Urbanization And Economic Growth In China

Urbanization has become the theme of the global economic development in the 21st century since a country cannot accelerate its economic development without urbanization. Since 1990s, an increasing number of economists have come to the consensus that urbanization accelerates economic growth and economic growth facilitates urbanization. At the end of 1990s, developing countries began to take achieving a high level of urbanization as one of the most important goals in the process of their economic development. Future urbanzation level of China, a developing country with the largest number of people in the world, will have a very profound impact on the global economic development. Under this circumstance, it is of supreme importance to make a comparison between the urbanization process of China and that of other countries, analyze the influence system of urbanization on economic growth and discuss the ways of achieving a harmonious relationship between the urbanization and the development of the economic growth.Based on the former research in urbanization and the economic growth, this dissertation systematically analyzes the inherent relationship between urbanization and the economic growth in our country, probes into the impact of migration flows and industrial structure adjustment on the economic growth and discusses the possible institutional arrangements that will promote a harmonious relationship between the development of economic growth and the urbanization in China.The dissertation includes the following parts:First, the dissertation discusses the interactional systems between urbaniztion and the economic growth and constructs a theoretical model including a rural area and two cities of different types by taking into consideration the dual urban-rural economic structure of China and the facts that cities in China are of significant differences in their urbanizaiton levels and sizes. The model studies the influences of different factors on the economic growth path. The factors discussed include technology, productivity, human capital accumulation, congestion costs, government subsidies and different cities.Second, the dissertation summerizes the features of urbanization worldwide and domestically, and probes into the relationship between urbanization and the economic growth by adopting an empirical analysis. According to the empirical study, there is a long-term and stable relationship between urbanization and the economic growth in our country. The economic growth is a positive Granger cause for urbanization shown by the data of 1978-2009, and urbanization is also a positive Granger cause for the economic growth shown by the data after 1990s. In other words, the relationship between urbanization and the economic growth is interactional.Thirdly, this dissertation analyzes the migration trends in the process of Chinese urbanization and probes into the positive and negative impacts that migration flows have on the economic growth in China. The study concludes that there is a close relationship between migration flows and the process of urbanization and people tend to migrate to cities of bigger sizes. However, a new migration trend appears in recent years, with more people migrating to comparatively smaller cities. That a large number of people migrate to cities help balance the supply and the demand of labor force and promote the readjustment of industrial stucture in cities. However, it increases the administrative costs in the process of urban economic development and imposes a heavy burden on public infrastructure.Fourthly, this dissertation discusses the interrelationship between urbanization and industrial structure adjustment by adopting the quantitative analysis. The study results demonstrate that there is a long-term and stable relationship between urbanization level and the industrial structure. In the process of Chinese urbanization, a large part of rural labor force migrates to cities, promotes the development of the secondary industry and enhances the proportion of the tertiary industry. Unbanization helps pomote the eonomic growth through the readjustment of industrial structure and the realization of industrial optimization.Finally, the dissertation studies the positive and the negative influences of institutional arrangements on the urbanization and the economic growth of China based on the analysis of different institutional arrangements in the process of Chinese urbanization. Then the dissertation brings forward some proposals to promote a harmonious relationship between the urbanization and the economic growth in China.