Counter visits from more than 160  countries and 1400 universities (details)

The political economy of development
This academic site promotes excellence in teaching and researching economics and development, and the advancing of describing, understanding, explaining and theorizing for planning for development.
About us- Castellano- Français - Dedication
Home- Themes- Reports- Statistics/Search- Lecture notes/News- People's Century- Puro Chile- Mapuche

On Planning for Development:
Urbanization and Development   Urbanization     Population     Agglomeration economies*   The Right to the City

Castellano - Français   Editor: Róbinson Rojas Sandford
The Urban Hierarchy

From World Urbanization Prospects 1999 - United Nations
The urban hierarchy
Undoubtedly one of the major changes taking place in the distribution of the world population over the past two centuries is the concentration of large numbers of people in relatively small, highly urbanized areas known as urban agglomerations. Over the course of the twentieth century, the population of certain urban agglomerations grew to levels unprecedented in human history. Thus, it is estimated that by 2000 a total of 19 urban agglomerations had at least 10 million inhabitants each, so that the population of a single one of them surpassed the total population of countries such as Hungary, Portugal or Sweden. For that reason, such populous urban agglomerations have become known as mega-cities. Yet, despite their size and importance, mega-cities still account for a relatively small share of both the world population and the world urban population. In 2000 the total population in the 19 mega-cities constituted 4.3 per cent of the world population and 9.2 per cent of the urban population (tables 48 and 49) and, although the number of mega-cities is expected to rise to 23 by 2015, they will jointly account for 5.2 per cent of the world total population and 9.8 per cent of the urban population at that time.

From World Urbanization Prospects 2001 - United Nations
The urban hierarchy

From World Urbanization Prospects 2003 - United Nations
The urban hierarchy

Agglomeration Economies
March 2006
Agglomeration economies and the location of Foreign Direct Investment: quasi-experimental evidence from Romania
Christian A. L. Hilber and Ioan Voicu

How important are agglomeration economies for the location of foreign manufacturing plants? We investigate this question by combining innovations from previous studies and by taking advantage of a quasi-experimental setting: the political and economic transition in Romania. The recent, sudden and sustained influx of foreign investors into Romania provides an ideal setting to disentangle agglomeration economies from endowment effects. Using a countylevel conditional logit set-up that controls for choice-specific fixed effects and endowment effects, we find that external economies from industry-specific foreign agglomeration and service agglomeration are important location determinants. Increases in the number of foreign plants and in service employment density by 10 percent make the average county 2.2 and 6.2 percent more likely to attract a new foreign investor. Local labor market conditions also matter. Our findings suggest that results are sensitive to the choice of geographical unit of observation and the inclusion of locational fixed effects.

Economies of scope and economies of agglomeration: The Goldstein-Gronberg contribution revisited
John B. Parr - 2004
Department of Urban Studies, University of Glasgow, Glasgow G12 8QQ, U.K.

Following on from the work of Goldstein and Gronberg, it is argued that under certain conditions, internal economies of scope form the bases for two types of agglomeration economy. These differ from two better known types, which are based on internal and external economies of scale. A further two types of agglomeration economy are shown to derive from particular forms of external economy. Attention is then given to the conditions under which economies of scope may be accompanied by either agglomeration economies or agglomeration diseconomies, both internal to the firm. The discussion is extended to the setting of a simple urban system, where agglomeration economies and diseconomies internal to the firm may each exist alongside agglomeration economies or diseconomies deriving from externalities. A scheme is then outlined, in which the various types of agglomeration economy are drawn together within a common framework.

Prepared for the Blackwell Companion to Urban Economics - April 13, 2004
The Micro-Empirics of Agglomeration Economies
Stuart S. Rosenthal and William C. Strange

This chapter considers evidence on the spatial concentration of economic activity. Two kinds of concentration are considered: the agglomeration of population into cities and the clustering of industries into specialized regions. The chapter considers the productivity advantages of city size and industrial concentration. It also looks at the geographic and organizational dimensions of these externalities, as well as their sources. In the course of this, the chapter discusses methodological issues that pertain to this kind of measurement. It concludes with implications for public policy.

