ABSTRACT
Asia is densely populated and home to most of the world's megacities. However, its urban primacy and urban concentration, especially those of developing Asia, are much lower than their counterparts in the rest of the world. This is an important puzzle that has not been addressed in the literature. Motivated by a theory of Krugman and Livas Elizondo, this paper attributes the lower urban concentration and urban primacy to higher levels of trade openness in Asia. Empirical evidences are provided using panel data from developing countries in Asia, from the rest of the developing world, and from China.
Acknowledgments
Our thanks go to the anonymous reviewers for their valuable comments.
Disclosure statement
No potential conflict of interest was reported by the authors.
Notes
1. Urban primacy is defined as the share of the population in the biggest city to the national total urban population.
2. Urban concentration is defined as the share of population in cities with more than one million population to the national total urban population.
3. When computing the urban concentration and urban primacy, we drop those economies whose total population in 2014 is less than 1 million, and city states of Singapore, Monaco and Hong Kong.
4. Trade openness is measured by the ratio of the import and export to GDP.
5. The reason that why we employ developing panel countries outside of Asia and in Asia respectively to test the effect of trade openness on urban concentration and urban primacy is that, we want to show that the negative effect of trade openness not only applies to Asian developing economies, but also applies to those developing economies outside of Asia.
6. The same model specification is applied to regressions on urban primacy.
7. Variable ‘trade’ may suffer endogenous problem in these models. This issue is addressed in Section 3.5.
8. Variable ‘trade’ may suffer endogenous problem in these models. This issue is addressed in Section 3.5.
9. For continental countries, the rule for determining neighbor countries is having common borders; for an island country, we choose three to four countries that are nearest to the island country.
10. Results of robustness check can be available to readers upon request.
11. 1 USD = 6.69 CNY (20/07/2016).
12. Correlation index between them is −0.334.
13. Correlation coefficient between them is −0.72.
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Notes on contributors
Guanghua Wan
Guanghua Wan is a director of research, Asian Development Bank Institute, Tokyo, Japan. His research interests are poverty, inequality and economic development. He has recently published articles on structural change and income distribution in China and on the growth and distributive impacts on infrastructure investment in China.
Dan Yang
Dan Yang is an associate professor, College of Economics and Management, Southwest University, Chongqing, PRC.
Yuan Zhang
Yuan Zhang is a professor, China Center for Economic Studies, Fudan University, Shanghai, PRC, and Fudan-Guangxi Research Institute of Maritime Silk Road and Regional Development of Guangxi, Guangxi University of Finance and Economics, Nanning, PRC.