When the “Competitive City” Fails: Milan’s New Urban Economy and the Turning Point in the Logic of Urban Competition

The sharpest product of the era of urban competition is a city that has learned to put on a performance of itself. It appears in rankings, in investment pitches, in conference and exhibition calendars, and in tourism promotional videos. Milan has played this role for years: Italy’s economic capital, one of Europe’s most globally connected cities, dense with innovation ecosystems, rich in symbolic capital, and with a fairly progressive policy agenda on issues such as sustainability and food systems.

The same city also offers another list: housing pressure, socio-spatial inequality, rising costs of living and doing business, and persistent environmental strain. An original research article published in Frontiers in Sociology on May 8, 2026 places these two lists within the same analytical framework—polycrisis. The authors, Cristiana Zara and Francesca Forno from the Department of Sociology and Social Research at the University of Trento, do not ask how severe the crisis is, but a harder question: when urban strategies centered on growth, competitiveness, and global attractiveness repeatedly expose their own limits, by what means do those urban economic actors who write social and ecological values into their charters continue to exist?

This is not a report about “what happened,” but a discussion about the political nature of adaptation. The study belongs to the journal’s special issue “Italian Cities in Transition: A Critical Assessment of Socio-Ecological Change,” and this scholarly context itself indicates that the issue is no longer a governance failure of a single city.

Crisis Is No Longer an Interlude but a Stage

The value of the concept of “polycrisis” lies in its refusal to treat economic fluctuations, social inequality, ecological pressures, and institutional fragmentation as independent malfunctions. They permeate and amplify one another. The study notes that growth-oriented urban strategies, even under the banner of “sustainability” or “innovation,” often still deepen socio-spatial exclusion and environmental pressure.

Milan thus becomes a highly contradictory case. It simultaneously accommodates an innovation ecosystem, symbolic capital, and policy ambition, as well as housing strain, rising costs, and ecological burden. This combination is becoming a common structure among top-tier global cities: the more successfully they are embedded in global networks of flows, the more easily tensions accumulate in local social relations. Lisbon, Berlin, Barcelona, and Amsterdam have all experienced similar structures in different ways; the difference lies only in the speed and intensity of political responses.

This also means that reading Milan’s predicament as an Italian-style governance failure is an overly convenient explanation. It is more like a side effect of success.

New Urban Economies: Not a Utopia, but a Way of SurvivalThe study turns its lens on a set of practices collectively referred to as “new urban economies” (New Urban Economies, NUEs): social cooperatives, mission-oriented enterprises, solidarity purchasing groups (GAS), and hybrid community spaces. What they share is an attempt to re-embed economic activity in social, ecological, and democratic value structures, resisting a logic in which extraction and profit are the sole measure. This is an echo of the Polanyian proposition of “embeddedness” in the contemporary city.

The study’s restraint lies in its refusal to romanticize such practices. The environment in which NUEs operate is hardly friendly: commercial rents are rising, labor is precarious, regulatory frameworks are fragmented, and dependence on digital platforms continues to deepen. Academic debate around them often oscillates between two extremes—either concluding that such alternative economies are destined to remain fragile and marginal, or asserting that they will eventually be co-opted and normalized by the mainstream market.

The phenomenon that truly needs explaining therefore becomes: in cities that structurally reward disembedding and punish embedding, how can a value-oriented economy sustain itself?

Adaptation Is Not Technical Adjustment, but Positional Negotiation

The study’s most significant theoretical move is to redefine “transformative adaptation” as a situated and inherently political process, rather than a technical or functional form of passive repair. Adaptation is no longer retreat, nor a mechanical response to shocks, but a process in which actors continuously negotiate their social-ecological commitments amid material, institutional, and market constraints. The study summarizes this as “strategic positioning” in the urban economy.

The analysis draws on Fedele et al.’s (2019) tripartite distinction: coping, incremental, and transformative adaptation. But it refuses to read these three as a ladder. Empirical evidence shows that adaptation is closer to an overlapping, mutually mixed continuum: the same organization uses multiple adaptation logics simultaneously in different sectors and at different stages, rather than moving along a preset path from “coping” to “transformation.”

