POLICY AND PLANNING FOR POPULATION AND
DEVELOPMENT IN MEDIUM-SIZED CITIES

Won Bae Kim

The trend of increasing concentration of people and economic activities in large cities and the concomitant growth of metropolitan areas has been viewed by some as an economically favourable development, providing economies of scale and agglomeration that have been conductive to industrialization. These metropolitan areas indeed have absorbed large numbers of people in non-agricultural jobs and have housed leading educational, cultural and scientific institutions, and business organizations. The largest metropolises in Asia now play crucial roles in national and international development. They are communication and transport hubs for their nations. Most have become either national or international financial and banking centres serving as nodal point in networks of international trade, business and other pursuits¹ (See Figure 1).

Often the largest metropolitan areas in Asia are the primate cities in which the concentration of modern productive and service facilities has become so great as to create marked disparities in levels of development between them and other regions within their countries. About 36 percent of the Republic of Korean population, for example, lives in Seoul and the surrounding metropolitan area, which also contains most business headquarters, the leading institutions of higher education and a disproportionate number of modern social and cultural amenities. This is also characteristic of Thailand, the Philippines and Indonesia. Moreover, the rapidity of the growth of large metropolitan centres in still relatively poor Asian nations has created serious social problems with which many Asian governments find it difficult to cope with. For example, job growth is often behind labour growth. Rapidly growing urban populations place increasing demands on public facilities and services, which are already overstrained. Serious environmental problems such as air and water pollution and traffic congestion are threatening the daily life of metropolitan populations. Furthermore, the continued concentration of people in the largest metropolises often drains human, financial and natural resources from already poor peripheral regions.

Refer to Figure 1. (Million Plus Cities in Asia)

Compared to industrialized countries, the speed of metropolitan growth in developing countries, particularly in Asia, is much faster, which some researchers identify as a development problem or a crisis. Too often, rapid metropolitan growth appears to be associated with low levels of economic development, demographic and functional primacy and regional disparities (Bronger, 1985; Rondinelli, 1985). The key question is whether metropolitan growth and regional disparities are a passing phase of development. Stylized facts, often represented by a bell-shape curve (Alonso, 1980), suggest that population concentration and regional inequality will eventually decrease as the economy develops and the spatial system matures (El-Shakhs,1982). Even if we accept this optimistic future, there remains a problem of how long a country can wait for that turning point to come.

A competing model suggests that in a group of countries which have dynamic rural sectors (China, India, Indonesia, Sri Lanka, Pakistan and Bangladesh belong to this group), agricultural prosperity coupled with rapidly falling birth rates could result in reverse migration, i.e., from cities to villages. However theoretically plausible this model is, it seems unlikely in reality because, in many parts of Asia, further expansion of the cultivable area is not possible. Further increases in rural population, though they can, without doubt, be accommodated by increased multiple cropping, irrigation, and the use of high-yielding varieties, will hardly be conducive to the required substantial increases in rural per capita incomes. To hold anticipated increases in the rural populations of Asia down as much as possible, an inexorable increase in the levels of urbanization is needed. As suggested, the reduction of rural fertility rates is probably the most important element of a responsible policy for human settlements in these countries.

II. COUNTERING METROPOLITAN GROWTH

Policies at the Inter-Regional Level

Attempts to plan for population redistribution in Asia have addressed several interrelated objectives: slowing metropolitan growth, increasing rural employment and income, and providing economic opportunity to backward areas. Although rigorous evaluations of the effectiveness of these attempts are not yet available, some impressions can be obtained from general reviews (Fuchs, 1981; Oberai, 1981; Laquian, Aquino and Postrado, 1981; Simmons, 1979). The major conclusion of these reviews is that population redistribution policies in the Asian countries have had limited impact.

