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Presentation

2nd Revision

Introduction

 
Arguments - Trends
Urbanization
China is still a predominantly rural society. In 1997, only some 30% of the population lived in urban areas. Since the foundation of the People's Republic of China, the government has strictly controlled internal migration, especially between rural and urban areas. Only since the beginning of economic reforms in 1978 have these restrictions been relaxed because of the demand for unskilled labor in booming cities and towns. In recent years, there has been a wave of temporary rural-urban labor migration, called the "floating population."
Short Description of the Problem
While the great majority of people in China still live in rural areas, rapid urbanization is predicted by many experts. To understand China’s urbanization process, the following questions have to be answered:
WB00860_.gif (262 bytes) What are the current trends of urbanization and rural-urban migration?
WB00860_.gif (262 bytes) Is there a clear pattern in (interprovincial) migration?
WB00860_.gif (262 bytes) Will the floating population really float back?
WB00860_.gif (262 bytes) Why has China remained a rural society for so long?
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Discussion
Current trends in urban growth Tables & Charts
According to official statistics, China’s urban population was about 72 million in 1952; in 1997 it was estimated at 370 million (see Table 1). China’s urban population has more than quadrupled since the early 1950s, whereas its rural population has only increased from 503 to 866 million. Despite this enormous increase in urban population, China has essentially remained a rural society. More than two-thirds (70%) of the population is still classified as rural.
The UN Population Division has been monitoring city populations around the world for many decades. For China, they have population data for the 51 largest cities and urban agglomerations (United Nations 1995). According to the UN estimates, which are based on Chinese reports, these cities had a total population of about 39 million in 1950. Today, their population is some 134 million.
Although these statistics on population increase in urban areas and cities are frequently used to document China's urbanization, they only provide a rather crude and incomplete picture of reality. We cannot understand urbanization trends in China without analyzing at least some aspects of the statistical, administrative, and political background, which in Chinas is completely different than in most other developing countries (see the discussion on data problems.).
Urban & Rural Population in China, 1952 - 1997
Table 1
Interprovincial migration
There is significant migration from rural hinterlands in central China to the booming coastal provinces. For instance, between 1985 and 1990, Guangdong and five other coastal provinces - Beijing, Shanghai, Liaoning, Tianjin, and Jiangsu - had significant net-immigration. Together, these six economically booming provinces had a net population gain from interprovincial migration of 2.7 million (see Table 2). These results are from the interprovincial migration matrix of China, based on retrospective questions in the 1990 census.
The clear "winner" is Guangdong: between 1985 and 1990, some 1.26 million people moved from other Chinese provinces to this province, which is a center of modernization and industrialization. Only 250,000 people left Guangdong for other provinces. The obvious "loser" is the agricultural province of Sichuan, which had a net loss of more than 846,000 people to other Chinese provinces between 1985 and 1990. Net losses of population due to migration were also reported for Guangxi, Zhejiang, Hunan, Heilongjiang, Anhui, and Hebei - all provinces with large agricultural sectors and low economic growth.
It is important to understand the relevance of these statistics. They merely indicate the official inter-provincial migration within a five-year period, which is small compared with the actual population movements. It is known that China has a large number of temporary migrants who leave rural areas to work in the booming cities. This "floating population" does not have official permission for permanent residence in the town or city. It is estimated that Beijing and Shanghai each have a floating population of 2-3 million people.
Migration between Provinces
Table 2
Floating population
As a result of the economic reforms since 1978, productivity significantly increased in China's agriculture. The number of small tractors rose almost eight-fold, and the number of small trucks for agricultural use "exploded" from 74 to 876 thousand. The application rate for chemical fertilizers increased from 58.9 kg per hectare in 1978 to 213.3 kg per hectare in 1993 (see the discussion about agricultural technology). Average grain yields grew from about 2.5 tons per hectare in 1978 to some 4.1 tons per hectare in 1993. This mechanization and modernization of Chinas agriculture created a huge excess labor force. Millions of farmers now live on very small pieces of land that are sufficient to survive, but too small for modern agricultural production. China's huge rural population is linked to an economic activity, which could be accomplished by a fraction of the current agricultural labor force. In fact, it was estimated that in 1994 China had a surplus of about 200 million agricultural workers. Chinese experts have estimated that by the year 2000 some 300 million farmers will not be needed in agriculture (Poston, D. L. / Duan, C. C, 1999). If this number is correct, then China's rural under- or unemployed would outnumber the total population of the United States of America.
In the course of China's economic reforms some agricultural surplus population was absorbed in the flourishing rural industries and moved to industrial centers and towns nearby. However, millions of farmers sent their sons and daughters to the big cities, hoping they could find jobs and participate in China's economic miracle. In the 1980s and 1990s China experienced a dramatic increase in rural-urban migration. Experts have estimated that by 1984 the migrants numbered more than 20 million; by 1993 their number had increased to 60 million; and by 1995 there were probably more than 80 million rural-urban migrants in China's major cities (Roberts, K. D. 1997). This would be one of the largest flows of labor migration in history.
Some information on migration flows can be extracted from a sample survey, which compared the place of residence with the place of household registration. As can be seen in Table 3, the survey included 1.24 million people. Some 1.17 million of these people actually lived in the township, town, or sub-district, where they were registered. Some 69,300 people, however, were not registered where they lived, but in some other township, town, or subdistrict. In Beijing and Shanghai, however, the percentage of people who did not live where they were registered was much higher. In 1997, some 16.5% and 13.3% of the population in these cities was registered outside the city.
