Growth Without Urbanization
Last year, I poked around developing-country urbanization rates. The starting point is that in 2000-20, India grew from 28% urban to 35% urban. This is an anemic growth rate: it’s lower in absolute numbers than in the United States, which took not 20 years to grow at this rate but 10, from 1880 to 1890. And this is especially offensive in the context of a high-growth developing country – India has high economic growth, and by one measure in the 19 years before corona went from the GDP per capita the US had in 1847 to that the US had in 1899. In 19 years, it caught up with 52 years of US growth, but not quite 10 years of US urbanization. Why?
Is it unavoidable in developing countries?
No. Urbanization rates in East Asia were healthy during its period of catchup growth, which is still to a large extent happening in China. South Korea and China both took seven years to grow from 28% urban to 35%.
There’s been a lot of historical rewriting in the last 10 or so years, treating East Asia as always having been developed or at least having had the state capacity to grow, in contrast with laggards elsewhere in the world. This is often bundled with racism positing East Asians as a peer master race to white people, contrasted with Southeast Asia (for example, in Garett Jones), South Asia, and of course Africa. But in the last third of the 20th century, people commenting on East Asian growth did not distinguish East and Southeast Asia, and until the 1997 financial crisis, anti-communist autocracies Indonesia and the Philippines weren’t obviously different from South Korea and Taiwan; the divergence has been mostly in the last 25 years.
In urbanization, at any rate, Southeast Asia has been mostly showing rapid historic growth as well. Indonesia took the same 7 years as South Korea and China to grow from 28% to 35% urban, and its urbanization rate has grown from 42% to 57% since 2000. This is slower than China (36-61%), but in the context of weaker post-1997 growth, it’s moderate growth and moderate urbanization, rather than growth without urbanization as in India. Vietnam has fast growth and fast urbanization – 24-38% over the same period that India grew 28-35%, with similar per capita income trajectory as India. Thailand has exploded from 31% to 52% since 2000.
In Indian discourse, a growing comparison case is Bangladesh. It’s right nearby, it’s famous for being extremely poor, and in reality it’s barely any poorer than India. Moreover, it has the relatively unregulated labor-intensive manufacturing growth that Indian neoliberals wish India had, and less strict urban zoning restrictions. Well, Bangladesh has grown from 24% urban in 2000 to 39% last year, with exactly the same GDP per capita growth as India – 4.7%/year from 2000 to 2021 vs. 4.6% in India, albeit with India suffering a setback during corona and better-masked Bangladesh maintaining positive growth in 2020.
Is it unique to India?
Not exactly. The thread linked in the lede brings examples from all over Asia and Africa; Pakistan has even slower urbanization than India, albeit in a context of weak income growth. Africa is hard to compare with India because it has both low economic growth for how poor it is and slow urbanization, and its faster-growing states don’t necessarily urbanize fast, for example Sudan. The African country most discussed as a growth case in neoliberal English-language media, Ghana, has had a decent pace of urbanization – 44-58% since 2000 – but the accolades one sees to it must be viewed as drawing a target around where the arrow landed. To round up the English-speaking African states, Nigeria and Tanzania have had fairly healthy urbanization growth as well, but Kenya and Uganda have not.
So it’s not exactly just an Indian problem. But it’s a problem that does appear worse in India (and perhaps Pakistan) than in other developing countries, especially in contrast with India’s truly fast pace of income growth.
Why?
One answer is strict zoning. The density in Indian cities is very high (due to overcrowding), but it’s still lower than in the most direct comparison case, Dhaka.
But this is not a satisfying answer, and I worry that Indian urbanists overfocus on the maximum floor area ratio. Anup Malani, a Chicago law professor with economics background, tweeted a graphic summarizing the maximum floor area ratios (FARs)/floor space indices (FSIs) in various cities, showing how much Indian cities fall short. I picked this example because I saw it a week ago but it’s typical of Indian urbanist discourse to say something like “Mumbai permits a maximum FSI of about 4, New York permits 12.” But this is not quite accurate – Indian urban FSI limits tend to apply citywide, or at least in very large swaths of the city, whereas North American FARs apply at the level of the individual block; little of New York permits residential FAR 12, largely just the avenues and two-way streets on the Upper East and West Sides, and the vast majority of residential land permits FAR 1.5-3.
