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Urbanization without growth : a not-so-uncommon phenomenon

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  • Fay, Marianne
  • Opal, Charlotte

Abstract

To find out why African countries'experience with urbanization and sustained growth appeared to differ from that of other countries, the authors investigated the determinants of urbanization across countries over 40 years. Rather than studying individuals'decisions to migrate, they relied on macroeconomic data and cross-country comparisons. A central hypothesis of their study: that individuals move (with varying degrees of ease) in response to economic incentives and opportunities. If location incentives are distorted, so is growth. The authors find that urbanization levels are closely correlated with levels of income. But urbanization continues even during periods of negative growth, carried by its own momentum, largely a function of the level of urbanization. From that viewpoint, Africa's urbanization without growth is not a puzzle. Factors other than income that help predict differences in levels of urbanization across countries include: a) income structure; b) education; c) rural-urban wage differentials; d) ethnic tensions; and e) civil disturbances. In addition, the relationship between economic incentives and urbanization is weaker in countries with fewer civil or political liberties. Factors other than initial urbanization level that help explain the speed of urbanization include: 1) The sector from which income growth is derived; 2) ethnic tensions; 3) civil disturbances and democracy (these two slow the pace of urbanization if all else is constant); 4) rural-urban wage differentials, whether they represent an urban bias or simply lower productivity in agriculture relative to other sectors. The weak relationship that this study shows between urbanization and traditionally accepted migration factors suggests that in Africa economists are overlooking part of the urbanization story. The fact that the informal sector appears to provide a significant source of income for urban migrants, coupled with the overlap between rural and urban activities, may shed light on the nature of urbanization in Africa.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2412.

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Date of creation: 31 Aug 2000
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Handle: RePEc:wbk:wbrwps:2412

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Related research

Keywords: Banks&Banking Reform; National Urban Development Policies&Strategies; Urban Housing and Land Settlements; Public Health Promotion; Urban Services to the Poor; Urban Housing and Land Settlements; National Urban Development Policies&Strategies; Governance Indicators; Banks&Banking Reform; Urban Services to the Poor;

References

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  1. Mazumdar, Dipak, 1987. "Rural-urban migration in developing countries," Handbook of Regional and Urban Economics, in: E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 2, chapter 28, pages 1097-1128 Elsevier.
  2. Easterly, William & Levine, Ross, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1203-50, November.
  3. Easterly, William, 1999. " Life during Growth," Journal of Economic Growth, Springer, vol. 4(3), pages 239-76, September.
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Citations

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Cited by:
  1. Kenny, Charles, 2005. "Why Are We Worried About Income? Nearly Everything that Matters is Converging," World Development, Elsevier, vol. 33(1), pages 1-19, January.
  2. Sumon Majumdar & Anandi Mani & Sharun W. Mukand, 2004. "Politics, Information and the Urban Bias," Discussion Papers Series, Department of Economics, Tufts University 0409, Department of Economics, Tufts University.
  3. Nguyen Viet Cuong, 2014. "Does Urbanization Help Poverty Reduction in Rural Areas? Evidence from a Developing Country," Working Papers 2014-178, Department of Research, Ipag Business School.
  4. World Bank, 2009. "Mozambique - Municipal Development in Mozambique : Lessons from the First Decade - Full report," World Bank Other Operational Studies 3102, The World Bank.
  5. Storeygard, Adam, 2013. "Farther on down the road : transport costs, trade and urban growth in Sub-Saharan Africa," Policy Research Working Paper Series 6444, The World Bank.
  6. Gilles Duranton, 2007. "From cities to productivity and growth in developing countries," Working Papers tecipa-306, University of Toronto, Department of Economics.
  7. Satterthwaite, David, 2010. "Urban Myths and the Mis-use of Data that Underpin them," Working Paper Series UNU-WIDER Working Paper W, World Institute for Development Economic Research (UNU-WIDER).
  8. Jo Beall & Sean Fox, 2011. "PD4: mitigating conflict and violence in Africa’s rapidly growing cities," LSE Research Online Documents on Economics 41855, London School of Economics and Political Science, LSE Library.
  9. Henderson, J. Vernon & Roberts, Mark & Storeygard, Adam, 2013. "Is urbanization in Sub-Saharan Africa different ?," Policy Research Working Paper Series 6481, The World Bank.
  10. Quigley, John M., 2008. "Urbanization, Agglomeration, and Economic Development," Berkeley Program on Housing and Urban Policy, Working Paper Series qt6tf2s100, Berkeley Program on Housing and Urban Policy.
  11. Buckley, Robert M. & Kalarickal, Jerry, 2004. "Shelter strategies for the urban poor : idiosyncratic and successful, but hardly mysterious," Policy Research Working Paper Series 3427, The World Bank.
  12. Yuki, Kazuhiro, 2007. "Urbanization, informal sector, and development," Journal of Development Economics, Elsevier, vol. 84(1), pages 76-103, September.
  13. Potts, Deborah, 2012. "Challenging the Myths of Urban Dynamics in Sub-Saharan Africa: The Evidence from Nigeria," World Development, Elsevier, vol. 40(7), pages 1382-1393.
  14. Fox, Sean, 2014. "The Political Economy of Slums: Theory and Evidence from Sub-Saharan Africa," World Development, Elsevier, vol. 54(C), pages 191-203.
  15. Brückner, Markus, 2012. "Economic growth, size of the agricultural sector, and urbanization in Africa," Journal of Urban Economics, Elsevier, vol. 71(1), pages 26-36.

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