Urbanization of Villages Within Cities

Published on Author shue

In the next decade, China’s new leadership aims to expand the urbanization of its cities through an estimated $6 trillion injection in infrastructure, which includes housing, to support urban migration. Its efforts are directed at eradicating “villages within cities,” clearing out old shipping containers that currently offer affordable private housing near urban areas such as Shanghai to migrants. However, this poses a dilemma in that the government is clearing out cheap neighborhoods for more expensive, urbanized, government-owned housing for migrants who cannot afford and own it. Many migrants who make a living with very small margins may need to rethink their decision to stay in the cities. Though in the next two years, the city of Beijing is prepared to rent out city-built housing units to migrants, the possibility that migrants may not qualify for it is real. Furthermore, it is highly likely that government-built housing will not equal to the amount of those displaced as a result of urbanization.

Given that cheap private housing helped keep migrant labor costs low, what are the potential consequences that may follow government housing? Due to the difficulties that are likely to follow urbanization, such as lower rates of migration, is it likely that the government may rethink its national registration system so that citizens and their public benefits are not tied to their hometowns?

Source: Reuters

2 Responses to Urbanization of Villages Within Cities

  1. This recently happened in Washington D.C. in the name of urbanization and infrastructure investment, the poverty gets forced out of the city, whose consequences are vast.

  2. There is a margin for adjustment, “slum” housing in which older housing gets subdivided into smaller residences (perhaps with shared lavatories but separate kitchens). So what happens depends on whether property owners face holding costs (in the US, real estate taxes) that encourage them to get income from their properties. At the moment, there may be no out-of-pocket cost to keeping an apartment empty. Tenancy law, de facto or de jure, also matters. I know that outlying villages often became migrant slum dwellings, but the ability to do this may vary from city to city, depending on the stance of local officials.