In this way, Indian zoning is more like traditional European zoning, which assumes high uniform density, with FARs of about 2.5-3.5 in the larger cities. It’s not quite the same because Parisian zoning prefers regulating height to regulating FAR, and Indian urban housing in the recently-built formal sector is much more likely to be tall-and-thin (as in, say, Vancouver) than mid-rise-and-thick as in Europe, but in terms of the pattern of density, India unwittingly tries to be Europe.
What’s true is that housing construction rates in India are lagging. A report by Knight Frank looked at new housing completions (“launches”) in the eight largest cities in 2018 and 2019. Relative to 2011 census population, in 2019, housing construction per 1,000 people reached 6.4 units in Mumbai, 8.9 in Pune, 4 in Bangalore, 1.4 in Delhi, 2 in Hyderabad, 1.6 in Chennai, 1.4 in Ahmedabad, and 1.3 in Kolkata. Maharashtra liberalized its zoning in the late 2010s, boosting Mumbai FSI from 1.33 to about 4, and this might be why Mumbai’s housing growth rate was not so bad (that is, it’s about comparable with that of Ile-de-France or Stockholm County and still lags Seoul and Tokyo), but elsewhere growth rates are extremely low. Government-funded housing heavily favors rural areas even more than their share of the population, but Mumbai rents are such that privately-funded housing should be viable at much higher rates than 80,000 units a year (in a city of 12.5 million).
Pedestrian Observations 
Many people view urbanization as bad thing. The countryside is pleasant and many want their own detached house, garden, and car. I live in midsized city because urban densities by high rise buildings results in street level crowding I don’t like. But, I recognize that suburban sprawl with increasing automobile use is really bad for the planet, as it destroys productive farmland and wildlife habitat. My view is that humans should generally be caged in the cities, but that 8 story building height limitation like we have in Girona, Spain provides best pedestrian street level density, with retail ground floor level, 1 story offices, and 5 or 6 stories of residential space.
Paris is dense but doesn’t have buildings taller than 8 stories.
Yes, Paris has pretty close to correct formula. There’s plenty within reach on foot, easy access to cheap transit, fair amount of trees and landscaping, and mostly wide sidewalks not utterly jammed with pedestrians. Paris could possibly reduce motor vehicle traffic more.
Paris absolutely has buildings taller than 8 stories. Setting aside La Defense, Tour Montparnasse, and the Tribunal there are 26 buildings in the city proper with *29* stories or more, all but one being residential or hotel. Google Les Olympiades, Front de Seine, and Italie 13. There are 7 in Ile de France suburbs (St Denis, etc.) and another 7 outside of La Defense in some form of development.
The height limit in the City of Paris is 37-50m in central areas (180m in outer areas), good for 10-14 stories. On top of that, for many years the legal height of a building iwas measured to the gutter, hence the of the mansard roof. A “7 story” building can have 2 (sometimes 3) floors in the mansard, and thus 9 stories tall.
It is true Paris does not have many skyscrapers compared to some cities, and that the CBD high rises are in La Defense not the traditional center. But it is fiction that the city is entirely low rise.
“countryside is pleasant” Not true in developing countries where there is bigger rural-urban divide in living standards.
Many think the problem is that countryside need to be improved, instead of moving people to where things are better
Yes, anti-developmental states like India like choking the productive economy through overregulation of big business and shoveling subsidies into the unproductive rural sector to keep it low-productivity. This is a serious drag on Indian economic growth and social development – for example, female labor force participation is actually falling (cf. Bangladesh, where it’s rising), because most production is not done at big firms that would hire anyone but rather at family-scale pop-beats-mom businesses.
Does India count as an anti-development state any more? The License Raj has been gone for over thirty years by this point.
If you are a rich person in a rural area you have a more pleasant life. In developed countries most people left in rural areas are fairly wealthy. You get electric, running water, internet, and all the other convinces of modern life, and no traffic means a car is a pleasant way to get around.
In developing countries things are more complex. You need some land and political stability to afford a tractor, but once you have one they are such a productivity boost that the owners start to buy land from everyone else, they move to the city for opportunity and a better life. However the people who remain still want a better life too and they now have the money to install better in. So I predict that we will see cities get better and better, then suddenly rural areas will improve to better, than the city will improve more over time until it is even (overall – depending on what you life one or the other will be better, cities will always have better live theater choices for example). Note that much of the above depends on a new generation and so it will take time. Adults only rarely find the time to improve their education enough to improve their lot in life. The rural areas make that big leap in large part because the educated farmers push everyone else out to the cities, which then need to solve the problems of the poor people who move in.
