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What Explains China's Rising Urbanisation in the Reform Era?

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  • Kevin Honglin Zhang

    (Department of Economics, Illinois State University, Normal, IL 61790-4200, USA, khzhang@ilstu.edu)

Abstract

China has been transforming from a rural to an urban economy over the past century, especially since 1978 when economic reforms were initiated and rapid economic growth began. This paper attempts to investigate what factors contributed to the rising urbanisation in the period 1978-2000, based on time-series and cross-section analyses. We find that the main driving-forces behind urbanisation, besides changes in urban policy, are economic growth, structural changes and especially inflows of foreign direct investment (FDI). The causal link runs from economic growth to urbanisation and not vice versa. FDI inflows contribute greatly to the coast-inland differences in the rate of urbanisation. Geographical and historical factors have a significant impact on regional urbanisation levels and a high initial level of urbanisation curtails a province's subsequent urban growth.

Suggested Citation

  • Kevin Honglin Zhang, 2002. "What Explains China's Rising Urbanisation in the Reform Era?," Urban Studies, Urban Studies Journal Limited, vol. 39(12), pages 2301-2315, November.
    • Handle: RePEc:sae:urbstu:v:39:y:2002:i:12:p:2301-2315
    DOI: 10.1080/0042098022000033881
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    References listed on IDEAS

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    1. Kevin Honglin Zhang, 2001. "How does foreign direct investment affect economic growth in China?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 9(3), pages 679-693, November.
    2. Markusen, James R. & Venables, Anthony J., 1999. "Foreign direct investment as a catalyst for industrial development," European Economic Review, Elsevier, vol. 43(2), pages 335-356, February.
    3. Hamer, Andrew M. & Linn, Johannes F., 1987. "Urbanization in the developing world: Patterns, issues, and policies," Handbook of Regional and Urban Economics, in: E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 2, chapter 32, pages 1255-1284, Elsevier.
    4. Zhang , Kevin Honglin, 2001. "What Explains the Boom of Foreign Direct Investment in China?," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 54(2), pages 251-274.
    5. Hollis Chenery† & T.N. Srinivasan (ed.), 1988. "Handbook of Development Economics," Handbook of Development Economics, Elsevier, edition 1, volume 1, number 1.
    6. Zhang, Kevin Honglin & Markusen, James R., 1999. "Vertical multinationals and host-country characteristics," Journal of Development Economics, Elsevier, vol. 59(2), pages 233-252, August.
    7. Chang, Kyung-Sup, 1994. "Chinese urbanization and development before and after economic reform: A comparative reappraisal," World Development, Elsevier, vol. 22(4), pages 601-613, April.
    8. Williamson, Jeffrey G., 1988. "Migration and urbanization," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 11, pages 425-465, Elsevier.
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    Cited by:

    1. Zelai XU & Mary-Françoise RENARD & Nong ZHU, 2007. "Migration, urban population growth and regional disparity in China," Working Papers 200730, CERDI.
    2. Sridhar, Kala Seetharam, 2016. "Costs and Benefits of Urbanization: The Indian Case," ADBI Working Papers 607, Asian Development Bank Institute.
    3. Zhen Yang & Jun Lei & Jian-Gang Li, 2019. "Identifying the Determinants of Urbanization in Prefecture-Level Cities in China: A Quantitative Analysis Based on Spatial Production Theory," Sustainability, MDPI, vol. 11(4), pages 1-18, February.
    4. Fan Wu & Ling-Hin Li & Sue Yurim Han, 2018. "Social Sustainability and Redevelopment of Urban Villages in China: A Case Study of Guangzhou," Sustainability, MDPI, vol. 10(7), pages 1-18, June.
    5. Ling-Hin Li, 2017. "Balancing Rural and Urban Development: Applying Coordinated Urban–Rural Development (CURD) Strategy to Achieve Sustainable Urbanisation in China," Sustainability, MDPI, vol. 9(11), pages 1-15, October.

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