Closed city programmes, with the obvious exception of China, have been ineffective. Rustication programmes have been adopted by only a very few countries. Judged only demographically, they seem to be successful. However, the social and economic impacts, including the effects on rural destinations, remain unknown. Nearly all countries in Asia have identified potential growth centres and mechanisms to encourage their development. The earlier optimism regarding such dispersal strategies has given way to widespread pessimism (Lo and Salih, 1978; Hansen, 1981). The programmes have generally failed to achieve both the expected growth in regional centres and the spread effects to the hinterlands. Disappointment with the outcome of industrially-based growth centre approaches has led many Asian governments to adopt rural development programmes including resettlement programmes. Despite the absence of definitive evaluations, the record seems to indicate mixed results. Even when successful, resettlement schemes appear to be costly.

Controlling Metropolitan Growth at the Intra-Regional Scale

To mitigate problems and to forestall further deterioration of the urban environment of large cities, several cities in Asia have experimented with numerous planning, policy, and administrative strategies. These means to control metropolitan growth at the intra-regional level can be grouped in three categories (Yeung, 1986). The first is strategies to contain metropolitan growth through physical controls. One method is to design and build satellite towns so that they can absorb the population and economic activities associated with metropolitan growth. Examples are Seoul, Shanghai, Tokyo, and to a lesser extent Territory of Hong Kong and Singapore. Satellite towns ideally are self-contained and balanced communities that are distant enough to discourage commuting. Satellite cities around Seoul and Tokyo are failures in this regard, because commuting is frequent and the economies of satellite cities are largely dependent upon the economy of a central city.

The greenbelt is another widely applied planning strategy to contain metropolitan growth, which has been adopted in Tokyo and Seoul. Although somewhat different in purpose, though not in function, Bangkok and Shanghai designated agricultural land or vegetable production belt where development was restricted. The creation of a new capital city is another strategy to relieve functional pressure on existing metropolises. A new capital was proposed in 1979 for the dispersal of Seoul's population. However the plan has been dormant since 1979. The Government of Malaysia has also considered this strategy.

It is increasingly recognized among planners that problems of metropolitan growth cannot be solved in a restricted geographical setting. A large region surrounding a metropolis must be incorporated into its planning and development. Tokyo was probably the first Asian city to adopt a regional approach. Shanghai and Seoul followed the same path. Other examples in Asia are now numerous, including Metropolitan Manila, Greater Bangkok, Jaboteck, and so forth.

Other measures used to combat metropolitan growth are reallocation of industrial, social and educational facilities. Republic of Korea provides a good example. Despite their relative success in slowing down metropolitan growth, these policies and programmes at the intra-regional level raise suspicion that focusing on the capital city region might neglect the inter-regional dimension of urbanization. In fact, Seoul's slow growth in recent years is more than compensated for by the the rapid growth of its surrounding satellite cities. The Capital Region has been attracting more migrants and thus retarding inter-regional population decentralization.

III. ALTERNATIVE TO METROPOLITAN GROWTH

The limitations of the existing population distribution policies suggest that the appropriate strategy in Asian countries should involve a combination of rural and urban strategies and that one must plan for larger cities as well as alternative urban centres where labour can be absorbed. With a mix of policies, one might envisage an integrated urban hierarchy that emphasizes complementarities among small towns, medium-sized and large cities.

Strong justifications for small and medium-sized cities can be found in both efficiency and equity arguments. The efficiency argument is that filling-up the gap between primate cities and lower-order centres will lead to an integrated national urban hierarchy and therefore a more efficient national economy. The promotion of small and medium-sized cities will distribute public services and facilities more evenly across the country and more broadly spread development benefits to a larger population. However, the narrow efficiency interpretation, that the costs of public service provision are less in small cities, is not warranted (Linn, 1983; Richardson, 1977).

Definition of Medium-Sized Cities

Medium-sized cities include various types and sizes of cities. Some authors use the terms intermediate cities or secondary cities instead of medium-sized cities. The definition of medium-sized cities is certainly a subject of debate. A consensus exists, however, among the researchers that population size alone does not adequately define medium-sized cities.

