Urbanization
Urbanizationrefers to the increasing number of people that live in urban areas.
Itpredominantly results in the physical growth of urban areas, be it horizontalor vertical.
TheUnited Nations projected that half of the world's population would live inurban areas at the end of 2008.
By 2050it is predicted that 64.1% and 85.9% of the developing and developed worldrespectively will be urbanized.
Urbanizationis closely linked to modernization, industrialization, and the sociologicalprocess of rationalization.
Urbanizationcan describe a specific condition at a set time, i.e. the proportion of totalpopulation or area in cities or towns, or the term can describe the increase ofthis proportion over time.
So theterm urbanization can represent the level of urban development relative tooverall population, or it can represent the rate at which the urban proportionis increasing.
Urbanizationis not merely a modern phenomenon, but a rapid and historic transformation ofhuman social roots on a global scale, whereby predominantly rural culture isbeing rapidly replaced by predominantly urban culture.
Thelast major change in settlement patterns was the accumulation ofhunter-gatherers into villages many thousand years ago.
Villageculture is characterized by common bloodlines, intimate relationships, andcommunal behavior whereas urban culture is characterized by distant bloodlines,unfamiliar relations, and competitive behavior.
Thisunprecedented movement of people is forecast to continue and intensify in thenext few decades, mushrooming cities to sizes incomprehensible only a centuryago.
Indeed,today, in Asia the urban agglomerations of Dhaka, Karachi, Mumbai, Delhi,Manila, Seoul and Beijing are each already home to over 20 million people, whilethe Pearl River Delta, Shanghai-Suzhou and Tokyo are forecast to approach orexceed 40 million people each within the coming decade.
OutsideAsia, Mexico City, Sao Paulo, New York City, Lagos and Cairo are fastapproaching being, or are already, home to over 20 million people.
Note: The above text is excerpted from the Wikipedia article "Urbanization",which has been released under the GNU Free DocumentationLicense.
What Should We Understand about Urbanization in China?
The scale of urbanization in China is without precedent in humanhistory. The transformation is also complex and nuanced, says Yale’s KarenSeto, with cities taking different approaches to environmental issues, pace ofdevelopment, and global connections.
Professor of Geographyand Urbanization, Yale School of Forestry & Environmental Studies
November 01, 2013
China’s extraordinaryeconomic boom has gone hand-in-hand with urbanization. In 1950 13% of people inChina lived in cities. By 2010, the urbanshare of the population had grown to 45%; it’sprojected to reach 60% by 2030. Twenty-five of the world’slargest 100 cities are in China.
Urbanization, in turn, is reshaping both the physicalenvironment and the cultural fabric. Take, for example, the issue of pollution.Huge cities place huge demands on the environment, but high-density livingconditions also present opportunities for improving efficiency of energy usage.
There are clear signs of the environmental challenge. When thecoal-fired plants that provide heat to the 11 million citizen of the farnortheastern Chinese city of Harbin came on for the first time this fall, airquality got so bad it created a whiteout that halted traffic, closed schoolsand shutdown the airport. Speaking on PBS Newshour, Evan Osnos of the NewYorker said that the environmental cost of China’s rapid development is feltacross the country. “People are losing their patience with it,” Osnos said.
At the same time, thereare efforts to raise environmental standards, including more than 80 low-carbonprograms going on around the country. They include developing emissionsinventories for carbon dioxide and other greenhouse gases, setting measurable emissions-reductiontargets, establishing carbon emission tradingplatforms, and creating carbon intensity standards (that is, determiningacceptable levels of carbon dioxide produced per unit of economic activity).Jonathan Woetzel, a director at McKinsey, explains thedriver behind this push to create a new norm: “It costs a lot less to prevent aproblem than to have to fix it later,” he says. “The competition now is aboutfinding those technologies that can increase productivity, be good for theenvironment, and deliver a high quality of urban life to the citizenry.”
Yale Insights talked with Karen C. Seto, a China expert andprofessor of geography and urbanization at the Yale School of Forestry andEnvironmental Studies. While underscoring the unprecedented scale of China’surban explosion, she encouraged a nuanced view of what urbanization means tothe country. “It’s not that China cities are bad for the environment—or thatthey’re all going to save the environment.” She points to Zhongshan as anexample of a city working to preserve its natural capital while developing,even as other cities appear to take an “anything goes” attitude.
Seto points out that different parts of China are at verydifferent phases of development. The earliest-developing cities—includingShanghai, Beijing, Shenzhen, and Guangzhou—have the most educated and wealthypopulations, but they are now competing with newly developed urban centers forbusinesses. While 20 years ago the coastal cities offered the best chance ofeconomic success, “nowadays, there are factories and enterprises set upthroughout the entire country, so there’s a lot more opportunity around theentire country.”
TRANSCRIPT
Q: What are three things thateveryone should know about urbanization in China?
Karen Seto: Okay so,three things that everyone should know about urbanization in China: One is thescale is just unprecedented, and I think for anybody who wants to study Chinaor do business in China, I would say go to China. And don’t just go to Beijingand Shanghai and Guangzhou. Go also to a second-tier city, because I think forsomeone who is entering the China market now, you’re going there today, let’ssay for the first time, your image of Chinese cities and China’s urbanizationis—if you go to Beijing and stay in Beijing—your image is one of a large scale,very modern. And you have no comparison to understand and to contextualizewhere these people are coming from and the big change that they’re undergoing.So, I would say the scale is so unprecedented that, in order to reallyunderstand it, you need to go to a smaller city. Take a plane ride and go west;head north. You don’t actually have to go very far. Even if you ride the trainout of Beijing about two hours, you’ll at least get a very different sense of asecond-tier city. So I think that’s one thing, getting a better sense of thescale.
