Economic Growth Strategy and Urbanization Policies in China, 1949-1982.

The article comments on economic growth strategy and urbanization policies in China. Urbanization in the early stage of industrialization is, in essence, the spatial manifestation of the economic structural transformation, characterized by a massive shift of labor and other inputs away from agricultural to non-agricultural activities in the production structure. China's rapid industrial growth has not been accompanied by comparable levels of urbanization, which remains low even by third world standards. The article outlines the major principles governing urbanization in the early stages of socialist industrialization and demonstrates that China has been consistent in attempting to maximize industrial growth while minimizing urbanization, through measures such as control of urban-rural population and labor mobility, fuller use of urban workers, the suppression of services and personal consumption, and the promotion of rural industrialization. The heavy emphasis on rapid industrial output expansion inevitably generates high growth of industrial employment, especially during the early years of extensive growth. This creates a strong tendency to agglomeration and urbanization. At the same time, under the SGS, the wide gaps in wages, consumption or economic opportunity between the industrial and agricultural sectors are maintained. There are immense incentives for peasants to out-migrate from rural areas because state policies towards agriculture, including the collectivization and compulsory delivery of agricultural goods, are mostly unfavorable to the farm sector and therefore create a strong push for migration.