Analyzing urban systems: have megacities become too large ?

Klaus Desmet and Esteban Rossi-Hansberg

No 6872, Policy Research Working Paper Series from The World Bank

Abstract: The trend toward ever greater urbanization continues unabated across the globe. According to the United Nations, by 2025 closes to 5 billion people will live in urban areas. Many cities, especially in the developing world, are set to explode in size. Over the next decade and a half, Lagos is expected to increase its population 50 percent, to nearly 16 million. Naturally, there is an active debate on whether restricting the growth of megacities is desirable and whether doing so can make residents of those cities and their countries better off. When analyzing whether megacities have become too large, policy makers often analyze a single city in depth. But no city is an island: improving urban infrastructure in one city might attract migrants, and a negative shock in one location can be mitigated because people can move to another. Considering the general equilibrium effects of any such urban policy is thus key. That is, when deciding whether to make medium-size cities more attractive, policy makers need to understand how cities of all sizes will be affected. The second section briefly summarizes the theoretical framework and discusses which data are needed. The third section implements the methodology for the benchmark case of the United States. The fourth section does the same for China and Mexico and compares the findings. And the last section concludes. A technical online appendix guides the reader through a practical, step-by-step, discussion of how to do the analysis.

Keywords: City Development Strategies; Urban Slums Upgrading; Urban Services to the Poor; Regional Governance; Urban Governance and Management (search for similar items in EconPapers)
Date: 2014-05-01
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Analyzing Urban Systems: Have Megacities Become Too Large? (2013)
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