The implications of this judgment extend beyond Milan. Over the past decade or more, climate policy and innovation policy have grown accustomed to “transformation” as a keyword, assuming a path that can be designed, financed, and measured. The Milan experience suggests that real adaptation takes place in a gray middle ground: compromise, adjustment, partial persistence, and localized breakthroughs occur simultaneously. If policy funds only “transformative” models, it will systematically overlook the sedimented layers that actually carry the production of resilience. Given the policy expectations attached to “transformative adaptation” after the IPCC Sixth Assessment Report, this reminder is not academic nitpicking.

The City’s Power Comes from Tools, Not Narratives

Raising the perspective from organizations to governance, the Milan case immediately raises a harder question: does the city possess enough tools to keep adaptation from degenerating into long-term depletion?Research finds that NUEs’ adaptation strategies are shaped differentially by sectoral conditions, institutional environments, and organizational trajectories. This suggests that the most basic tools at a city’s disposal—land and space, public procurement, rent and use regulation, social infrastructure, and municipal-community cooperation agreements—are often more decisive than grand narratives. Barcelona imposed restrictions on short-term tourist rentals; Amsterdam used the “Doughnut” framework to reconstruct the value logic of municipal budgets; Vienna has long maintained a tradition of social housing. Their paths differ, but what they share is that they wrote value commitments into tools rather than leaving them in declarations.

Conversely, when a city has only narratives and lacks tools, the new urban economy easily slides into a kind of social buffer: it absorbs some pressure, yet can hardly touch the structures that produce that pressure. This is precisely the core contradiction of urban governance under polycrisis—cities’ political visibility is rising, while their actual jurisdiction is continuously squeezed by national frameworks, global capital flows, and platform infrastructure.

Same Diagnosis, Two Intensities

This study is situated in European cities, but its diagnostic tools are cross-border applicable; only their intensity is unevenly distributed.

This also changes the understanding of cities’ international role. Over the past two decades, cities have been encouraged to present themselves as “global actors”: joining climate alliances, signing mayors’ covenants, building transnational networks. These efforts expanded cities’ diplomatic space, but they have always been constrained by a fact—cities’ commitments often lack matching fiscal and regulatory authority. Polycrisis exposes this gap more thoroughly: cities are forced to bear the consequences while lacking the means to address the causes.

In most Global South cities, solidarity economies, informal collaboration, and mutual-aid production are not niche alternatives but the default mode of operation of the urban economy. There, adaptation is not a choice but the norm. This reminds us that “re-embedding” is not an intellectual luxury of Northern cities, but a structural response generated broadly by urban societies after the retreat of the developmental state and amid high volatility of global capital.

Therefore, what can be exported from the Milan experience is not a model but a question: what kind of institutional scaffolding does a value-oriented urban economy need so that it is not merely a patch? This question is only more urgent in Lagos, Nairobi, Jakarta, or São Paulo.

Boundaries, Historical Arc, and a Long-Term Judgment

Caution is needed. This is a qualitative study of a single city: geocoding of 87 new urban economy initiatives, plus 25 in-depth interviews. “New urban economy” itself is a constructed analytical category, and its boundaries are not clear; Milan’s socioeconomic structure, policy traditions, and density of civil society are not replicable everywhere. Its conclusions are better treated as a hypothesis with explanatory power than as a universal law.Even so, this study still points toward a longer historical arc. The twentieth-century city was a container for state welfare; the “competitive city” at the beginning of the twenty-first century was a container for capital; and the city in the age of multiple crises is becoming a place where both containers leak at once. What grows from the cracks is not a new set of models but a new grammar: adaptability, provisionality, continuous negotiation. It is weaker than ideology, yet more real than grand narratives.

The question that will truly determine the fate of cities in the next decade may be this: Can municipal institutions turn this grammar into tools? Or will the new urban economy long occupy the position of a social cost, paying, for an old model that has not yet been replaced, a bill it is itself unwilling to acknowledge?

Milan merely brings the outline of this question into clearer relief than elsewhere.