The dilemma of “Twin Cities”: is the suburban dependence hypothesis applicable?

Abstract

The question of whether or not public investment and financial aid should be massively concentrated in a specified central city associated with a rising suburb has provoked a great deal of public controversy. The purpose here is to analyze the interaction between a central city and the surrounding suburban area based on employment and population, which is widely cited in “the Chicken and the Egg” problem. The results of our examination of Taipei City and its suburb reveal that Taipei-City’s employment as the engine of the metropolitan economy fully supports the suburban dependence hypothesis and hence the provision of more financial resources in Taipei City is beneficial to the overall metropolitan area, including its suburban area. However, our concern is that the recent policy decision regarding the appointment of Taipei County as another first-tier city, rather than merging it into a united metropolitan government, will further worsen the economic and political conflicts between “Twin Cities” and eventually reduce metropolitan competitiveness on the basis of New Regionalism.