Even on the basis of population size, medium-sized cities should be defined in the particular size-distribution of the cities within a nation. For example, the definition of medium-sized cities with a population of 100,000 and more may exclude, in some Asian countries, smaller cities that in fact act as intermediate centres. Rondinelli (1983) proposes cities with population of 100,000 and more excluding the primate city, while others suggest a size including cities between 100,000 and one million (Hauser and Gardner, 1980).

Roles Of Medium-sized Cities

Evidence of the role played by medium-sized cities in national development is scanty. However, some authors (Rondinelli, 1985; Mathur,1982; Fawcett et al., 1980) suggest that the potential benefits of secondary cities include: countering metropolitan growth; promotion of regional development; absorbing population and thus relieving pressures on primate cities; stimulation of rural economies by providing linkages between rural and urban areas; and promoting national spatial integration via a more dispersed population.

The functions of medium-sized cities in the development process have certain common elements among groups of countries in Asia. In the more industrialized nations such as Republic of Korea and Japan, medium-sized cities tend to be viewed as instruments for bringing about a more balanced distribution of population and the amelioration of income inequalities within and between subnational regions. In the less industrialized nations such as Indonesia and the Philippines, medium-sized cities tend to be perceived as bridgeheads for promoting the growth of rural industries based on the processing of farm products for export. This rural-based development strategy is designed to provide non-agricultural employment and thus prevent a mass migration to primate and regional cities already undersupplied with essential services.

The current roles of medium-sized cities and their significance in relation to the national centre vary with the size of the nation and its level of development. The Philippines, Thailand, Republic of Korea and Indonesia have in common the problem of primacy and the need to develop stronger regional centres. China and India, because of their size, have well established large regional centres, but serious problems of national and regional integration. Malaysia and other Asian countries, with less evident problems of primacy, are nevertheless concerned with fostering urban growth outside their capital regions. Japan has apparently entered a stage of mature urbanization characterized by metropolitan deconcentration and strong growth of prefectural capitals.

Typology of Medium-Sized cities;

Considering the potential roles and functions of medium-sized cities in national development, the following typology classifies cities by two factors: regional location and the location in the national urban hierarchy.² As a matter of fact, the national urban strategies of Republic of Korea, The Philippines and Indonesia explicitly employ the concept of a national urban hierarchy and regional location (Government of Republic of Korea. 1982; Government of Indonesia; Pernia et al, 1984).³ According to this classification system. national centres and satellite centres are not qualified as medium-sized cities even though many satellite cities can be included in terms of population size alone. Another merit of this typology is that it can differentiate the role of medium-sized cities in the inter-regional development, i.e., the development of regional centres in a lagging region would contribute to the reduction of regional disparities and to the integration of the national economy.

Regional location	Location in the hierarchy
	National centre	Satellite	Regional centre	Major centre	Local centre
Advanced
Intermediate
Lagging

Characteristics of Medium-Sized Cities

According to the case studies of medium-sized cities, these urban centres can perform some or all of the following functions (Rondinelli, 1983; Pernia, 1983; Hardoy and Satterthwaite, 1986).

(1) Public and social service centres
(2) Regional marketing and trade centres
(3) Agroprocessing and supply centres
(4) Manufacturing centres
(5) Regional transport and communication centres

Higher-order centres like regional centres usually perform most of those functions, whereas lower-orders only perform one or two functions.