Cities do allow developing technology and better standards of living, but those mostly get exported to rural areas so it is a wash except for things that directly depend on large numbers of people.
Rural-Urban divide in living standards? This is mostly country mouse vs city mouse type of thing. To be honest, subsistence villages in Africa, that have almost no technology, have better lifestyle than places like Kinshasa or Nairobi.
Then why do people migrate from villages to Kinshasa and Nairobi, and not the reverse?
The city is exciting, sort of like a drug or something, for young people. City attracts because it consumes natural resources of all types. They do often return when fortunes in city are not good.
Young people are not the only ones leaving rural areas for Nairobi & Kinshasa. Increasingly older people are migrating to the cities where they can get better access healthcare not available in the villages.
Unless already sick, migrating for better healthcare is historically low on list of reasons to leave home village. But, depleting resources in village, often taken over by corporations, drives unemployment and need to find work in city. Europeans destroyed their forests and eliminated wildlife, then moved into cities.
The city offers the potential to escape poverty. The villages offer no potential to escape poverty.
I guess the potential to escape poverty is exciting and intoxicating in a sense, but describing it as a drug spewing dangerous faux pastoralist bullshit.
In addition to the points others raise, one major reason for migration to cities is that there’s not enough land for everyone to be a farmer when the population is rising rapidly. Meanwhile, technology means one farmer can farm more land.
This is completely false. Cities provide greater income opportunity, which means a higher standard of living. Cities provide electricity and running water better than villages, which impacts both productivity and health/sanitation. Cities provide more opportunity for education (subsistence villages do not host universities). Cities provide better access to healthcare, with aggregation leading to hospitals and surgery. These are all very concrete measures of improved lifestyle setting aside the entertainment factor, which shouldn’t be set aside because entertainment is a huge factor in lifestyle.
People do not return to the countryside when city fortunes turn for the worse, almost no country has ever seen its urban population drop, let a alone consistently drop (some small countries with a steady urbanization rate may see it fluctuate from say 30-27%).
Tell me, if subsistence living is so good, why do you live in a midsized city instead of a subsistence village?
Certainly in Britain lots of the rich all live in villages in Surrey or the Chilterns or the Cotswolds. But they still have access to good hospitals, schools, water, electricity and internet.
I mean when you hear an interview with a successful musician or whatever they all live in some fancy village in Oxfordshire.
I wouldn’t describe the Cotswolds as a subsistence village considering most residents do not make their livelihood out of subsistence farming.
I realize that what you say is conventional wisdom for cash economy. Subsistence farmers are increasingly lured by curiosity for consumer goods to join labor competition. Then, problem of unemployment and poverty becomes apparent.
I wouldn’t describe wanting basics like water, healthcare, education, etc. as “increasingly lured by curiosity for consumer goods”
“conventional wisdom for cash economy”
I actually mentioned almost nothing about cash economy and consumer goods, I mentioned education, healthcare, and access to infrastructure.
“Then, problem of unemployment and poverty becomes apparent.”
This is the classic mistake of relative vs absolute measure. Yes, if you work in the city you face the risk of losing your job and becoming unemployed and slipping into poverty, compared to those still working. But while subsistence farmers can’t become “unemployed”, they live in poverty *all of the time*. And what’s more, the poverty faced by a subsistence farmer is in many cases worse than the poverty faced by an under or unemployed person the city.
You still haven’t answered the question of why you are living in a midsized city, partaking of the cash economy and consumer goods like the computer and internet connection you are using to post this, if subsistence farmers have it so better. Advocating for others to not have access to the luxuries that you enjoy – for their supposed own good – is the worst form of hypocrisy and paternalism.
@Ernest Tufft, It’s easy to make such assumptions from far away, but the reality on ground in all developing countries is that the standard of living in rural areas is orders of magnitude lower than in the cities. One big area is access to doctors. Very easy to lose a life in a rural area for easily treatable minor ailments vs the cities where the access is much better despite even if it’s not sufficient there.
Also you can’t call a place higher standard of living if there are no jobs (subsistence farming can’t generate enough income to pay for basic services let alone modern ones). This is the biggest driver of the rural to urban migration in developing countries. Rural areas only have reasonable living standards in very wealthy countries, not in developing countries.
