We’ve all experienced the inevitable logjam that results from entering the city, whether it’s New York or Los Angeles. We’ve pulled off the freeway, slowed to a crawl in the exit lane, and sat back for a long wait, as the traffic bottlenecks. And the closer we are to the stunning skyscrapers and bustling boulevards, the denser the logjam. Rush hour never ends in the city. But why? Why do hundreds of thousands of people pour in to these areas every day? And what does it mean for today’s world? Although several factors push people to move to cities, an overarching theme among them is the desire for a modern way of life. Workers come in search of employment opportunities in burgeoning sectors like services and technology that are less abundant in small towns and rural areas. Cities also tend to be more politically and socially progressive, due to greater accountability and cultural diversity. New York, for example, is a leader in “open data,” an urban policy that grants citizens access to a trove of information about the day-to-day operations of public services and government programs within the city. People – certainly young adults, who embody those flocking to the city – are attracted to this dynamism.
According to the United Nations, approximately 4 billion people, or 54 percent of the global population, now live in urban areas. This number is projected to rise to nearly two-thirds of the global population by 2050, with most of the growth occurring in developing countries. Of the 4 billion today, 1 in 8 live in so-called “mega-cities” of over 10 million inhabitants, such as Tokyo, Delhi, Shanghai, and Mexico City. The world is urbanizing faster than ever before.
As demographic power shifts towards cities, economic power is moving in the same direction. Cities account for over 80 percent of world GDP and are central to economic development. Not only do they benefit from large pools of consumers and talent, but they concentrate government, financial capital, and transportation and utilities infrastructure. This concentration helps to lower transaction costs and create networks conducive to innovation. The enhanced productivity of cities can drive growth and raise a country’s standards of living, including life in rural areas. They are also associated with lower fertility, a crucial aspect of the transition from “developing” to “developed.”
However, not all cities are equally effective, nor are all inhabitants within a city equally well-off. On the contrary, cities are often known for stark income inequality. For every high-rise, there may be ten who are homeless or barely sheltered on the fringe; for every limousine and luxury boutique, there may be twenty who are struggling to pay bills on minimum-wage jobs. Indeed, cities often have vast informal economies in which workers earn much less than the minimum wage and cannot expect any stable income. These workers, especially women, are highly vulnerable to poverty traps. The disparity between the very wealthy and the extremely poor in cities is nowhere as apparent as in the slums, or informal settlements of the indigent. Here, crowding, unsanitary conditions, crime, and lack of access to utilities, healthcare, and education prevail. As population density increases, it becomes harder and harder to scale and share these resources among more people.
The challenges to sustainability explain why megacities, despite their rapid rise and distinct advantages for economic growth, are not considered the ideal destinations for those seeking to relocate. Every year, the Economist Intelligence Unit ranks cities around the world by “liveability,” or a combination of their stability (safety), healthcare, education, infrastructure, and environment. At the top of the list are “mid-sized cities in wealthier countries with a relatively low population density,” rather than seemingly obvious world-class candidate cities like London.
Fortunately, deliberate urban planning can bring cities of all sizes closer to their economic and social potential. The World Bank, one of many institutions to take on research in urban planning, is developing strategies focused on building affordable housing and climate-friendly infrastructure. The ability of governments to address these priorities and implement solutions will shape the future of cities – and in our increasingly urban world, our future as well.
This blog post was written by Eleanor Tsai.