Sheikh Mansour has bankrolled an unprecedented spending spree at Eastlands as the Blues look to shift the power balance of European football.

While the massive investment may have seen City post record losses of £121.3million, it appears to be paying off on the pitch as Mancini's men currently just two points behind leaders Chelsea, three ahead of Arsenal.

Wenger has long championed the development of youth, preferring to mould a world-class talent like captain Cesc Fabregas rather than simply just going out and buying it.

The Arsenal manager accepts each philosophy has its own obstacles.

"I am happy where I am and I work in the way I work," said Wenger.

"I could do it [spend millions] as well, but Mancini has his own problems and I have my problems.

"I am quite happy with my problems, because I have enough.

"It is a different way - we have advantages as well to clubs who have less resources than us, Coventry to Arsenal is less resources, so we have to accept that."

Wenger continued: "City now will be one of the contenders because they are not at the end of an investment cycle, it looks like they are at the start of it, so you have to consider them as one of the teams that will challenge.

"In our own way, we are at the start of a cycle. That's what is good in football. Every club can work with his own rules."

City were understood to have been keen on landing Wayne Rooney from rivals Manchester United, before the supposed disillusioned England striker performed a sensational U-turn by agreeing a new, five-year deal at Old Trafford.

Observing the saga from afar, Wenger had felt Rooney would have been sold.

"I did never hear that Wayne Rooney wanted to leave, I just heard he didn't want to extend the contract. It is Man United who said he wanted to leave, so it is not completely the same," the Arsenal manager reflected.

"I think the initiative came from Man United, and its not difficult to think why."

Wenger won his own battle to keep Fabregas at Emirates Stadium in the summer, fending off Barcelona's £35million bid for their former trainee.

The Arsenal manager feels the current contract system is somewhat fragile.

"The rules are inflationary because you are in a position where you always have to extend the contracts of the players if you want to keep their value," he said.

"For me, the value of the player should be independent of the length of the contract.

"He should have a commercial right and a contract right. The two should be separated and not placed on the same level. Inflation in our sport is created because the two are linked together.

"If you do not want to lose the commercial right you always have to change the contract of a player and it's always for more - that creates a massive inflation.

"At some stage when the resources cannot be increased any more you will have a financial problem."

Wenger reflected: "If you look at the society and the measures the government has taken, it's all cut, cut, cut, and our sport is always going up. How far can that go? Nobody knows."

Arsenal hold an enviable solid financial footing through their self-funding model following the move to the 60,000-seater Emirates Stadium.

Wenger believes that can put clubs in a position of strength.

"A well managed cub is one that can say no. City are in that position as well, for different reasons to us," he said.

"A club that can say 'you want to give us how much?' We say 'no' because we are not in need of money."

Arsenal look set to come up against former striker Emmanuel Adebayor on Sunday.

Adebayor made the headlines for the wrong reasons last season, both for his over-the-top goal celebration in the 4-2 victory and then stamping on Robin van Persie's face, which earned him a three-match ban.

Wenger, however, insists there was no sense of ill-feeling toward the former Arsenal favourite, sold for £25million during the summer of 2009.

"Frankly, we never spoke about that," Wenger said.

"We are all focussed on putting in a good performance on Sunday. "We have played so many games since that we don't even care about that now."