What do you mean “from far away”. My opinions are based on first hand observation in West Africa, DRC in Africa, and many other places around the world. The consumption of processed foods leads to greater tooth decay and other problems not present so much in subsistence farming.
Really? “All developing countries”? “Orders of magnitude lower”?
Do you think the situation in Malaysia or Mexico are the same as DRC or India? Do you really think “all developing countries” are the same? I don’t know if Ernest Tufft is making assumptions far away, but you definitely are.
Stupid white expats eat a steak every night in Bangkok and think most locals can afford the same; I’ve seen too many of this.
Not sure about Malaysia, but the poor people in Bangkok have it much better than the poor people in the rural parts of Thailand.
The (often illegal) immigrants coming in from Myanmar try to settle around Bangkok and not out in the sticks for a reason. They can suffer in the sticks at home.
City life isn’t guaranteed to be good, but subsistence farming life is guaranteed to be bad.
You are not comparing apples though. Substance life is better in the villages for the people who have land, but they are not making more. The kids who inherit land don’t move to the city, it is the kids who don’t get land that move to the city – their standard of living is lower than their brothers (I’m guessing sexism is in play in some form so brother is the right term, but this could be wrong), but it is still higher than it would be staying in the village.
And of course cities provide opportunities for kids not just adults. Sure you might do worse moving away, but the city will give your young kids a better life once they finish their education.
As I pointed out elsewhere, village life can improve to better than city life, but only if most of the people move away and so the farms get much bigger. This means decades of pain for a better future in 100 years. (only time will tell if that works out of course, but that is the current bet. Climate change and peak oil are two obvious strikes against it)
Taipei seemed perfectly walkable to me with taller buildings than this. New York, same thing – the problems at street level are not about building height but about poor trash collection (coming from cars and unwillingness to learn from Southern Europe, not density). And even with the trash collection problem in New York, people want to move to that city to the point of paying extremely high rents just because not enough housing is built, only around 2.5/1,000 people annually.
Wherever you want to put it, there is somebody already living or working there and they will be disinclined to stop doing either.
Yeah, same thing in Tokyo and Istanbul… somehow those cities build a lot more.
Hence densify existing development is necessary
They will be inclined to stop doing either and do it somewhere else if they are offered the right price. That is how a healthy city/economy/society works, someone offers to pay a premium for property to change its use, knowing that after they build something new they will have made some money for themselves and opportunity for others. At least is is historically how it worked. Its not as if they skyscrapers in lower Manhattan were built by the Dutch in the 1600s, yet somehow we accommodated the people “already living or working there” to make room for more.
Offering them the right price isn’t a formula for producing cheap housing.
An apartment is worth far more $ than a house even though rent on a house is much more money.
“Offering them the right price isn’t a formula for producing cheap housing.”
Buy a home worth $1M for $1.5M, spend $3M building 25 apartments on the lot, and sell them for $200,000 each. Despite offering the “right price” (which in this example is more than the worth alone) the housing is much cheaper, there is more of it, and the developer has still made money.
Price is a result of supply and demand; Econ 101. Places that build enough homes have reasonable housing costs (not necessarily “cheap” but affordable across many price points to the majority of the population without affecting standard of living). This has been seen time and again – New York did not have an affordability crisis until the 1961 zoning law introduced exclusive (vs. hierarchical) zoning and made it impossible to build mid-rise apartments across most of the city.
You aren’t going to build apartments that meet fire and building codes on a lot that small for that price.
“You aren’t going to build … for that price.”
My nice round numbers were illustrative, not descriptive. Build the 25 units for $17M, sell them for $800k each and you still have a profitable exercise with cheaper homes than what was there before.
The market for $800,000 apartments is a lot smaller.
In many cities, the market for $800k apartments is huge.
Where I live, Onux’s hypothetical is a real thing and one I’m going through right now (I’m currently negotiating it with a developer regarding the apartment I own). Most people in my area (urban Israel) live in 3-4 story apartment buildings, which are often somewhat old and decaying. Due to population growth and limited area for development, the current trend is to tear these down and replace them with taller buildings. Typically, a group of 3-4 story buildings will be replaced with 7-9 story buildings, and one of them replaced by a 30 story tower. The overall density of housing units on the site is approximately tripled. A parking garage is built underneath the whole development, and cars are banned from the surface, freeing up a lot of public land which is currently devoted to streets or parking (though some of this land goes to the larger footprints of the new buildings). Every current apartment owner receives a ~30% larger apartment in the new development, and the developer sells the new upper floor units and expects to make a profit overall, despite construction costs, and paying rent for all the current residents elsewhere while the site is demolished and rebuilt. It’s a win-win-win-win: current owners get a bigger and newer unit at no expense, developers make money, the city gains housing supply, there is more public space and less space devoted to cars.
