Spatial inequality refers to the unequal distribution of income and resources across geographical regions. [1] Attributable to local differences in infrastructure, [2] geographical features (presence of mountains, coastlines, particular climates, etc.) and economies of agglomeration, [3] such inequality remains central to public policy discussions regarding economic inequality more broadly. [1]
Whilst jobs located in urban areas tend to have higher nominal wages (unadjusted for differences in price levels or inflation) than rural areas, the cost-of-living and availability of skilled work correlates to regional divergences in real income and output. [3] Additionally, the spatial component of public infrastructure affects access to quality healthcare and education (key elements of human capital and worker productivity, which directly impacts economic well-being). [4]
Variation in both natural resource composition and quality of regional infrastructure are traditionally considered to be motivating factors for migration patterns between urban cities and rural areas. [5] This, in turn, impacts the concentration of specific industries and sectors within a given area, as well as the investment choices made by local governments, thus perpetuating spatially-based disparities. [5] However, there remain significant challenges in carrying out empirical research to quantify these disparities (particularly within a given nation, as opposed to across different nations), due to lack of region-specific datasets, [6] [7] the level of geographical disaggregation required to reveal such trends, [8] as well as the inherent differences in incomes and living costs across different communities. [3] [9]
The relationship between population density and productivity is a significant factor affecting the difference in economic capital, cultural capital, and social capital found between cities and rural areas. [10] In particular, the clustering of agriculture activities versus manufacturing activities informs much of the urban-rural wage gap, as industrial jobs tend to earn higher wages than their counterparts in the agricultural sector. [5] The rate at which this clustering of jobs occurs provides a partial explanation as to why different communities undergo urbanization at different rates. [5] From this, the theory of the core-periphery model in urban economics suggests that manufacturing tends to form the "core" of an industrial cluster, with agricultural activity tending to take place on the "periphery" of such urban formations. [11] This affects the organizational set-up of linkages throughout supply chains, as agricultural goods and resources (directly outputted from agricultural processes) are then transported inwards towards the urbanized center of the region. [11] Such patterns permit greater economies of scale to be realized, as different economic activities become concentrated in regions that are best suited for such work, [11] and transportation costs can be reduced accordingly. [11]
Agglomeration economies refer to the benefits gained from such industrial clustering and city-formation. [12] With the observed savings in transportation costs from this phenomenon being central to the study of economic geography, [12] [11] the positive externalities (indirect benefits gained from third-party activities) afforded by such urbanization (and the mechanisms by which they occur) remain to be of interest for academic studies and public policy considerations. [12]
Population concentration and the clustering of particular industries also allows for the pooling of workers, which results in local business needs and workers' specific skillsets becoming better aligned. [11] Such specialization also allows for knowledge spillovers and greater exchange of ideas, as similar firms can more easily and dynamically interact with one another. [11] This can assist in gaining a comparative advantage with respect to a particular industry or sector, which can be especially beneficial for realizing gains from trade when interacting with other communities and regions which are not as specialized, thus resulting in more geography-based disparities in economic activity. [11]
Natural resource availability affects industry prevalence, as economic activities which are heavily dependent on specific natural resources tend to cluster around suitable geographical regions and climates. [1]
Localities which have a heavy reliance on agricultural jobs require favorable climate conditions for crop production and harvesting. [13] For instance, empirical evidence from Ghana points towards the impact of such spatial inequities on the quality of natural resources available. [13] Although employment in the northern regions of the nation is heavily reliant on the agricultural sector, there is limited access to irrigation and modern implements needed for efficient farming. [13] Such unsustainable farming practices have led to natural resource depreciation over time, including lower quality of soil and higher rates of erosion, which in turn impacts the region's ability to continue engaging in future crop production. [13] In addition, in the face of erratic weather patterns, global warming, and climate change, these challenges have been exacerbated by distorted rainfall patterns and increasingly frequent crop failures. [13]
The resource curse theory suggests that an over-reliance of employment on abundance of natural resources (including forestry, fossil fuels, mineral deposits, etc.) can lead to instability and volatile prices. [5] However, the exogenously determined geographical features of the area directly determines the region's ability to produce traditional agricultural goods and exports. [5] Therefore, such externally determined geographical and climate features informs the composition of employment in the region. [5]
