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Arguments - Intervention Possibilities
Chinese authorities seem to believe that they will be able to control the wave of rural-urban migration that many experts have predicted will follow from the country's rapid economic development. China is certainly in a unique position for a developing country because of its strict household registration system, which is still used for tight control of rural-urban migration. However, in the long run this system will not hold back the migratory flood. Rural-urban migrants will find loopholes in the system, particularly because cheap rural labor is in the economic interest of certain urban industries, such as in the construction sector. It is unlikely that China will be able to combine economic development with a tight control of residential rights. If we take into account the experience of other developing countries, we find a wealth of evidence suggesting that China will not be able to significantly slow urbanization through administrative or coercive measures.
Crucial Issues
Basically, there are two measures that might be applied to slow urbanization in China:
WB00860_.gif (262 bytes) Administrative or coercive measures to prevent rural-urban migration
WB00860_.gif (262 bytes) Measures of regional planning that favor decentralized economic development in China
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Will the strict household registration system prevent rural-urban migration?  
There are signs that an increasing number of rural migrants are trying to find loopholes in the tight system of migration control in China. First, there is a growing number of illegal rural-urban migrants, many of whom live on the street, below bridges, in makeshift shelters, or with friends and relatives - apparently without appropriate registration. Some of them find casual work in the informal sector (e.g., as street peddlers); others engage in criminal activities. When the authorities apprehend them, they are sent back to their villages or rural towns. Second, there is the semi-official "floating population" of workers from rural areas. They are tolerated as long as the urban industries that have hired them have received proper permission from the labor offices. The working migrants are registered with the labor offices and are supposed to stay only temporarily. They usually do not have urban residential status and are still registered as agricultural population in their home village or town. The floating population is estimated to comprise some 80 million people, most of whom have stayed in urban areas for many years. Finally, there are residential committees in certain towns and cities that provide migrants with official urban registration. These migrants can then legally stay in the city. It is not known how many (sons and daughters of) rich farmers have become urban residents in this way.
Of course, these are only the first signs of China's inevitable urbanization. The household registration system is still very effective, because current conditions make it difficult for illegal rural-urban migrants to survive in towns and cities. The extreme shortage and strict state control of housing prevent migrants to rent apartments. Without proper registration migrants do not have access to subsidized food and the education system is not accessible for their children. However, these conditions may change. The private sector might find ways to provide cheap accommodation for rural migrants. There are already signs that farmers along the periphery of towns and cities are renting rooms in their houses to migrants. 
In conclusion, we can expect that the strict control of migration in China through the household registration system will slow urbanization somewhat. China probably will not experience the same urban explosion as has been seen in some developing countries in Latin America (Mexico City) and Asia (Jakarta). However, China cannot prevent the process of urbanization, because economic development will inevitably shift labor demand from agriculture to the (urban) industrial and service sectors. The question is not: Will China remain a rural or become an urban society? The question is: What type of urbanization can we expect in China?
How can China control the urbanization process?  
Many developing countries have tried to slow urbanization; most have failed miserably. Mexico, for instance, attempted to establish regional centers in the 1970s and 1980s to prevent the increasing population concentration in Mexico City, with very little success. Indonesia implemented an ambitious Transmigrasi program that was originally intended to lower population pressure on the central island of Java by initiating economic development in rural areas on the "outer" islands of Sumatra, Kalimantan, and Sulawesi. It soon became obvious that the transmigration program could not achieve this objective. However, it is not only developing countries that have failed to prevent urban concentration - advanced industrial societies have been equally unsuccessful. The European Union is pumping billions of Euros into the rural areas of Europe, especially into peripheral agricultural regions of France, Spain, Greece, and Italy. This has not prevented a steep population decline in these areas. Europe's population is moving into the urban-industrial centers, despite massive subsidies that should improve living conditions in those rural regions. The same trend is documented for the USA, where for many years the rural "heartland" has been losing population to the heavily urbanized coastal states.
The Chinese government and many Chinese scholars seem to believe that it will be possible to prevent the rapid growth of urban agglomerations in the coastal provinces of China by promoting economic development in smaller towns and cities in rural areas in the central provinces. The chances that this concept of regional development will succeed are slim, as the examples above indicate. Modern industries and service sectors need the cumulative location advantage that only urban agglomerations can provide, such as good road, rail, sea, and air transportation infrastructure, high-capacity communication lines, and adequate housing, consumption and education facilities for the labor force. What China needs is an urban development plan that will project and build the necessary infrastructure (housing, public transport; and  sewage, water supply, and waste disposal systems) before the wave of rural-urban migrants suffocate the existing urban agglomerations in the coastal provinces of eastern and southern China.
Related Arguments

Urbanization:   Trends     Impact    Data Quality    Prediction Error    Intervention Possibilities    Intervention Costs

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Revision 2.0 (First revision published in 1999)  - Copyright 2011 by Gerhard K. Heilig. All rights reserved. (First revision: Copyright 1999 by IIASA.)