The Name Game: Urbanization in India

What is rural? What is urban? Different countries use different definitions and sometimes there are multiple definitions within a country. In India, as Reuben Abraham and Pritika Hingorani write, the same state can be 16% or 99% urban depending on the definition..

In India, only “statutory towns” are considered urban and have a municipal administration — a definition that officially leaves the country 26 percent urban. State governments make the decision using widely differing criteria; demographic considerations are peripheral at times. The Census of India provides the only other official, and uniform, estimate. Its formula uses a mix of population, density and occupation criteria, and pegs India at 31 percent urban.

Such estimates can be misleadingly low. For instance, Kerala is statutorily only 16 percent urban. Yet the census sees the well-developed southern state as approximately 48 percent urban. If we use a population cutoff of 5,000 residents as Ghana and Lebanon do, or even Mexico’s threshold of 2,500 people, Kerala’s urban share leaps to 99 percent, which is more consistent with ground reality.

So what? A rose by any other name smells as sweet but definitions matter for policy and resource flows:

The consequences of underestimating the urban share of the population are dire. Resources are badly misallocated: By one estimate, over 80 percent of federal government financing still goes to rural development. This reduces incentives for politicians, especially rural ones, to change the status quo. Tens of millions of Indians who live in dense, urban-like settlements are governed by rural governments that lack the mandate and the money to deliver basic services. In India, urban governments are constitutionally required to provide things such as fire departments, sewer lines, arterial roads and building codes. Local bodies in rural areas aren’t.

In addition, urban planning becomes particularly haphazard when cities grow but aren’t defined as such. How can roads, water lines, sewage lines and metros be arranged when a city is governed by multiple rural units?

As satellite data clearly show, most cities extend well beyond their administrative limits, and dense, linear settlements spread out of those cities along transit corridors. This growth is unregulated and unplanned, marred by narrow roads, growing distance from major thoroughfares, limited open space and haphazardly divided plots.

…what appears to be a single economic unit is now governed by a multitude of rural and urban jurisdictions, with no mechanism to coordinate on mobility, public goods or municipal services. It’s difficult and expensive to retrofit such cities with proper infrastructure and services.


As President Captain Bolsonaro pointed out, without order, there can be no progress because order is progress and progress is order.

animal farm right?
if the sociology dept has pretty much eliminated free will as a variable
in their studies
and the resulting studies mostly dont replicate
mebbe they need to add a little free will back into the
sociology pancake batter?

No. If India wants to be taken seriously, it needs to clean up its act.

crime in india is also up but
if brazil wants to be taken seriously they should
seriously rethink the Brazilian buttlift1
1the most dangerous of the aesthetic surgery procedures.

It is not a Brazilian procedure.

Then they need to stop taking credit for it.

"If India wants to be taken seriously, it needs to clean up its act."

India's #1 domestic product is sewage and its #1 export is Indians.

Yes, it needs to be fixed, starting a hundred years ago.

It looks like a regulatory story: Cities have to provide more services, so cities have to levy more local taxes, so politicians and voters choose to minimise the "urban" regulatory perimeter and retain greater freedom on tax & spend. Thus 75% of the country is "rural" and 80% of development spending is "rural", which makes perfect sense. The more relevant question would be to show that "rural" development split across many jurisdictions causes worse outcomes than "urban" development in one more heavily-taxed area.

If not taxed, these ungoverned spaces end up with high living costs that defy economic theory.

When taxes are restricted, the living costs rise in defiance of economic theory.

Economists will claim that high living costs are caused by the natural monopoly of land, as if the US, or most off the world suffers a scarcity of land.

Or that its government regulation that prohibit 200 single family homes with front and backyards per acre.

Or government regulations that prevent an eight inch water main from serving 10,000 people just to deny rezoning from 200 single family lots with backyard septic to 50 high rise luxury condos.

But its roads that end up being the sticking point.

