• Story Name: Economics of Cities
  • Story Topics: Economics,
  • Datafile Name: Cities
  • Methods: Cluster Analysis, Three Dimensional Plot,
  • Abstract:

    The data were collected by the Economic Research Department of the Union Bank of Switzerland. They represent the economic conditions in 48 cities around in world in 1991.

    The diagram for a complete linkage cluster analysis of the variables Work, Price, and Salary appears in Figure 1. On the basis of the cluster diagram, we consider dividing the cities into six groups. The blue group contains Western European cities. The green group contains all of the US and Canadian cities. The yellow group contains predominantly Scandavian and Swiss cities; however, Tokyo (marked with an 'x') also appears in this group. The orange group contains cities from the developing countries of Europe, Africa, and the Americas. The exception in this group is Seoul ('x'), which is an Asian city. The red group contains developing Asian, South and Central American cities. Finally, the purple group contains cities from small Asian nations such as Singapore, Taipei, and Hong Kong. The exceptions in this group are Tel Aviv ('x') and Caracas ('o').

    A plot of Salary vs. Price shows that the blue, green, and yellow groups cluster together at the high end of the Salary and Price scales, while the orange, red, and purple groups tend to have low salaries and prices. We might describe these two larger groups loosely as developed and developing cities.

    A three-dimensional plot shows that the yellow and blue groups have the fewest working hours, and the red and purple groups have the most working hours.

  • Images:
    City Cluster

    Cities Scatterplot

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