Deck 7: Urbanization and Ruralurban Migration: Theory and Policy  

Question 1

Explain why policies designed to reduce urban unemployment may not greatly reduce poverty in developing countries.

Answer 1

They may lead to more migration, and may draw capital away from labor-intensive rural development projects that may benefit the rural poor.

Question 2

Why is urban giantism less prevalent in mature democracies?

Answer 2

The student is asked to draw on the political economy explanation whereby autocratic regimes must satisfy the demands of the urban masses to avoid political unrest (the Ades and Glaeser argument).

Question 3

How could the removal of labor market distortions increase employment even if the elasticity of factor substitution is very low?

Answer 3

Reduce speculative rural-urban migration based on expected wages as in the Todaro model.

Question 4

Other things constant, the elimination of factor price distortions in developing countries would?most likely

A)decrease rural-urban migration.
B)have little effect on rural-urban migration.
C)increase rural-urban migration.
D) increase urbanization.

Question 5

An argument supporting promotion of the urban informal sector is

A)the formal sector is incapable of providing enough employment.
B)informal sector workers are poorly educated.
C)it uses a relatively high capital intensity.
D) it would reduce urban bias.

Question 6

What are the characteristics of those who migrate to urban areas? What positive and negative effects does their leaving have on those who remain?

Question 7

Discuss the importance of rural-urban migration as a source of urban population growth in various parts of the developing world, being as specific as you can.

Question 8

Are developing-country cities too large, too small, or about right in size? Justify your answer with evidence from developing economies.

Question 9

Even though women often constitute the majority of the rural-urban migrants in a country, they usually still remain employed in the informal sector. Why? What are the consequences of this?

Question 10

The informal sector exhibits

A)free entry.
B)labor intensive methods.
C)small, competitive firms.
D) all of the above.

Question 11

What are the main features of the Harris-Todaro model of rural-urban migration?

Question 12

Explain some important policy measures that you would expect to reduce excessive rural-urban migration. Explain.

Question 13

If the rural wage is 4 and the formal urban wage rate is 10, there will be rural to urban migration if the formal urban unemployment rate is

A)50%.
B)60%.
C)70%.
D) all of the above.

Question 14

Suppose the rural wage is $1 per day. Urban modern sector employment can be obtained with 0.5 probability and pays $2 per day. Will there be any rural-urban migration? Explain your reasoning, stating explicitly any simplifying assumptions, and show all work.

Question 15

Describe some of the causes of urban giantism in developing countries.

Question 16

Rural-urban migrants differ from the rest of the rural population in that they are more likely to be

A)well educated.
B)poor.
C)female.
D) All of the above.

Question 17

Point out the main differences in job conditions and worker characteristics between the urban formal and informal sectors.

Question 18

Suppose that, for example, in India, a minimum wage is instituted in the modern sector above the market-clearing wage, while the rural traditional wage is market determined at a lower level than in the modern sector.
a.Describe the impact of this policy on the rural labor force, urban unemployment, and the rural wage.
b.Will the modern-sector wage be equal to the traditional-sector wage after markets equilibrate through migration? Explain.
c.What effect might moving costs have on the equilibrium you described in Part (b)?
d. What effect might the introduction of factories to rural areas have on the equilibrium you described in Part (b)?

Question 19

Describe some of the benefits and costs associated with the emergence of large cities in developing countries.

Question 20

Explain what is meant by urban bias. What are the major effects of urban bias?

Question 21

For what percentage of urban population growth is rural-urban migration responsible?

A)Between 30% and 60%
B)Between 40% and 80%
C)Between 50% and 70%
D) Between 50% and 90%

Question 22

According to the United Nations Millennium Development Goals Report, the annual growth in percentage terms of the slum population from 1990-2001 has been the largest in:

A)Latin America and the Carribean
B)South-East Asia
C)Sub-Saharan Africa
D) Southern Asia

Question 23

According to UN projections, what proportion of the world's urban population will reside in the urban areas of developing countries by 2025?

A)Two fifths
B)One half
C)Two thirds
D) Four fifths