiding consumption is easier during the upgrading phase.

Guiding sustainable consumption through commodities, stores and business districts

Regarding how to take concrete action to integrate sustainable development into urban consumption development, Professor Zhu held that active guidance from the three dimensions of commodities, stores and business districts is very important.

In his opinion, a small number of products or brands focused on sustainable development are available in some international or domestic stores. If the range of sustainable products steadily expands, or even achieving the United Nations’ Sustainable Development Goal 12 (SDG 12) – “Ensure sustainable consumption and production patterns” is a requirement for products to be allowed access into a store or supermarket, there will be a transition from qualitative to quantitative change, or from changes in individual commodities to changes in entire stores. According to Professor Zhu, the next evolution will take place on a much wider scale, and will involve the sustainable transformation of business districts, which serve as the primary hubs for urban consumption. A business district can be deemed to have sustainable consumption attributes if an alliance for sustainable consumption is established among the stores or malls within the consumption space of an international consumption center city, and it promotes or mandates that commercial activities, such as the buying and selling of goods in a business district, adhere to sustainable development principles.

Professor Zhu stated that the promotion of sustainable consumption through commodities, stores and business districts is a relatively cutting-edge topic, and currently there are very few merchants or business districts that have successfully accomplished this goal, both domestically and internationally. In his opinion, growing amounts of pilot, exploratory, and demonstrative work may be done to integrate sustainable consumption into international consumption center cities; such work can start with commodities (e.g. developing a sustainable consumption agreement within the coffee industry); stores (e.g. encouraging fashion stores to consider lifecycle sustainability when making purchases), or commercial streets or business districts (e.g. promoting the sustainable transformation of consumption from the perspective of consumption space).


X Thank you for your interest in Master of Global Management, Tongji University!