Working Paper: CEPR ID: DP12072
Authors: Luc Christiaensen; Ravi Kanbur
Abstract: This review is framed around the exploration of a central hypothesis: A shift in public investment towards secondary towns from big cities will improve poverty reduction performance. Of course the hypothesis raises many questions. What exactly is the dichotomy of secondary towns versus big cities? What is the evidence for the contribution of secondary towns versus cities to poverty reduction? What are the economic mechanisms for such a differential contribution and how does policy interact with them? We find preliminary evidence and arguments in support of our hypothesis, but the impacts of policy on poverty are quite complex even in simple settings, and the question of secondary towns and poverty reduction is an open area for research and policy analysis.
Keywords: secondary towns; poverty reduction; mega cities; urbanization; rural-urban migration; zipf's law
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Public investment in secondary towns (H54) | Poverty reduction outcomes (I32) |
| Public investment in big cities (H54) | Poverty reduction outcomes (I32) |
| Migration to secondary towns (R23) | Poverty reduction (I32) |
| Migration to big cities (R23) | Poverty reduction (I32) |
| Reallocating public investment from big cities to secondary towns (H54) | Enhanced poverty reduction outcomes (I32) |