You can build (semi detached) houses to a pretty high density. If you have a 25x10m plot, then you can fit a 9×11 house with a 1m passage down the side, a 9x10m back garden and a 5x10m front garden for car parking. Then you can have an 10m wide road with space for pedestrians.
A 9x11m house with 50cm wide walls for insulation and 25cm wide walls internally gives you about 70sqm of space per floor. So a three story home would be 210sqm which is pretty big frankly.
Then if after every 9 houses you have a cut through road to the parallel road, you have appropriate retail under some of the houses, and you save 20% of the overall space for schools and parks.
That gives you 2400 houses per square kilometre. So with 2.5 residents per house that would give you 6000 residents per square kilometre. Obviously London isn’t just residential and I’m ignoring larger commercial and industrial property as well as access roads and railways with my analogy, but London only has 5,666 residents per square kilometre.
Also you could make maybe 1/3 of the properties into 3 story blocks of apartments – which would end up being ~65sqm each and have some outdoor space. If each apartment has 1.5 residents that would lead to a total of ~7500 residents per square kilometre.
And yeah none of this is super high density, but you could build stuff like this in a village, or the edge of a city and people wouldn’t object.
“Buy a home worth $1M for $1.5M, spend $3M building 25 apartments on the lot, and sell them for $200,000 each.”
If the homeowner knows that the developer is going to be building 25 apartments that go for 200,000 each, why would they sell for 1.5M? They would probably hold out for something like 15M. That’s certainly what happens in Taipei, where city center rebuilds are incredibly difficult partially due to existing owners wanting a big slice of the pie.
> If the homeowner knows that the developer is going to be building 25 apartments that go for 200,000 each, why would they sell for 1.5M? They would probably hold out for something like 15M.
Because they want to sell. If it is just one homeowner, than this doesn’t work out, but a city implies several thousands of houses for the developer to sell from, and there is always somebody in that group who need to sell. The developer is really competing with the other buyers, why would anyone buy a house for 1.5M when there are apartment for $200,000 available is the real question. (of course there are lots of buyers, some would pay, but if the apartments are good enough many will not)
@John
“why would they sell for 1.5M?”
You could ask this question about any transaction (why doesn’t the seller maximize revenue from the buyer) and yet transactions happen all of the time, and not just in real estate. As Henry Miller noted if there are many homes for sale the one asking $15M will be passed over for the one willing to sell for less. It all comes back to supply and demand. Absent regulatory interference that restricts supply of lots to sell (zoning) or demand/ability of developers to build (building permit hurdles) price will roughly equalize where the curves cross. Where there is more demand/hotter market homeowners will get more, where there is the opposite they will get less.
What’s ideal is least density on street level with maximum comfort for pedestrians and cyclists, and affordable rail transit. New York definitely needs to close down motor vehicle lanes to make more space for trees, pedestrians, and bicycles. It’s not a pretty city. There is a lot to do there, but for myself I like to be able to bicycle 10 minutes out into rural area. NYC Central Park isn’t really very impressive. It’s too small.
NYC would be a very pretty city if it banned street parking, widened sidewalks, and actually cleaned up.
The nonsense that the typical person should be enjoying essential modern amenities in a (faux) rural environment is one of the most destructive ideas in the history of human civilization.
I agree with you actually. NYC could narrow lanes a little, put in speed reducing bumps, or some other system to slow motorist speed limit to about 25mph. I like cycling in rural rolling hills farmland and gravel bike mountain fire trails, so I just don’t like having to spent several hours to reach this rural environment. My main point is that suburbia of single family houses is just too inefficient to rescue farmland and wild land. If buildings are built against each other 8 stories tall with retail on ground floor, services are lot easier to maintain than 30 story tall buildings. This is why NYC is so sloppy.
Surburbia of small blocks of flats and semi-detached houses can still be pretty dense.
