Under the context of Taipei developing as a world city, this paper uses World cities theory's framework to examine the evolution of Taipei metropolitan economic spatial structure. The results indicate that producer services (PS) sector grew rapidly and is becoming an essential sector in Taipei, while many manufacturing firms moving out of Taipei. The study also finds that a service network is formulated in the Metropolitan area, i.e. those firms located in the core area with international prospects are operating closely with those set up in the satellite towns with local service orientation. However, the development of PS sector is constrained by the insufficiency of space. This situation will be the obstacle in hurt the development of Taipei's world city functions. The spatial development policy should deal with this issue seriously.
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