Kelso's Corner

[Editor’s note: Returning from traveling in China, cities, growth, and urban geography are on my mind. Enjoy this article from the Economist about a rapidly urbanizing world populous, and how that is not necessarily a bad thing for poverty and wealth.]

Reprinted from The Economist print edition. Nov 6th 2008.

The problems—and benefits—of urbanisation on a vast scale

IN JANUARY this year a vast number of would-be travellers were stranded at railway stations and on roads in China, after an unusually heavy snowfall blanketed the south of the country just before the country’s new-year festivities. What amazed the world (in addition to the unusual sight of a prime minister apologising for his government’s slowness) was the unprecedented scale of the disruption: an estimated 200m people were on the move.

Governments in many poor countries react with a shudder to this sort of news item—and indeed to any news that seems to expose the fragility of newly urbanised economies. Most of those frustrated Chinese travellers were migrant workers going from cities to their families in the countryside or vice versa. Movement on such a scale seems inevitable, given the sort of urbanisation China and others have experienced: over the past 30 years, the world’s urban population has risen from 1.6 billion to 3.3 billion, and over the next 30 years cities in the developing world are set to grow by an extra 2 billion. But many governments have become doubtful of their ability to cope with urbanisation on such an enormous scale; some have concluded that they ought to slow the process down in order to minimise social upheaval. This view owes as much to anti-urban bias as it does to sober analysis.

In 2005, more than half the poor countries surveyed by the UN Population Division said they wanted to reduce internal migration to rein in urban growth. The food crisis of the past 18 months has sharpened worries about how to feed the teeming slums. This week the UN’s secretary-general, Ban Ki-moon, warned the biennial World Urban Forum meeting in Nanjing that 2 billion could be living in slums in the year 2030 and that “urban areas consume most of the world’s energy and are generating the bulk of our waste.”

Such fears of urban over-concentration are reflected in the policies of many different countries. Saudi Arabia is spending billions on new super-cities to ease the growth of Jeddah and Riyadh. Egypt is building 20 new cities to divert people away from Cairo. It plans 45 more. And attempts by poor countries to alter the course of urbanisation have a long pedigree in the rich world. In the 1950s and 1960s, Britain and France built lots of new towns to counter-balance their capitals’ dominance.

Yet new research published by the World Bank in its annual flagship World Development Report* suggests that pessimism over the future of huge cities is wildly overdone. The bank argues that third-world cities grow so big and so fast precisely because they generate vast economic advantages, and that these gains may be increasing. Slowing urbanisation down, or pushing it towards places not linked with world markets, is costly and futile, the bank says. At a time of contagion and bail-outs, the research also reaffirms the unfashionable view that the basic facts of geography—where people live and work, how they get around—matter as much as financial and fiscal policies. (The award of this year’s Nobel prize for economics to Paul Krugman of Princeton University for his work on the location of economic activity was another reflection of that view.)

The bank’s research yields lots of new insights. It argues, for example, that the share of humanity that lives in cities is slightly lower than most people think. The bank drew up a fresh index to get around the knotty problem of defining “urban”; this new measure puts the world’s city-dwelling population at about 47% in 2000. In fact—as Indermit Gill, who oversaw the report, acknowledges—it is impossible to pinpoint the proportion: the urban slice of humanity may be anywhere between 45% and 55%, depending on how you count. The report’s main point is that, whatever their exact dimensions, the Gotham Cities of the poor world should not be written off as a disaster simply on grounds that they are too big, too chaotic, too polluted and too unequal.

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