Working Paper: NBER ID: w27201
Authors: J. Vernon Henderson; Matthew A. Turner
Abstract: We describe patterns of urbanization in the developing world and the extent to which they differ from the developed world. We consider the extent to which urbanization in the developing world can be explained by conventional models of spatial equilibrium. Despite their relative poverty, developing world cities are relatively highly productive, and often provide good access to safe water, improved sanitation, schooling and inoculations. In some parts of the world, they are home to a surprisingly small number of factory workers and a surprisingly large number of farmers. Developing world cities seem to do less well at protecting their residents from lifestyle diseases and crime, their female residents from domestic violence and their children from illness. In thinking about these facts, we note that one strand of the literature focused on structural transformation has suggested that urbanization in the developing is occurring `too early’, while another strand argues that urbanization is occurring `too slow’ to be consistent with conventional models of spatial equilibrium. Despite many differences between developing and developed world cities, our new results combined with those in the literature suggest that models of spatial equilibrium can be adapted to be a useful guide to understanding the process of urbanization in the developing world.
Keywords: Urbanization; Developing Countries; Spatial Equilibrium; Economic Development
JEL Codes: O18; R11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| higher urban density (R23) | increased household net income (D19) |
| higher urban density (R23) | increased hourly wages (J38) |
| higher urban density (R23) | improved access to utilities (L95) |
| higher urban density (R23) | improved health outcomes (I14) |
| higher urban density (R23) | worsening health outcomes (domestic violence and child health) (I14) |