The other thing that I think everyone needs to know aboutChina’s urbanization is that it’s a process that’s still in transition. Thereare some cities that are undergoing a third phase of transition, a third phaseof development. There are other cities that are just starting theirurbanization process, and so you’re going to be comparing apples and oranges.There are some cities where you’re going to get a very large labor pool, verydiverse labor pool, very educated labor pool, very sophisticated set ofconsumers. There’s going to be another set of cities that are primarily aregional hub for rural migrants, and there you’re not going to get the Guccisand kind of the fashion-forward, high-end consumer. You’re really looking atpeople who are really trying to significantly improve their standard of living,make the jump from an agrarian economy over to manufacturing. So, I think it’simportant to understand that this urbanization process is still underway andthat different cities are undergoing different urbanization transitions.
I think the third thing that’s critical about China’surbanization that everyone should know is that it’s not a black and whitething. It’s not that China cities are bad for the environment or that they’reall going to save the environment. There are clearly some cities thathave—Zhongshan is a good example down in the south that has really done a very,very good job in trying to preserve the environment, preserve ecosystemservices. Some of the cities that have been able to develop more slowly havebeen able to develop in a much more rational way in terms of, again, preservingthe environment. Other cities have a much more “go west” or frontier feeling,and when we think about the “go west” feeling or the frontier landscapes, thoseare places where almost anything goes. And so, you have some cities that aregrowing slowly, more methodologically, and others that are “this is a boomtown” feeling. And so, I think that the verdict is still out in terms of howurbanization will affect the environment and sustainability. But I think it’scritical for us to understand that it’s a very complex set of interactions andit’s a fast-moving train or a fast-moving plane. I go to China two to threetimes a year, and even in my field sites when I go back, places are constantlychanging. It’s a very dynamic place.
Q: How much are trends inChina’s rapidly growing cities setting the agenda for the country?
Seto: Urbanizationis driving economic development in China. There’s no doubt that what willhappen in the cities will have a huge impact for economic well-being for theentire country. You probably saw that the Chinese government recently indicatedthat urbanization is one of their top agenda items in the next ten years, andclearly they see urbanization as the pathway to lift millions of people out ofpoverty. And historically, if you look at the relationship between a country’surbanization level and its GDP, there’s a very strong relationship between whatpercentage of the population is engaged in agriculture and the country’s percapita GDP. And it’s very clear that what happens in Chinese cities will bereally critical for how the country develops economically and in terms ofenvironmental sustainability.
Q: What is the relationshipbetween globalization and urbanization in China?
Seto: So, if youlook at the cities that grew the fastest during the first wave of China’s urbanization—sothis is, again, in the '70s and '80s—those were the cities that were designatedas the special economic zones by the central government. So, these were placesthat were laboratories for different, new types of economic policies, and thoseare places that developed rapidly. We had a big influx of investments fromoverseas investors, and those are places where we can see the expansion offactories, of housing, of roads, etc. So, you can think of those cities ashaving a head start over all the other cities. These special economic zones hada head start in terms of economic development. They were the ones where theyhad the relationships with the overseas investors, FDI. And that really set, Iwould say, a precedent in terms of establishing managerial expertise,relationships with foreign investors, and also really incubating a local set oflocal knowledge and local know-how. But now all of China, in many ways, can bethought of as a special economic zone. If you go to any major city, any provincialcapital in China, you’re going to see foreign nationals, you’re going to seeforeign companies, but they’re primarily concentrated still along the coastalregions.
In the interior cities, we see a lot more of the domesticinvestments. There are foreign companies that are moving into the westernareas. The central government had a policy about a decade ago called the GoWest policy, which was to try to shift investment towards the west. We seethat. We see that in the economic data. We see that in terms of the impacts onurban development. But you can imagine places like Shanghai and Beijing have alot of connections, a lot of bilateral connections, in a way that an interiorcity like, let’s say, Wuhan or even Chengdu may not have. But what we’re seeingin those western cities is a lot of the more locally grown—a lot of thedomestic companies are in those places.
One of the things that I think is a challenge for many companiesoperating in China now certainly is the increase in labor costs. So the citieslike Shenzhen, Guangzhou—the cities that developed the fastest—those are theplaces where the labor costs are also the highest. Those are the places whereyou’re going to go and see really nice housing stock, you’re going to see thePrada shops, you’re going to see the Gucci shops. And those are places whereyou’re not going to find the factory workers, or very few of them. And so,we’re seeing the shift of, let’s say, manufacturing-based development movingmore inland into the country.
It’s very difficult to get workers to migrate long distances togo to the south anymore. Twenty years ago, it was the only game in town, and soworkers from all around the country really migrated and flocked to thesecoastal regions. But nowadays, there are factories and enterprises set upthroughout the entire country, so there’s a lot more opportunity around theentire country and certainly in the western regions as well.
Q: How does urbanization affectwhere Chinese companies locate?
Seto: Well, itdepends on what your business does, right? And so if your business requiresreally highly educated, maybe, services—high levels of technical know-how, Ithink that there certainly is a much larger labor pool in these establishedfirst-tier, provincial-level cities. If you’re a nuts and bolts widgets kind ofcompany and you can train everybody that you want to hire, I think you probablydon’t need to be in a Beijing or a Guangzhou or a Chongqing. You can probablygo to a second-tier city. Labor costs will be significantly lower. And you haveto remember that even though China’s urbanization levels are really high, thereis still a very large percentage of its population that is living in thecountryside and living in much, much smaller towns. And so, setting up shop ina smaller town, you’re a big fish in a small pond, as opposed to going to aplace where you’re competing with the Dells and Ciscos and SAPs and all theother global international companies. Not to mention the growing number ofChinese homegrown companies as well.