The social, economic and demographic characteristics of medium-sized cities in Asia are not well known. The characteristics summarized by Rondineli (1983) and others (Hardoy and Satterthwaite, 1986; Lo and Salih, 1978) represent more closely the lower end of the urban hierarchy (minor urban centres) than the upper-end (regional centres and major urban centre). The Republic of Korean data reveal that, compared to largest cities, medium-sized cities conform to the national urban average demographic profile (Table 1). The satellite cities of Seoul, however, show a higher proportion of population of 20 years old and over. Minor urban centres with strong agricultural bases show a very low proportion of population with high school education. Large cities tend to have larger proportions of educated adults (Note, Row A). Other things being equal, fast-growing cities tend to draw in more educated population. If this disproportionate concentration of highly educated population in large cities is caused by government policies such as the spatial distribution of certain educational and social services, there will be far reaching consequences from it.⁴

Table 1 also lists the industrial structure of cities in the Republic of Korea. Small cities, although they perform some trade, transport and service functions tend to be weak in manufacturing activities and strong in agricultural functions. Larger cities tend to have more manufacturing production function with few exceptions. The occupational structure of cities in the Republic of Korea indicates that major urban centres tend to specialize in manufacturing production, while most other intermediate centres are balanced in terms of occupational composition. Local centres, however, show that large proportions of workers are in agriculture related production jobs. Seoul is outstanding in its dominance in white collar jobs especially in professional and managerial jobs.

Social and economic infrastructure such as higher education, banking institutions and news media are better provided in medium-sized cities in quantity than in smaller cities and towns (Table 2). The quality of those facilities and services in medium-sized cities, of course, cannot compete with those of large cities, These socio-economic infrastructures, especially universities and banks, play a major role in local economic development in the long-run (Thompson, 1965) and almost determine the level of cities in the urban hierarchy.⁵

Refer to Table 1.

In terms of economic structure, the observation that, as city size increases, the share of manufacturing in local employment increases slowly, reaches a maximum and then declines, seems to be weakly supported in the case of Republic of Korea (Richardson 1977; Lo and Salih, 1978; Henderson, 1986). The simple multiple coefficient of determination of 0.09 indicates that the relationship between city size and proportion of manufacturing in employment is weak.⁶

IV. POLICIES AND PLANNING FOR MEDIUM-SIZED CITIES

It is important to distinguish medium-sized city strategies from growth centre strategies (Richardson, 1980). The former are not primarily concerned with the attraction of large-scale industry to generate regional development. Medium-sized city strategies focus much more on indigenous development, which implies more attention to measures that stimulate small-scale industry and the informal sector. With respect to infrastructure, a medium-sized city strategy gives equal attention to social infrastructure and industrial infrastructure. The crucial question in national urban strategy for medium-sized cities is how many cities should be selected for promotion. There are also problems associated with implementation.

The Republic of Korean Example: Past Policies

During the 1960's Seoul and, to a lesser extent, Busan were magnets of internal migration. Seoul alone absorbed nearly 52 percent of the total urban population increment and about 40 percent of total migration. The proportion of all migrants heading toward Seoul dropped however, to 30 percent between 1970 and 1975 and to 25 percent between 1975 and 1980. This means that other cities arose as alternative destinations for migration in the 1970's (Table 3). The rapid growth of population in a number of medium-sized cities helped to reduce the urban primacy and stabilized distribution.

Fast growing cities during the 1970's, doubling their population less than a decade, can be grouped into two types: satellite cities of Seoul enjoying the spill-over effects of the capitol and newly industrializing cities which received special attention from the central government. This phenomenon is not unfamiliar to other East Asian countries like Japan in the 1960s (Glickman, 1976; Liu, 1980).

Refer to Table 2

Refer to Table 3

The economics of these two types of cities differ in some respects. Those fast growing industrial centres in the southeast region did not experience severe growth problems, whereas satellite cities did. For example the satellite cities of Seoul showed higher unemployment rates indicating that labour supply exceeded labour demand (Kim, 1987). Both types of cities have in common the characteristics of large manufacturing employment in their economies. The regression result confirms the importance of the manufacturing base as an engine of population growth (Note, Row B).