Agglomeration Economies and the High-Tech Computer
Nancy E. Wallace and Donald Walls

This paper considers the effects of agglomeration on the production decisions of firms in the high-tech computer cluster. We build upon an alternative definition of the high-tech computer cluster developed by Bardhan et al. (2003) and we exploit a new data source, the National Establishment Time-Series (NETS) Database, to analyze the spatial distribution of firms in this industry. An essential contribution of this research is the recognition that high-tech firms are heterogeneous collections of establishments. We explicitly model the kinship relationships between the headquarters and establishments of these firms and account for their endogenous production technology choices using controls for the spatial and functional configurations of each firm’s establishment locations. The empirical results, from our preferred specification of a random parameters restricted maximum likelihood (REML) production function, are broadly consistent with several recent theoretical models of supply chain management under incomplete contracting (Combes and Duranton (2003), Almazan et al. (2003), and Rotemberg and Saloner (2000)). We find statistically significant and economically meaningful localization effects on high-tech firms’ labor input technology arising from MSA-level proximity to workers in computer services Standard Industrial Classifications (SICs) and establishment-level geographic interactivity. We also find that localization effects have economically significant impacts on the elasticities of other purchased inputs. The channels for these effects are again access to large computer services labor markets and geographically dispersed networks of establishments. Our empirical results indicate that there are few benefits associated with firm locations in labor markets with large numbers of employees in the computer manufacturing sectors. This negative result may reflect the culmination of recent trends in out-sourcing manufactured inputs to distant offshore subsidiaries. Finally, we uncover considerable heterogeneity in the production technologies exploited by firms in the high-tech computer cluster, although in general, the production technology of this industry is characterized by constant returns to scale.

Agglomeration Economies: The Spark That Ignites a City?
Satyajit Chatterjee

In industrially developed countries, employment is heavily concentrated in cities. A concentration of workers and businesses in one location — what economists call agglomeration economies — lowers production costs. In fact, most economists believe that in the absence of agglomeration economies, the spatial distribution of employment would be much more even. In this article, Satyajit Chatterjee discusses his research, which questions this belief. He finds that while agglomeration economies are an important factor, they’re not the most important one. The combined effects of factors unrelated to agglomeration economies, such as the availability of natural resources and local economic policies, appear to account for the bulk of the spatial concentration of U.S. employment. The bulk of an industrially developed country’s economic activity takes place in cities. Typically, these cities make up a relatively small portion of the country’s overall territory.

Natural clusters: Why policies promoting agglomeration are unnecessary      PDF file
Philippe Martin, Thierry Mayer and Florian Mayneris - 4 July 2008

Governments spend heavily on industrial clusters. They are wasting their money if firms naturally cluster to reap agglomeration gains. This column presents evidence from France that questions policymakers’ enthusiasm for promoting clusters.
Policymakers love to promote industrial clusters. Since the end of the 1980s, national and local governments in Germany, Brazil, Japan, South Korea, Spanish Basque country, and France, inter alia, have attempted to foster their development. And they haven’t done it on the cheap – the French government recently devoted €1.5 billion to “competitiveness clusters”. Why are politicians so keen on clusters and is the money well spent?

Urban Amenities or Agglomeration Economies? Locational Behaviour and Entrepreneurial Success of Dutch Fashion Designers
Rik Wenting, Oedzge Atzema & Koen Frenken - 2008

Urban economic growth and industrial clustering is traditionally explained by Marshallian agglomeration economies benefiting co-located firms. The focus on firms rather than people has been challenged by Florida arguing that urban amenities and a tolerant climate attract creative people, and the firms they work for, to certain cities. We analyse to what extent these two mechanisms affect the locational behaviour of Dutch fashion designers. On the basis of a questionnaire, we find that urban amenities are considered more important than agglomeration economies in entrepreneurs’ location decision. Designers located in the Amsterdam cluster do not profit from agglomeration economies as such, but rather from superior networking opportunities with peers both within and outside the cluster.

From the World Bank database
World Bank Discussion Paper No. 415
Facets of Globalization. International and local dimensions of development
S. Yusuf, S. Evenett and J. Wei, editors
October 2001
The chapters in this volume underscore the transformative role of globalizationurbanization and exo-urbanization and show the interplay between these forces. 
Trade reform and liberalized foreign investment regimes have contributed to the spatial reallocation of economic activity toward cities, especially those cities that can attract and nurture human capital and strong connections to other markets.
Global factors have, therefore, reinforced agglomeration economies in shifting economic clout toward cities, and in so doing they may be exacerbating regional disparities in incomes.