Regions with access to strong transportation networks (including highways, railways, airports etc.) are more likely to benefit from external trade in comparison to remote regions. [5] As transportation costs and logistics inform much of the clustering of economic activity within a region, [12] the geographical concentration of particular industries informs the extent to which particular physical infrastructures must be developed and invested in to support the needs of specific localities. [4]
Social infrastructural components, which impact health and education standards (hospitals, schools, public libraries, etc.) additionally influence quality-of-life conditions and the well-being of workers, and thus their choices with respect to selecting regions/ communities to live in. [4] As such, city planning and the provision of public infrastructure and services remains essential to public policy considerations for rapidly urbanizing communities. [15]
In particular, people living in regions with poor infrastructure and public services are at a greater risk of poor health and wellbeing. [16] This includes limited access to both healthcare, as well as quality and nutritious food. [16] Such impacts compound over time, leaving individuals to become more susceptible to future health problems and illnesses. [16] For instance, the spatial patterns of such environmental factors and hospital accessibility can impact public health outcomes, such as COVID-19 infection, spread, and mortality rates within a nation. [16]
Furthermore, as families of similar incomes tend to cluster, further segregation of socio-economic classes is propagated by schooling environments. [9] This adversely effects the opportunities available to children from low-income backgrounds, and reduces the ability for social mobility needed to escape the poverty trap and generational poverty. [9] [14] An example of this phenomenon in the United States includes redlining - a racially discriminatory historical practice, which resulted in subprime mortgages becoming highly concentrated to specific neighborhoods and geographies. [14]
As different communities may not have similar comparative advantage due to variations in natural resource composition and abundance, foreign trade and globalization are thought to play a key role in influencing spatial inequality as well. [5] In particular, economies undergoing rapid trade liberalization have been observed to actually have increases in poverty rates and income inequality, in spite of nation-wide benefits of economic growth being realized, as urban-rural gaps tend to widen. [1] Additionally, migration patterns from rural to urban areas in developing nations are observed to be a labor market adjustment to an increasing shift in importance from agriculture to manufacturing. [7]
There remains no academic consensus on whether trends in spatial inequalities over time are causes of region-based differences in income, or rather the symptoms of other socio-economic disparities. [17] Furthermore, the complex and intertwined relationships between geographical features, urbanization, availability of infrastructure, and access to public resources further complicates empirical research. [17]
The distribution of income within a nation can first be nominally estimated from local datasets, and then subsequently adjusted to account for regional differences in price levels. [6] Such a procedure allows for comparisons to be made in real-terms and across different localities, [6] which is especially pertinent when national-level inequalities are mostly influenced by regional disparities in income and cost of living. [8] However, the level of disaggregation (granularity of geo-spatial units considered) and the number of localities selected for comparison varies across academic studies. [8] For instance, geographic sub-groups can be considered at the state level, as an urban/rural divide, or even within-component (differences between households belonging to the same group or community). [18] Typical econometric studies will then design and use regression models to analyze the effects of density, industry location, or related variables on regional differences in output or costs. [6] [8] [4]
While nominal wages tend to be higher in cities and urban regions, the same is not necessarily true of real wages, as rising housing costs and expenses tend to offset these benefits. [3]
The availability and reliability of local data remains a barrier to accurate estimation in academic studies. [6] [8] The typical limitations of econometric studies may also impact the soundness of empirical results and conclusions. As such, there remains no unified theory within economic geography to provide a broadly accepted causal explanation for spatial inequality. [5]
In particular, an inherent difficulty in comparing urban and rural regions is the vast disparity in quality and variety of goods and services enjoyed by the typical household in either type of community. [3] Furthermore, differences in disposable income and composition of spending pose further challenges to comparative approaches. [9]
Whist the Gini coefficient and Theil index remain as popular income inequality metrics, these summary statistics do not allow for the decomposition of inequality into multiple dimensions, and thus are insufficient for the multi-faceted analysis required to study spatially dependent inequalities. [4]
Regional science is a field of the social sciences concerned with analytical approaches to problems that are specifically urban, rural, or regional. Topics in regional science include, but are not limited to location theory or spatial economics, location modeling, transportation, migration analysis, land use and urban development, interindustry analysis, environmental and ecological analysis, resource management, urban and regional policy analysis, geographical information systems, and spatial data analysis. In the broadest sense, any social science analysis that has a spatial dimension is embraced by regional scientists.
