Although the mechanisms of urban poverty generation in China have received a great deal of attention in the past few years, there has been very little focus on the spatial distribution of poverty. There is therefore a need to understand ‘spatiality’ of poverty. Here, we use the term ‘spatiality’ specifically to indicate the importance of space in poverty generation. Our scope is more than the spatial distribution or the urban poor per se. We try to understand how poverty is generated in specific individual neighbourhoods, for example, contingent upon the position of a neighbourhood in the spatial framework of development. In this chapter, we examine poor neighbourhoods and relate them to state development strategies and public policies. In short, we argue that poverty concentration is formed through spatial differentiation driven by a set of institutional factors. SPATIALITY OF THE NEW URBAN POVERTY Although urban poverty is a relatively new phenomenon, its spatiality should be traced back to the uneven development of urban space going back to the pre-1949 era. In the period of state socialism, systematic underinvestment in the old city enabled the state to accumulate capital needed to build new industrial areas. These industrial areas were located at the periphery of the city, forming an industrial belt, and now that commodity housing has led to rapid sprawl, the inner suburbs. Underinvestment in the built environment created a chronic housing shortage problem in the 1950s–1970s. There was very slow change in the urban landscape of the old areas and...
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