World Development Report 2009
Spatial Disparities and Development Policy
Reshaping  Economic Geography
Published November 6, 2008

Growing cities, ever more mobile people, and increasingly specialized products are integral to development. These changes have been most noticeable in North America, Western Europe, and Northeast Asia. But countries in East and South Asia and Eastern Europe are now experiencing changes that are similar in their scope and speed. World Development Report 2009: Reshaping Economic Geography concludes that such transformations will remain essential for economic success in other parts of the developing world and should be encouraged.

Economic activity is increasingly concentrated within countries. Across the world, an estimated three quarters of economic production takes place in cities; the more dynamic coastal regions of China produce more than half of the country’s GDP with less than one fifth of its land area; and Greater Tokyo accounts for 40 percent of Japan’s total output on just 4 percent of its land area. In the developing world, this concentration has been accompanied by sizeable—and by some accounts increasing—spatial disparities in living standards and welfare. Per capita income differentials within countries in the developing world tend to be much larger than equivalent differentials within rich countries. Paradoxically, in a world which is rapidly globalizing, one of the most important determinants of well-being is still where a person is born: in which country, in what province within the country, and whether in a city or the countryside within that province.

Read also Reshaping Economic Geography in East Asia a companion volume to the World Development Report 2009. It brings together noted scholars to address the spatial distribution of economic growth in Asia. It reveals how the new economic geography is reshaping development objectives: from initiatives to foster growth via enhanced agglomeration and connectivity to the world economy, to programs that channel resources to lagging regions. Key themes include how East Asian governments have dealt with agglomeration economies, urbanization, and regional disparities; improving connectivity with infrastructure investments; and eliminating barriers both inside and outside borders to favor the movement of labor, goods, and services.
This volume will be of great interest to readers working in the areas of economic policy, poverty reduction and urban-rural development strategies, and transport-led infrastructure policy.

Globalization and World Cities (GaWC) Research Network
Centred in theGeography Department at Loughborough University, this research network focuses upon the external relations of world cities. Although the world/global city literature is premised upon the existence of world-wide transactions, most of the research effort has gone into studying the internal structures of individual cities and comparative analyses of the same. Relations between cities have been neglected by world cities researchers; the Globalization and World Cities (GaWC) Research Network has been formed to aid in rectifying this situation (see Multiple GaWCs - a brief introduction to the multi-facetted nature of GaWC - and Formative Missions for GaWC).

From The World Bank - 18 Sept. 2006
An East Asian Renaissance: Ideas for Economic Growth
Advance Conference Edition
East Asia – a region that has transformed itself since the financial crisis of the 90s by creating more competitive and innovative economies – must now turn to the urgent domestic challenges of inequality, social cohesion, corruption and environmental degradation arising from its success.

From the Asian Development Bank - 2006
Urbanization and Sustainability in Asia - 2006
Case Studies of Good Practice
Edited by Brian Roberts and Trevor Kanaley

Cities Alliance Annual Reports
From The Journal of Political Economy, Vol. 9, Issue 3 (June 1991), 483-499
Increasing returns and economic geography
By Paul Krugman

P. Krugman, 1994:
Urban concentration: the role of increasing returns and transport costs

Comment, A. M. Isserman
Comment, J. V. Henderson
Floor discussion
From "Proceedings of the World Bank Annual Conference on Development Economics", 1994

World Urban Forum 2008 Seeks More Livable, Sustainable Cities

-- One in three city residents in developing countries lives in slums
-- World Urban Forum looks at how to manage rapid urbanization
-- New World Bank strategy to incorporate both environmental and energy efficiency considerations into urban design

October 30, 2008— How can “heartbreaking” slums become cleaner, kinder, greener places even as more and more people move to cities?
That’s a key question for policy-makers, development practitioners and non-governmental organizations seeking sustainable solutions to urban dilemmas at the World Urban Forum in Nanjing, China, November 3 to 6.
While cities have become engines of growth for developing countries and a magnet for people seeking better economic opportunities, one in every three city residents in developing countries now lives in a slum. The highest-incidence of slum-dwellers (62 percent) is in Sub-Saharan Africa, according to a new UN-Habitat report, “State of the World’s Cities 2008/9: Harmonious Cities.”

