WR - 7.3-Urban Giantism Problem+Case Study [PDF]

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C. The Urban Giantism Problem



Urban Giantism is the phenomenon of urban settlements growing disproportionately large in size due to rapid migration of people from other areas to these urban settlements. 



First City Bias -



It is a form of urban bias that has often caused considerable distortions. The country’s largest or first (“first place”) city receives a disproportionately large share of public investment and incentives for private investment in relation to the country’s second-largest city and other smaller cities.



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The large city receives all the investments, public goods and services, employment opportunities and most of the economic activities are largely concentrated in this city only. People are attracted to this city and they migrate for better life and opportunities.



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The major problem with this first city bias is the complexity in managing the resources and creation of employment in the city and the rise of urban informal sectors. The piling population in the city puts pressure on the employment opportunities which reduces the wage rate in the city. This makes living in the city very difficult and costly.



Causes of Urban Giantism 



Hub-and-spoke transportation system -



a system of air transportation in which local airports offer air transportation to a central airport where long-distance flights are available



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Location of the political capital in the largest city



Explanation for urban giants generally involves unfortunate consequences of political economy–



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Import substitution industrialization: there is much less international trade, and population and economic activity have an incentive to concentrate in a single city, largely to avoid transportation costs



Another explanation focuses on the consequences of dictators’ efforts to remain in power– 



“Bread and circuses” for the first city (usually the capital) to prevent unrest



Case Study Rural-Urban Migration and Urbanization in Developing Countries: India and Botswana



India The main reason for rural to urban migration in India is that employment in urban areas produces higher wage and consistent employment compared to rural areas. The time span for employment was shorter in urban areas but are in the informal sector as they run a corner store or market stand as it only requires low skilled that are usually self-employed. As the informal sector become the stepping stone for future success but only few where able to increase their life style. As the earning of migrants make up one third of the total income of the urban sector because most of their earning are used in their home towns or village. As the main reason of migrating was for higher wage they choose to transfer their earning to their families in the rural area as it has a lower price of living expenses. Botswana Robert E.B. Lucas, the one who conducted a study of the migration behavior in Botswana, developed an econometric model that consists of four groups of equations - for employment, earnings, internal migration, and migration to South Africa. The result shows that that unadjusted urban incomes were 68% higher than rural incomes for males only, but the inequality was decreased when education and experience were considered. The results of his study proved that the higher the expected earnings and the higher the probability of expected employment, the



greater the chance that a person would migrate. But if that will be the situation in his home village, there would be lower chance that the person will migrate. Lucas estimated that one job created in an urban center would draw more than one new migrant from the rural areas. Compared to India, migrants in Botswana moved to “town sized” urban centers as opposed to metropolitans such as Delhi or Mumbai.