Urbanization is the population shift from rural to urban areas, the corresponding decrease in the proportion of people living in rural areas, and the ways in which societies adapt to this change. It can also mean population growth in urban areas instead of rural ones. It is predominantly the process by which towns and cities are formed and become larger as more people begin living and working in central areas.
Economic geography is the subfield of human geography which studies economic activity and factors affecting them. It can also be considered a subfield or method in economics. There are four branches of economic geography.
In general, a rural area or a countryside is a geographic area that is located outside towns and cities. Typical rural areas have a low population density and small settlements. Agricultural areas and areas with forestry typically are described as rural. Different countries have varying definitions of rural for statistical and administrative purposes.
One of the major subfields of urban economics, economies of agglomeration explains, in broad terms, how urban agglomeration occurs in locations where cost savings can naturally arise. This term is most often discussed in terms of economic firm productivity. However, agglomeration effects also explain some social phenomenon, such as large proportions of the population being clustered in cities and major urban centres. Similar to economies of scale, the costs and benefits of agglomerating increase the larger the agglomerated urban cluster becomes. Several prominent examples of where agglomeration has brought together firms of a specific industry are: Silicon Valley and Los Angeles being hubs of technology and entertainment, respectively, in California, United States; and London, United Kingdom, being a hub of finance.
Urban geography is the subdiscipline of geography that derives from a study of cities and urban processes. Urban geographers and urbanists examine various aspects of urban life and the built environment. Scholars, activists, and the public have participated in, studied, and critiqued flows of economic and natural resources, human and non-human bodies, patterns of development and infrastructure, political and institutional activities, governance, decay and renewal, and notions of socio-spatial inclusions, exclusions, and everyday life. Urban geography includes different other fields in geography such as the physical, social, and economic aspects of urban geography. The physical geography of urban environments is essential to understand why a town is placed in a specific area, and how the conditions in the environment play an important role with regards to whether or not the city successfully develops. Social geography examines societal and cultural values, diversity, and other conditions that relate to people in the cities. Economic geography is important to examine the economic and job flow within the urban population. These various aspects involved in studying urban geography are necessary to better understand the layout and planning involved in the development of urban environments worldwide.
The standard of living in India varies from state to state. In 2021, extreme poverty was fully eradicated to as low as 0.8% and India is no longer the nation with the largest population under poverty.
Masahisa Fujita is a Japanese economist who has studied regional science and Urban economics and International Trade, Spatial Economy. He is a professor at Konan University and an adjunct professor at Institute of Economic Research, Kyoto University.
Over the past decade, there has been an increase in the use of information and communications technologies (ICTs) in China. As the largest developing country in the world, China faces a severe digital divide, which exists not only between mainland China and the developed countries, but also among its own regions and social groups.
The red corridor, also called the red zone, is the region in the eastern, central and the southern parts of India where the Naxalite–Maoist insurgency has the strongest presence. It has been steadily diminishing in terms of geographical coverage and number of violent incidents, and in 2021 it was confined to 25 "most affected" and 70 "total affected" districts across 10 states in two coal rich, remote, forested hilly clusters in and around Dandakaranya-Chhattisgarh-Odisha region and tri-junction area of Jharkhand-Bihar and-West Bengal.
Urbanization in China increased in speed following the initiation of the reform and opening policy. As of 2022, China had an urbanization rate of 64.7% and was expected to reach 75-80% by 2035.
