Abstract:The 21st century's economy is one of knowledge-based economy. The knowledge economy requires "creative cities". In the highly developed countries, knowledge has become a crucial factor in business and competition, between regions and cities. Greater investments will have to be made in the knowledge-based economy if we want to maintain current welfare levels. The knowledge development, in fact, underlies new products, services and processes (innovations) that end up constituting the engine of economic progress. No matter how global businesses or city regions compete with each other, highly-developed knowledge will be the key factor for success. Cities are the concentration places of human knowledge, creativeness and innovation, but not every city could become the creative city. Knowledge-based economy cities still hold the future. History tells us that cities are the places where knowledge, creativity and innovation reach full maturity, but not every city has unquestionably good prospects in the knowledge economy. In the end the cities to win the inter-city knowledge race are the "creative cities", which not only possess sufficient concentration, diversity and instability, but also project a matching image based on innovation and modernity. For the rest, the success of cities in the knowledge economy remains a question of human effort and happenstance. This does not mean that cities can simply rely on fate and adopt a passive attitude. In the current inter-city competitive race, it will be exactly the creative powers that a city needs to bring into play. This article analyses in particular what knowledge economy means for cities and explores what effect knowledge economy has on city development. It shows that cities are the places where knowledge, creativity and innovation flourish.
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