Officially, the rural laborers working in cities and towns are considered only temporary migrants - in China called "floating population" (liudong renkou). The authorities believe to be able to control this rural-urban migration flow with a strict household registration system (hokou). The floaters, however, might have second thoughts, and it is unclear how many of them will actually return to their villages. In all major cities of China one can find well established residential districts with predominantly "floating population" - sometimes they are living there for more than 10 years.
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Table 3
Why has China remained a rural society for so long?
China has long been the prototype of a rural society. Historically, China's towns and cities were administrative, political, and cultural centers from which a small elite controlled (and often exploited) the huge majority of farmers. After 1949, the government’s closed-city policy effectively prevented urbanization. In the 1950s, 1960s, and 1970s, China's government strictly controlled population mobility. An individual's place of residence was (and still is) essentially determined by his or her function in the labor force: the population working in agriculture is defined as rural population, no matter where they live; nonagricultural population is classified as urban and has significant social and economic privileges.  
It is impossible to understand China's recent trends in urbanization and internal migration without taking into account the country's unique household registration system (or haiku). In principle, each individual in a household must be registered with a committee. In rural areas, these committees are called villagers committees, in urban areas they are called residents committees. This registration not only documents the place of residence, it also classifies the household by function. This functional classification determines the individual's social and economic rights and privileges.  Each household is classified either as agricultural or as nonagricultural. The villagers committees automatically classify their residents as agricultural, while the residents committees in cities and towns can assign the status of urban resident. Only urban residents are entitled to receive state-supplied grain and other subsidized food, and only urban residents can get into state-controlled urban housing. By assigning the urban residents status, the administration can essentially control migration and assign economic and social privileges.  
In the pre-reform period, farmers had little or no chance of moving into industrial or service sectors of urban areas. Prior to the late 1970s, it was primarily the reclassification of existing townships into towns that fueled urbanization. At that time, the cities and towns primarily grew by natural population growth, not by rural-urban migration. When the economic reforms began in 1978, China was still a predominantly rural society. The rapid economic transition during the 1980s and 1990s, however, changed this situation. Industries in rural areas were built up and attracted workers from the agricultural labor force. The village industries triggered a process of "rural urbanization" in China. Towns and small provincial cities in close proximity to industrial sites grew rapidly, and many rural townships had to be reclassified as towns and cities. During that phase of development, some villages or rural towns with fast-growing industries multiplied their population within a few years. The population of Senshen, on the border with Hong Kong, "exploded" from a few thousand to a few million.  
But there was also an increase of population in the existing urban agglomerates in the coastal provinces and special development zones. The provincial capitals, such as Beijing and Shanghai, in particular, required additional labor in the construction industry. Temporary labor migration to these cities was tolerated or even promoted, and a certain amount of household reclassification from agricultural to nonagricultural status was allowed. Today, Beijing and Shanghai have "floating populations" of between 2 and 3 million people each. Powerful pull and push factors will generate further rural-urban migration. While an individual's official place of residence is still controlled by the Chinese administration through the strict household registration system, it is obvious that the controls have been loosened.  
While the household registration system is certainly of primary importance for China's urbanization trends, other factors must be considered as well. There is, for instance, a history of aversion to the agricultural population on the part of  urban intellectuals and bureaucrats. This "closed city mentality" is deeply rooted in Chinese culture. Urban Chinese often look down on the farmers, whom they consider filthy, uneducated, and lacking in culture. The "Western" concepts of social mobility and freedom to choose one's place of residence are not overly popular among Chinese intellectuals. Newspapers in China often refer to members of the floating population as "criminals," even if their only "crime" is to demand the same privileges as urban residents. Residents of Beijing can be often heard complaining about the "floaters," whom they consider to be responsible for traffic congestion, housing shortage, competition on the labor market, increasing crime, and other recent negative developments in city life. Among the urban population in China, there is certainly great support for government policies to slow urbanization.
However, there are good economic reasons to believe that even if China’s government tries to maintain restrictions on spatial mobility, massive rural-urban migration and city growth cannot be stopped. Three factors are currently driving rural-urban migration in China: (a) the widening income gap between rural and urban areas (see Figure 1); (b) the increasing labor demand in certain economic sectors of the big cities. For instance, there is a demand for unskilled labor in the urban construction industry; the electronics and textile industries employ many female workers at low wages; the service sector (such as restaurants, transportation, and retail markets) also need unskilled labor; and there is a demand for household servants among dual-career urban residents; and (c) the further agricultural modernization, which inevitably increases the agricultural labor surplus.
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Figure 1
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.)