Urbanizing with Equity Consideration

ERN: Equity Pub Date : 2017-01-20 DOI:10.2139/ssrn.2955517
Guanghua Wan, Zhi Luo, Xun Zhang
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Abstract

Research has not yet been undertaken on the optimal level of urbanization, notwithstanding the pioneering work of Au and Henderson (2006) on optimal urban concentration. We develop two-sector general equilibrium models of urbanization, with and without equity consideration, respectively. It is shown that considering equity will result in a higher level of urbanization than otherwise, when urban inequality is sufficiently small or migration costs are sufficiently large. Such a theoretical prediction is confirmed by empirical modeling results using panel data from People’s Republic of China (PRC). Provincial governments that paid attention to the inequality issue are found to have higher urbanization levels than those that did not. Finally, we explore possible equity consideration-to-urbanization transmission channels, and empirically establish that equity consideration in PRC (e.g., government initiatives towards combating rural poverty or the urban-rural gap) is positively correlated with road density, which helps reduce migration costs, and with bank lending to the manufacturing sector, which helps enhance the pulling force of migration. Thus, policy makers in the developing world should reverse their prevailing anti-urbanization attitudes and practices that tend to slow down urbanization or restrict rural-to-urban migration.
以公平为代价的城市化
尽管Au和Henderson(2006)对最优城市集中度进行了开创性的研究,但尚未对最优城市化水平进行研究。我们分别建立了考虑和不考虑公平因素的两部门城市化一般均衡模型。研究表明,当城市不平等足够小或移民成本足够大时,考虑公平将导致更高水平的城市化。这一理论预测得到了中华人民共和国面板数据实证模型结果的证实。研究发现,重视不平等问题的省级政府的城市化水平高于没有重视不平等问题的省级政府。最后,我们探讨了可能的公平考虑到城市化的传导渠道,并通过经验建立了中国的公平考虑(例如,政府为消除农村贫困或城乡差距而采取的举措)与道路密度呈正相关,这有助于降低迁移成本,并与银行向制造业提供贷款,这有助于增强迁移的吸引力。因此,发展中世界的决策者应扭转其普遍的反城市化态度和做法,因为这种态度和做法往往会减缓城市化或限制农村向城市的移徙。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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