I think to most people a community made up of row houses and duplexes/triplexes isn’t really suburban, but urban (if not high density). A large part of the housing of DC, Montreal and San Francisco is flats or semi-detached on smaller lots, and no one suggests that those neighborhoods are suburban.
Most people like to eat. Having people in rural areas makes eating possible.
These houses are terraced, rural and fairly dense – https://www.onthemarket.com/details/12204651/#/photos/1
FARs/other building constraints don’t prevent *population* density, they only decrease the amount of personal space per resident.
City population density tracks job population density. If the cities are where the jobs are, the people will keep living there. And they don’t stop moving there–let alone having babies!–just because there’s nowhere to build; instead they start subdividing the apartments. So you get six people to a bedroom in a two-story building instead of two people to a bedroom in a six-story building.
If anything, reduced living space (relative to population density) increases the apparent street-level density. Places of public accommodation spill into the streets because of lack of space; vendors who can’t afford real storefronts sell out of push-carts or vans; commuter traffic from those who can’t find a place to live in the city increases; residents spend their time outside to escape their crowded living quarters.
Refusing to create space for people doesn’t make them go away.
“FARs/other building constraints don’t prevent *population* density, they only decrease the amount of personal space per resident.”
I think they also decrease population density. They discourage living near work, which encourages the building of sprawl to house people further from work.
The country side is pleasant in developed democracies with a very well maintained landscape. In other places life in rural areas is much more tough with poor infrastructure and housing. There is a difference between a well built suburb or a rural village transformed into a suburb for the middle classes and above and actual rural area where real peasants live.
Governments of Japan, South Korea, China, all believes they are facing excessive urbanization and want to slow or even reverse the trend, hoping that people live in and vitalize rural area instead.
And they have all failed. Under current technological conditions, urban living wins out. If you want less dominant mega-cities you have to invest in your 2nd-3rd tier cities. The battle for “regions”* was fought in the towns and villages and lost in the 2nd-4th tier cities. In Niigata, Tainan, Ulsan, Nanning and Harbin etc. Whether LDP, CCP, DPP or whatever-they-are-calling-themselves-this-week-Korean-party etc they all seek to promise the early high-growth years forever for the countryside. All deluded. If you want to preserve something economic and demographic vitality you need the local major city to be prosperous.
Its a pity, there are constraints on megacity livability, it takes decades to make places like as affordable as Tokyo (and Tokyo still hasn’t completed the process). Housing unaffordability really does damage to family and civic life. Better amenities and infrastructure oriented towards service sector workers (big and good universities being No.1) in the major regional cities might have worked but political power is oriented towards industries of the past the political networks behind them.
Nothing was sadder in my travels in regional Japan then all the stuff trying to convince themselves and everyone if they could just sell enough local produce to Tokyoites, it could fill the hole of not having a future their children wanted. Its probably too late now for most of these places in East Asia.
*I use the term regions because it is often confused with “rural” in these discussions. Often deliberately.
In Japan, population data indicate cities like Sendai can still attract population moving in from surrounding prefectures. It is just that the city itself is in the mean time losing its own people to Tokyo despite these inflows.
How does the undercounting of urbanization in India affect this? With visibly urban enclaves surrounding major metro areas refusing to be classified as urban and sticking to “rural” classification so they can keep their subsidies.
That they have subsidies for rural districts based on classification not income is itself evidence of something going very wrong….
I think there is much indicating that moderately slow urbanization is not at all bad for development, as compared to very fast urbanization in SSA or Latin America. I think China got this part quite right. Rapidly growing mega-cities such as Manilla, or the large SSA cities, are not particularly productive or conducive to industrialization or productivity (and are urban planning disasters). The very rapid growth of Indian cities from the 1970s to the 1990s was also not particularly successful.
Arguing that the Philipines had a similar development trajectory as the Asian tigers pre-1997 is also not very accurate. It is partly true for Indonesia, and perhaps Malaysia (or Thailand) is a better comparison (though Malaysia has much more well-regulated urban growth).
If anything China urbanized faster than Latin America?
Latin America as a continent is over 80% urbanized (and exceptionally high in some countries).
In China it is just over 60%, and the government has had an active policy to discourage growth in the largest cities.
That is how much urbanization, they have achieved not the rate of urbanization. Latin America urbanization started long ago.
The World Bank thinks the Philippines have been stuck at 46-48% urban for the last 30 years, so there’s none of the rapid urbanization of the US in 1870-1920, or the rapid catchup urbanization of 1960-1997 South Korea or 1979-present China.