A Billion People in Slums
“A billion people in the world live in slums today, and that in itself is a startling fact,” says Abha Joshi-Ghani, Manager of the World Bank’s Urban group. “The quality of life and livability of these areas is really heartbreaking.”
Most  people in slums don’t have drinking water, sanitation, health, or education services, she says.
“While the poverty rate is generally  higher in rural areas, the actual number of poor is higher in urban areas” says Joshi-Ghani.
“Slums are a function of successful labor markets and failed land markets.”
The problem could worsen if, as projected, three-quarters of the world’s population is living in cities by 2013. About 90 percent of urban growth is expected to take place in developing countries.

Poverty Increasingly Urban Phenomenon
Megacity Manila grew by 1.62 million people in seven years as people migrated from rural areas.
“Poverty is increasingly an urban phenomenon,” says Chii Akporji, Communications Officer  of  the  Cities Alliance, a coalition of cities and development partners including the UN and World Bank whose secretariat is housed at the World Bank.

From Finance & Development
A quarterly magazine of the IMF
September 2007 - Volume 44 Number 3

March of the Cities
The Urban Revolution

David E. Bloom and Tarun Khanna
The year 2008 marks a watershed in the complex and ongoing urban revolution. For the first time, more than 50 percent of the world's people will live in urban areas. Rapid urbanization may prove a blessing, provided the world takes notice and plans accordingly.
(pdf file: 732 kb)

Urban Poverty
Martin Ravallion
The poor are gravitating to towns and cities, but maybe not quickly enough. A faster pace of urbanization could induce more rapid poverty reduction. Development policymakers should facilitate this process, not hinder it.
(pdf file: 299 kb)

Big, or Too Big?
Ehtisham Ahmad
Megacities create special issues of governance, funding, and provision of services. Both national governments and megacities can secure potential benefits by exploring the devolution of clearly defined responsibilities and revenue-raising capacity that provide incentives for good governance.
(pdf file: 279 kb)

Point of View
What Is the Biggest Challenge in Managing Large Cities
Matthew Maury, Kishore Mahbubani, and Ramesh Ramanathan and Swati Ramanathan
Three points of view on different ways to manage the expansion of cities well .
(pdf file: 137 kb)

From The World Bank - 18 Sept. 2006
An East Asian Renaissance: Ideas for Economic Growth
Advance Conference Edition
East Asia – a region that has transformed itself since the financial crisis of the 90s by creating more competitive and innovative economies – must now turn to the urgent domestic challenges of inequality, social cohesion, corruption and environmental degradation arising from its success.

Guiding Cities: The Urban Management Programme

Babar Mumtaz and Emiel Wegelin. (136 pages, May 2001)
The way that cities are managed and administered has a direct bearing on their ability to support economic development and mitigate poverty. Therefore all those concerned with either economic or with social development should also be concerned with urban development and management and how their actions impact on cities and vice versa. The primary objective of this book is to provide a guide for those concerned with economic or social development, as well as those concerned more directly with urban development and management, to the main issues and the range of options available to deal with them. The presentation of issues and options is accompanied by examples of practice generated by the Urban Management Programme in cities in countries around the world.
The first section presents an overview of urbanisation and urban management, setting out the processes by which cities grow and develop and the role they play in human and economic development. Some of the main trends and directions of policy advice and intervention are introduced. This is followed by three sections looking at Urban Governance, Urban Poverty Reduction and Urban Environmental Management. Within each section are particular areas, ranging from leadership, accountability and democracy through privatisation, partnership and participation to vulnerability and social exclusion and integration, to urban heritage protection. Within these, problems are summarised, followed by an indication of some of the issues raised in addressing them. Guidelines for Action are presented as a series of steps that could be undertaken in order to confront the issues and resolve the problems. These Guidelines draw upon the experience of the Urban Management Programme, and case studies of (successful) interventions are presented. There is a brief list of resources and documentation that can provide further information and assistance.

