Coordinating Urban and Rural Development in China

Coordinating Urban and Rural Development in China

Learning from Chengdu

Ye Yumin and Richard LeGates

This detailed study offers a succinct yet comprehensive introduction to China’s crucial policy to coordinate urban and rural development. It describes the theoretical, political, and economic reasons why China allowed a large gap between urban and rural incomes, public services, and quality of life to emerge, and the recent national and local government efforts to narrow this inequality.

Chapter 9: Restructuring land, labor, and capital markets

Ye Yumin and Richard LeGates

Subjects: asian studies, asian development, asian urban and regional studies, development studies, asian development, development studies, urban and regional studies, urban studies


The most important characteristic of developing countries is a distinct dual economic structure: the coexistence of advanced modern sectors and traditional backward sectors and of prosperous cities and traditional backward rural areas (Lewis, 1954). The main task of developing countries is to achieve structural transformation and upgrade their economies by expanding the proportion of modern sectors and cities and reducing the proportion of traditional sectors and rural areas, while simultaneously transforming traditional sectors and rural areas and promoting their modernization. To achieve an orderly development process and ultimately to modernize, traditional society must be restructured so that factors of production flow in fundamentally different ways. The labor force must shift from rural to urban occupations, capital must increasingly flow into modern urban enterprises, and more land must be devoted to urban as opposed to rural uses. Unlike other regions in China, Chengdu has established institutions and mechanisms to promote the proper movement of population, capital and land between urban and rural areas as part of its coordinated urban–rural development program.

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