Malaysia looked a lot like South Korea in the 1980s, yeah. But they’ve economically diverged, especially post-1997, and part of it comes from the fact that South Korea has favored large transit cities whereas Malaysia is the United States of Asia and the work trip modal split in Kuala Lumpur is 16%. (South Korea suppressed consumption to favor exports, Malaysia instead forced informal transit out of business to create an internal market for state-owned automakers.)
Just so I follow the logic I’m reading into the chain of events here:
1. Gov’t suppresses domestic consumption to favor exports
2. Favoring export industries means building for external consumption,
3. Building for external consumption brings in foreign capital
4. Foreign capital is used to further develop primarily exports;
5. Domestic consumption remains suppressed, causing a high savings rate
6. A domestic capital base with overseas investment controls means diverting private funds into public funds (i.e., bonds)
7. The existence of a steady source of public funds–in the absence of affordable private means of transportations (see 1)–means publicly provided transportation (i.e., transit) is pursued
Is this correct? Assuming so, is the order of events right? I know it’s a reading of how South Korea did it with their import substitution industrialization, but I’d like to straighten this out as a general principle because it bears quite a lot on how African nations develop their cities as they develop their economies, and of course on how much environmental destruction/climate change it all entails, assuming that they follow (as many seem to want) the development model of the Tiger economies.
There’s that old comment from Enrique Penalosa about advanced cities, rich people, and transit, but it seems important to flesh out an actual, material connection between transit and efficient economic development more broadly. I very much so want it to be the case, but of course that means making sure I’m not just being told what I want to hear.
While that appears to be the order, for some of those it is not clear that they caused the next vs they just happened that way. Even if it always works that way in our examples, that doesn’t mean it has to – and knowing how things have turned out can allow someone else to force a different result that it otherwise the easy one to fall into.
Thanks for the data here.
If humans were say… chickens. Would be not perhaps also be considering the quality of their habitation as well as the quantity -particularly density- just a little?
And as these “chickens” seem to proliferate and behave more like rats, would it not be equally important to discuss healthy (sustainable) limits to their populations. -also for their own health and well-being.
India’s total fertility rate is 2.1 aka replacement level.
In real life we have seen metropolitan region with ovee 35 million working normally without endangering its population, so if there exists a linit it must be higher than this number.
Any chance a graph showing 2000 and 2020 urbanization against GDP/capita? I think it would illustrate your discussion nicely.
Looking at the Asian countries Alon mentions (India, China, Pakistan, S. Korea, Indonesia, Bangladesh) it does appear that GDP per capita explains almost all of it, although with absolute GDP being more important than GDP growth that Alon keeps referring to:
https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=CN-IN-KR-BD-ID-PK&most_recent_value_desc=false
https://data.worldbank.org/indicator/SP.URB.TOTL.IN.ZS?locations=CN-IN-KR-BD-ID-PK&most_recent_value_desc=false
Despite what Alon says, Bangladesh isn’t “barely any poorer than India” it is actually richer now per capita. What’s more despite Alon suggesting Bangladesh had higher urbanization the entirety 2000-2020, its urbanization rate didn’t pass India’s until about the same time its GDP did – between 2012-2018.
In fact, Bangladesh’s urbanization rate passed India first, which suggests that urbanization drives higher GDP as much as the other way around.
The big outlier here isn’t India (whose GDP/cap and urban pop are about the same as Pakistan & Bangladesh) but Indonesia, which has a GDP/cap much closer to (but still noticeably higher than) the other 3 countries, but an urbanization approaching China. I wonder if this is a factor of being an island nation with limited land driving urbanization beyond what the economy would produce. Indonesia for instance had a higher urban pop than China from 1970-2010, despite a similar or smaller economy, and it has remained close to China despite GDP/cap diverging widely since then.
Graphs without S. Korea to illustrate the differences better.
https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=CN-IN-BD-ID-PK&most_recent_value_desc=false
https://data.worldbank.org/indicator/SP.URB.TOTL.IN.ZS?locations=CN-IN-BD-ID-PK&most_recent_value_desc=false
in PPP terms, Bangladesh is still poorer than India. At their current GDP growth rate, it’s like they overtake India soon.
You should always adjust GDP per capita for PPP terms. These are not small open economies – total exports plus imports are around 40% of India’s exchange rate GDP (Singapore: 300%), so the exchange-rate GDP is less relevant than PPP.
