The Limits to Urban Growth: Suggestions for Macromodeling Third World Economies.

These city growth projections are based on models which fail to allow for the potential feedback of various city costs on the rural-urban migration decision. In addition, detailed analyses of Third World cities by urban economists and planners conventionally take in-migration as exogenously given. It is our view that the debate can be better informed by the application of general equilibrium models of Third World development which include some of the potential costs of urbanization—models which at least make an effort to internalize the most important of various alleged costs so that potential "natural limits" to urban growth can be evaluated and the relevance of UN forecasts assessed. Section II illustrates how existing macro models of the Third World are "pro-urban" biased: typically they minimize the potential limits to urban growth and are silent on the issue of overurbanization. Section III lists some key forces which might serve to retard the rate of urbanization. Section IV develops this theme at length by offering some explicit suggestions on how these forces might be introduced into a general equilibrium model of Third World development. Central to this discussion will be potential cost-of-living differentials between urban and rural areas, urban housing availability, the quality of urban public goods, urban land scarcity, modern sector factor requirements and resource "bottlenecks," and the competing demands of "unproductive" urban capital accumulation. While no conclusive results are offered in the present paper, it seems to us timely nevertheless to open the debate on strategies for macromodeling the "limits to urban growth" in Third World economies. [ABSTRACT FROM AUTHOR]