Formalization is the process of transformation from an informal to a formal economy. Given their vast reservoir of untapped informal assets, early 21st century cities particularly in the developing world, will be subject to intense waves of formalization in the Late Capitalist cycle of Globalization. European cities of the 17th - early 20th centuries have gone through a similar formalization process that transformed their economies and their urban structures. The process by which Europeans cities were transformed can generate guidelines for cities of the developing world undergoing the current transition. Through comparative analysis, this paper will investigate the parallels and differences between cities in both economic and cultural contexts, with the objective of outlining basic guidelines for approaching the plight of the contemporary city in the developing world.