From the data files of the World Bank
File 11910
The economics of urbanization and urban policies in developing countries - 1987
George S. Tolley and Vinod Thomas, editors

An Overview of Urban Growth: Problems, Policies, and Evaluati
----Patterns of Urbanization
----Urbanization and Economic Development
----Sources of Future Urbanization
----Economic Causes of Urban Problems
----Urbanization Policy in Market and Mixed Economies
----Urbanization Policy in a Centralized Economy
----Concentration and Decentralization Policies
----Addressing Urban Problems

Economic opening and industrial agglomeration in China
Zhao Chen, Yu Jin and Ming LuZhao - 2005

This paper explores the causes of industrial agglomeration in China using the provincial panel data during 1987-2001, focusing on the effects of economic opening. The determinants of industrial agglomeration are tested by controlling three types of factors, those of economic policies, economic geography and new economic geography, respectively. In summary, we find: (1) Economic opening, which is also related with geography and history encourages industrial agglomeration; (2) Large market size, effects of forward and backward linkage, high level of urbanization, better infrastructure and less involvement of local government tend to facilitate industrial concentration; (3) Costal regions have geographical advantage in attracting firms. These findings not only support the new economic geography theory from evidence within China, but also emphasize the important role that policies like economic opening might directly play in industrial agglomeration. The most important policy implication of this paper is that by quickening up the step of integrating into world economy and deregulating, even those less developed regions might accelerate industrial agglomeration and thus decrease regional disparity.

Environment and Urbanization
Globalization and cities
Volume 14 Number 1 April 2002
Publisher: International Institute for Environment and Development
The articles may be reproduced free of charge provided the author is acknowledged - Archive

On Development
Human Development
Sustainable Development
Education for Sustainable Development
Climate Change

On Development Economics
The Future of Development Economics
The New Economy in Development
The Need to Rethink Development Economics
Development Economics
Economic Literacy
Basic knowledge on economics

RRojas Databank is a member of Development Gateway hosted by The World Bank

Education for Sustainability
Postgraduate courses on
Environment and
Development Education at
London South Bank University

- Part time distance learning
- Full time at the University

- Come visit us at

- Notes for lectures
- Notes and papers

- Global Value Chains
- Integrated International

- International Division of

- Transnational Corporations
- The Triad ( U.S.A, Japan, E.U.)

- Dependency Theory
- Planning for Development
- The Developmental State
- The Neo-liberal State
- Development Economics
- The future of development

- Foreign Direct Investment
- Factor Payments to Abroad
- The New Economy in

- International Trade

Back to Global Economic Prospects for Developing Countries

--World Investment Reports
---(the complete series)

--World Investment Reports
---(selected statistics)

-- Planning for Development
UNCTAD areas of work:
Globalization and Development
Development of Africa
Least Developed Countries
Landlocked Developing Countries
Small Island Developing States
International Trade and

Services Infrastructure
Investment, Technology and
Enterprise Development

The following databases on-line are available:
Commodity Price Statistics
Foreign Direct Investment
Handbook of Statistics
ICT Statistics
Millennium Indicators

Digital Library:
-- News
-- Main publications
-- UNCTAD Series
-- Basic documents
-- Issues in Brief
-- Newsletters
-- Statistical databases
-- Globalization and
----- Development Strategies

-- Economic Development in
----- Africa

-- International trade
-- Dispute Settlement - Course
----- Modules

-- Investment, Technology and
-----Enterprise Development

-- Services Infrastructure for
--- Development and Trade
----- Efficiency

-- Monographs on Port
----- Management

-- Technical Cooperation
-- Discussion papers
-- G-24 Discussion papers
-- Prebisch Lectures
-- Transnational Corporations
----- Journal

-- Publications Survey 2006-

World indicators on the environment

World Energy Statistics - Time Series

Economic inequality

Other related themes:
- Aid
- Bureaucracy
- Debt
- Decentralization
- Dependency theory
- Development
- Development Economics
- Economic Policies
- Employment/Unemployment
- Foreign Direct Investment
- Gender
- Human Rights
- Human Development
- Hunger
- Inequality/social exclusion
- Informal sector
- Labour Market
- Microfinance
- Migration
- Poverty
- Privatization
- State/Civil Society/

- Sustainable Development
- Transnational Corporations
- Urbanization

- Complete list of development themes

Puro Chile la memoria del pueblo
Proyecto para el Primer Siglo Popular

Sector Informal:
C. Ball: La economía informal
Habilidades y competencias para el sector informal en América Latina: Una revisión de la literatura sobre programas y metodologías de formación, María Antonia Gallart, 2002 (ILO)
Programa IFP/SKILLS (Economía informal ) Capacitación laboral para el sector informal en Colombia - Jaime Ramírez Guerrero, Ginebra, OIT, 2003
Banco Interamericano de Desarrollo

Desarrollo Urbano:

Puro Chile la mémoire du peuple
Projet pour le Premier Siècle Populaire

L'economie informelle en Afrique