Urbanization - Economic Effects

Economic Effects

As cities develop, effects can include a dramatic increase and change in costs, often pricing the local working class out of the market, including such functionaries as employees of the local municipalities. For example, Eric Hobsbawm's book The age of revolution: 1789–1848 (published 1962 and 2005) chapter 11, stated "Urban development in our period was a gigantic process of class segregation, which pushed the new labouring poor into great morasses of misery outside the centres of government and business and the newly specialised residential areas of the bourgeoisie. The almost universal European division into a 'good' west end and a 'poor' east end of large cities developed in this period." This is likely due the prevailing south-west wind which carries coal smoke and other airborne pollutants downwind, making the western edges of towns preferable to the eastern ones. Similar problems now affect the developing world, rising inequality resulting from rapid urbanization trends. The drive for rapid urban growth and often efficiency can lead to less equitable urban development, think tanks such as the Overseas Development Institute have even proposed policies that encourage labour intensive growth as a means of absorbing the influx of low skilled and unskilled labour. Urban problems, along with infrastructure developments, are also fueling suburbanisation trends in developing nations, though the trend for core cities in said nations tends to continue to become ever denser.

Urbanization is often viewed as a negative trend, but there are positives in the reduction of expenses in commuting and transportation while improving opportunities for jobs, education, housing, and transportation. Living in cities permits individuals and families to take advantage of the opportunities of proximity and diversity. While cities certainly have a larger variety of markets and goods than rural areas, infrastructure congestion, monopolisation, high overhead costs, and inconvenience of cross town trips team up to make marketplace competition as often as not worse in cities than in rural areas.