Roads require taxes in the US given no one is willing to pay a toll to drive to their neighborhood where they have their home. Developers, once they sell most of their project will not pay to improve the roads beyond their boundary. Charging upfront is the same as banning development by regulation. Gaining support for taxes to build roads gets opposition based on more roads will only bring more people and thus only make congestion even worse.

But the taxes fall on the people who had no say in the development that drives the need for roads paid for by taxes. Basically, taxes without representation.

I have mixed feelings about what I will call "consolidation". I recall a time in America when many metropolitan areas were considering consolidation. Jacksonville did it in 1968: all of Duval County (a geographically large county) is in the City of Jacksonville, making Jacksonville the largest city in America (by area not population). I don't reside there so I don't know how well that has worked out. But I do reside in a large low country county with widely disparate levels of income, those with high incomes concentrated in one area. Those who reside in the area with high incomes would prefer more and better government services (e.g., infrastructure), but those who reside in the other areas in the county oppose more government spending in the area with high incomes. Because there are many more people in the areas with relatively low incomes, they can thwart any efforts to increase government services. The area with high incomes has attempted to incorporate, but doing so requires the vote and approval of the entire county, and the people in the areas with relatively low incomes have always defeated the attempts. Why would they oppose it? Because the area with high incomes has high property values and high property taxes that are collected by the county, much of the taxes spent elsewhere in the county. My point is that consolidation works well when the population throughout the area is similar, but not so well when it's not.

Tyler writes on the challenge of underdevelopment in urban areas:

In addition, urban planning becomes particularly haphazard when cities grow but aren’t defined as such. How can roads, water lines, sewage lines and metros be arranged when a city is governed by multiple rural units?

There's math that can be deployed to solve the technical challenges. The real problems however are political.

Someone with power always has a good reason when a city’s official borders have little to do with reality. St. Louis County has many dozens of municipalities and a bunch of separate school districts. Most of them were created to keep “urban” people away, with a variety of laws that make it harder to move in. They also affect how transportation is designed in the region: Highways and metro lines end when it,s convenient to someone to stop them. Highway 70’s route makes little sense if you look at traffic, but it makes a lot of sense if you look at how many municipalities get a piece of the highway to police.

So don’t just look at India: Most dysfunction in cities comes from impolite preferences that people do not want to admit.

Not sure about this post. I think if you draw a 100 km circle around the biggest cities and count the population, you can see what percent of the population is urban and rural.

Bonus trivia: the majority of Americans lived in cities starting in 1920, however it varied state to state: Kentucky did not reach the 50% threshold until 1980, and Mississippi and Maine are still more rural than urban (

China only recently, like 10 years ago, passed the 50% threshold.

The coordination of infrastructure problem could be addressed at the state level.

Judging by previous posts on this topic I would have expected this lack of urban planning to be classified as good, free market and all...


You haven’t been reading carefully. Read Alex’s paper on Gurgaon.

Unfortunately water, electricity, and other municipal utilities still require some form of urban planning to execute since you are running wires and piping everywhere and it will step on other people's toes. Or India can pull a China and just eminent domain everything to full effect. Indeed central planning at least in China gave it the lead over India's more bureacratic democracy.

Many people do not want to change the status to a town or a city simply because it would result in paying taxes.

The corollary is that people don't desire the services those taxes can pay for?

People may not want the specific services that a city must provide under law.

Digging sewer lines and septic systems is not that hard, the locals can figure it out. Here is a link, a how to:

PVC pipe is cheap.

Can we just say in the 21st century people are moving mainly into urban settings and a lot of conurbations?

Population density is a better measure of urbanization that absolute numbers. The threshold in India will likely be a lot higher than in a country like the US though.

The U.S. defines "urban areas" largely without regard to municipal boundaries along the lines of "a core area of 1000 persons per square mile, together with surrounding areas of 500 persons per square, aggregating to at least 2500 people." Seems like India could benefit from that kind of consistent definition.

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