Determinants of urbanization in low-income nations: A multi-theoretical approach

This study examines the effect of several indicators of developmentalist/ecology, dependency/world-system and urban bias perspectives on the problems of urbanization and overurbanization using a sample of sixty-five low income countries. These indicators are used simultaneously in a test using structural equation modeling with LISREL. A path diagram provides the structure in which developmentalist/ecology is represented by the concepts rural adversity, economic development, and population growth; urban bias is represented by rural-urban disparity. Dependency/world system is represented by foreign investment and debt.;The problem of urbanization was analyzed using two sets of stacked submodels. In these models economic development increases urbanization while rural adversity increases urbanization when the variable gini coefficient of sectoral inequality is used in the model. Rural-urban disparity, however, does not increase urbanization. Foreign investment shows a short term direct negative effect on urbanization and indirect positive effect through economic development as well as accumulated indirect effect through indirect paths.;The problem of overurbanization was analyzed using two sets of stacked submodels. In these models, economic development increases overurbanization but only in the short run (1975) while rural adversity (gini coefficient) swell overurbanization in the long run (1975-1985). Rural-urban disparity does not increases overurbanization. Foreign investment has both direct and indirect effects (through economic development) on overurbanization. Population growth and debt show no significant effects on urbanization or overurbanization.;The study concludes with support for the developmentalist/ecology theory. Urban Bias theory however, is not supported while dependency/world system theory is only partly supported. Finally, dependency/word system factors influence urbanization by influencing economic development and through combined effect of indirect paths.