CH7 urbanization

CH7 urbanization - CH. 7 Urbanization I. Main Dilemma of...

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CH. 7 Urbanization I. Main Dilemma of Urbanization A. Unprecedented levels of rural-urban migration in developing world that is important because of rapid population growth B. General Urbanization trends 1. level of urbanization typically associated with higher level of economic growth 2. LDC more urbanized now then developed countries were at similar stage of development 3. urbanization happening everywhere but cities growing faster in developing countries C. Main problems of rapid urbanization in the developing world 1. crime, pollution and congestion begin to outweigh benefits of urbanization 2. leads to creation of an urban bias for development strategies a. creation and expansion of slums by those that cannot afford legal housing 3. current development strategies do not adequately address this problem 4. development and growth of informal sector II. Role of Cities A. Agglomeration economies- cities grow because of cost advantages to consumers and producers 1. users of products want to be near producers to avoid transportation costs 2. producers of same industry want to be near to draw on same pool of workers B. Industrial Districts- the “clustering” of industry 1. producers benefit from information spillovers from other firms in industry 2. consumers know where to purchase best goods in industry by reputation 3. differing levels of clustering a. village/artisan guilds that specialize in product but not internal labor b. any evolvement to more specialize industry cluster 4. groups of firms in same industry can develop social capital a. possibilities for mutual cooperation and collective action b. past cooperation ensures trust and further cooperation 5. output rises with available pool of workers 6. productivity rises with increase in city size C. Efficient Urban Scale 1. technological spillover can happen between different industries if they are located together 2. too many industries creates large congestion problems
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CH7 urbanization - CH. 7 Urbanization I. Main Dilemma of...

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