In China today, poverty refers mainly to the rural poor. Decades of economic development has reduced urban extreme poverty. According to the World Bank, more than 850 million Chinese people have been lifted out of extreme poverty; China's poverty rate fell from 88 percent in 1981 to 0.7 percent in 2015, as measured by the percentage of people living on the equivalent of US$1.90 or less per day in 2011 purchasing price parity terms, which still stands in 2022. The Chinese definition of extreme poverty is more stringent than that of the World Bank: earning less than $2.30 a day at purchasing power parity (PPP), Since the start of far-reaching economic reforms in the late 1970s, growth has fuelled a substantial increase in per-capita income lifting people out of extreme poverty. China's per capita income has increased fivefold between 1990 and 2000, from $200 to $1,000. Between 2000 and 2010, per capita income also rose at the same rate, from $1,000 to $5,000, moving China into the ranks of middle-income countries. Between 1990 and 2005, China's progress accounted for more than three-quarters of global poverty reduction and was largely responsible for the world reaching the UN millennium development target of dividing extreme poverty in half. This can be attributed to a combination of a rapidly expanding labour market, driven by a protracted period of economic growth, and a series of government transfers such as an urban subsidy, and the introduction of a rural pension. The World Bank Group said that the percentage of the population living below the international poverty line of $1.9 fell to 0.7 percent in 2015, and poverty line of $3.2 fell to 7% in 2015. At the end of 2018, the number of people living below China's national poverty line of ¥2,300 (CNY) per year was 16.6 million, equal to 1.7% of the population at the time.
Shiba Prasad Chatterjee was a Professor of Geography at the University of Calcutta, India. He served as President of the International Geographical Union from 1964 until 1968, Chatterjee received a Murchison Award from the Royal Geographical Society in 1959, and a Padma Bhushan from the Government of India in 1985. He coined the name 'Meghalaya' for one of India's states.
Rural economics is the study of rural economies. Rural economies include both agricultural and non-agricultural industries, so rural economics has broader concerns than agricultural economics which focus more on food systems. Rural development and finance attempt to solve larger challenges within rural economics. These economic issues are often connected to the migration from rural areas due to lack of economic activities and rural poverty. Some interventions have been very successful in some parts of the world, with rural electrification and rural tourism providing anchors for transforming economies in some rural areas. These challenges often create rural-urban income disparities.
Rural poverty refers to poverty in rural areas, including factors of rural society, rural economy, and political systems that give rise to the poverty found there. Rural areas, because of their spread-out populations, typically have less well maintained infrastructure and a harder time accessing markets, which tend to be concentrated in population centers.
Housing inequality is a disparity in the quality of housing in a society which is a form of economic inequality. The right to housing is recognized by many national constitutions, and the lack of adequate housing can have adverse consequences for an individual or a family. The term may apply regionally, temporally or culturally. Housing inequality is directly related to racial, social, income and wealth inequality. It is often the result of market forces, discrimination and segregation.
China's current mainly market economy features a high degree of income inequality. According to the Asian Development Bank Institute, “before China implemented reform and opening-up policies in 1978, its income distribution pattern was characterized as egalitarian in all aspects.”
A secondary city is an urban hub that fills specific regional and local needs related to governance, economics, finance, education, trade, transportation. A secondary city is defined by population, area, function, and economic status, but also by their relationship to neighboring and distant cities and their socio-economic status. A secondary city may emerge from a cluster of smaller cities in a metropolitan region or may be the capital city of a province, state, or second-tier administrative unit within a country. Secondary cities are the fastest growing urban areas in lower and middle income countries, experiencing unplanned growth and development. By 2030, there will be twice as many medium size cities as there were in 1990, outnumbering the total number of megacities. According to the World Bank, secondary cities make up almost 40% of the world cities population. Many secondary cities in the Global South are expected to undergo massive expansions in the next few decades comparable to city growth in Europe and North America over the past two centuries. These cities are unique environments that generally have limited data and information on infrastructure, land tenure, and planning.
Education inequality in China exists on multiple levels, with significant disparities occurring along gender, geographical, and ethnic divides. More specifically, disparities exist in the distribution of educational resources nationwide, as well as the availability of education on levels, ranging from basic to higher education.
John Vernon Henderson is a Canadian-American economist and an academic. He is a Research Affiliate at the International Growth Centre, Director of the Urbanisation in Developing Countries Program, and a School Professor of Economic Geography at the London School of Economics.