Urban Growth and Its Impact on Development

Ana Goncalves () and Tiago Domingos

ERSA conference papers from European Regional Science Association

Abstract: According to a study by the United Nations on urbanization, the world population living in cities has been increasing exponentially and will continue to do so in the next years. From 1950 to 2007 the percentage of urban population has increased from 29% to nearly 50% and the projections made point that in the year 2050 this number will be 70%. Although these values are mainly influenced by what is happening in the developing regions where the percentage of rural population was high until recent years, the fact is that population migration to cities is happening all over the world, no matter the level of development of the country. So what we need to understand is: How is this process happening? How will urbanization influence the development of each region/country? Urban and regional economics have been studying these issues giving origin to some theories about urban growth and some consequences at an economic level. However it is still lacking a model that integrates the major empirical patterns and that includes a broad view of the multiple dimensions of production. The aim of this work is to create a model that includes different works, empirical and theoretical in the fields of economics and urban development. We aim to include the empirical studies of Zipf's rule related with the distribution of cities, Bettencourt et al's findings about scaling laws applied to cities, the von Thünen model, the Solow neo-classical model of growth and Ayres's growth model that adds the term of useful work in the production function and so eliminates the need of the so called Solow residual. One other advantage of joining these different models is the possibility to assess the advantages and disadvantages of urbanization in a quantitative way. This may be a crucial understanding for governments and their regional planning.

Date: 2011-09
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