> Relative to 2011 census population, in 2019, housing construction per 1,000 people reached 6.4 units in Mumbai, 8.9 in Pune, 4 in Bangalore, 1.4 in Delhi, 2 in Hyderabad, 1.6 in Chennai, 1.4 in Ahmedabad, and 1.3 in Kolkata.
How much is it factor of supply restriction, and how much of it is the demand?
For contrast Britain which isn’t building anything like enough housing is built 2.4 homes per 1000 people in 2019 – and the south east of England built about 2.9 homes per 1000 people – the house building figures are from https://www.nhbc.co.uk/media-centre/statistics/2021/01/29/2020-new-home-statistics-review.
In order to build a sensible number of new homes we probably need to build ~5 per thousand people or something. And most of our existing housing stock is at least OK and is a lot better than shanty town housing.
Actually looking at the full PDF it like those figures are only the 70-80% of our total house building that has an NHBC warranty so we are building ~3.2 per thousand residents in the whole country and ~3.85 per thousand residents in the south east respectively.
Urban rents in India are high relative to incomes.
This is a ‘good’ thing right? Not that Indian policy is good, but if India (and similar countries) can manage to have similar income growth, without needing fast urbanization… then it is quite promising how much they could grow *with* fast urbanization, right?
Not really – the lack of jobs and housing in the cities is a real drag on economic and social development. India does other things right – for one, it’s huge, which provides scale (same as China or the US; the EU is trying hard to reproduce the same scale for a reason) – but this a big drawback.
Not sure why being large in size is a big drawback, as that if you look at it state by state and let each state do their own work then it would be of similar size as regular countries.
I think “this” was referring to “the lack of jobs and housing in the cities”, not to India being large.
It is important to note that India has usually tried to undercount the urban population. This is mostly by classifying many small/small-medium cities as rural areas. This allowed planners/govt to escape from the responsibility of providing urban style amenities to such communities. This also helped in fitting with the narrative that India is rural agricultural country (कृषीप्रधान देश). As such Indians have never completely accepted urbanism wholeheartedly. And tall skyscrapers are generally seen as an anathema. The only notable exception is Mumbai where due to space constraints and longstanding business/urbanist ethos skyscrapers are well regarded as is the ubiquity of terms such as FSI, 1/2/3 BHK, carpet area, built-up area, duplex, penthouse e.t.c.
If you exclude the erstwhile presidency cities like Delhi, Kolkata & Chennai, all other cities were until the 1980s pretty much small/medium size cities with an easy pace of life. It is only when population explosion exposed the inadequacy of the rural economy & the ensuing migrations brought upon the reality of dystopia to even to regional cities that the authorities have woken up. Of course Indians still have an uneasy relationship with urbanization.
It is perhaps better to provide better amenities/planning/transport to the several district/tehsil towns that lie within maybe 300-500 kms radii of the major cities such Mumbai, Bengaluru, Hyderabad, Chennai, Kolkata, Ahmedabad & Delhi among others. This will allow a significant part of industry & aspirational population to be accomodated in a relatively uncrowded environment. Innstead of bringing more and more people to urban/metropolitian locations we need to bring more sustainable & high quality urban features to our mofussil areas.
(Rescued from spamfilter)
The question is, what is bad or unsustainable about very large cities? It’s not pollution – the air pollution in India is mostly thermal inversion in the Gangetic Plain coming from general coal burning and from burning off crop stalks. It’s not crowding – with enough construction, cities sometimes have more space per capita than rural areas thanks to their greater wealth. It’s not that it’s somehow bad for development – East Asia has relied on very high levels of urbanization for its development.
The air cleared in Indian cities when everyone stayed home, early in the pandemic.
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7266738/
As far as I know, World Bank urbanization data are self-reported by the national governments themselves, and different countries have different definitions of urbanization. We may be comparing apples to oranges here.
Urban in Britain means over 10k. So a successfully growing large village would count as urban.
https://www.ons.gov.uk/methodology/geography/geographicalproducts/ruralurbanclassifications/2001ruralurbanclassification/ruralurbandefinitionenglandandwales
India does define urban population in way to minimize urban population. This was done so as to reduce the commitment of urban amenities. Of course now chicken have come home to roost and the new generation is looking forward to a more urban way of life be it in small towns & rural areas.