The rapid growth of the industrial centres in the southeast region was primarily due to the government's industrial policy, which placed a strong emphasis on heavy and chemical industries and the concomitant efforts to build industrial complexes in those cities. In contrast, the stagnating or slow-growing cities are those which were largely left out of the central government's social overhead capital investment. The industrial location policy of the Government of the Republic of Korea has been instrumental in decentralizing industrial employment away from Seoul. The strategic importance of the manufacturing sector stems from its remarkable expansion during the 1960's and 1970's. In particular, the rapid expansion of heavy industries during the 1970's enabled industrial decentralization towards the southeast coastal area, which had comparative advantages in terms of inter-urban transport linkages, port facilities and agglomeration economies. It is evident from the Republic of Korean experience that there would have been no substantial industrial decentralization without rapid manufacturing expansion.

Recent Plans

The Second Comprehensive National Physical Development Plan (1982-91) promotes secondary cities. The basic idea is to provide intervening opportunities at sizable secondary cities. The choice of cities was based upon four categories of criteria: economic development potential, centrality and hinterland relations, contribution to inter-regional equity, and political acceptability.

Among the 15 designated cities (see Figure 2) population size varies from 50,000 to more than one million. The largest three cities; Daegu, Gwangju, and Daejeon, were selected to serve as the primary centres, while the remainder were to be secondary centres of growth. The former are expected to catch up the present level of Seoul's service functions, whereas the latter will be to play a substantive role as employment and service centres.

Planning measures include: (i) incentives for inducing labour-intensive manufacturing establishments, e.g., expansion of local industrial estates and tax exemption provision; (ii) priorities on site provision for relocated universities and research organizations from Seoul; (iii) improving transportation networks among these centres, and between each centre and its hinterland; (iv) considerable delegation of administrative power to localities; (v) enactment of a Growth Centre Promotion Law to finance its implementation.

The strategy clearly recognizes the regional dimension of medium-sized city development. For example, among the 15 designated centres, two-thirds are located either in lagging or intermediate regions. Regional centres such as Daegu, Gwangju and Daejeon, the size of which ranges from 0.65 to 1.6 million as of 1980, are given first priority. Policy instruments seems to be balanced in terms of physical and social emphasis.

Refer to Figure 2

Indonesia

In the first of Indonesia's five year development plan, medium-sized cities were not specifically identified as elements to be given special attention. However, the second five year plan has an explicit!}' stated urban policy goal of gradually redirecting the flow of migrants away from Jakarta and the spreading of employment opportunities to other cities (Hugo, 1980). The recent National Urban Development Strategy of Indonesia identifies five types of urban hierarchy: mature national development centres, emerging national development centres, inter-regional development centres, regional development centres and local service centres (Government of Indonesia, 1985). Two criteria were used to identify these centres: hinterland service and potential for manufacturing development. The government's emphasis is given to emerging national development centres (NDCs) particularly those outside of Java (Figure 3). Among these 15 NDCs, two-thirds are outside of Java, which means that the strategy considers regional location as an important criteria. These are medium urban centres that have the highest potential among urban areas for diversifying and otherwise strengthening the economies of their regions. The size of these NDCs ranges between populations of 217,000 and 1,265,000.

These emerging centres play a vital role in the strategy. The policy emphasis for these centres is on investments that will strengthen and stabilize their economies and support additional growth. These centres will be strengthened through employment creation and economic diversification, the development of inter-regional linkages, and improving internal structure. Especially for manufacturing diversification in those centres, necessary infrastructure will be provided and other assistance such as in land acquisition, will also provided. Through job training and higher education, a skilled labour force, which these centres often lack, will be developed. Analyses of local comparative advantages should be helpful in designing effective policies in this regard. Decentralizing business services to NDCs, which are at present overwhelmingly concentrated in Jakarta, will be essential to sustaining the economies of NDCs. Of course, continued improvement of transport networks between these NDCs and other smaller cities is necessary for national and regional integration. In order to reduce further congestion and development costs in these centres, and to take advantage of cost-recovery, the expansion of urban areas should be planned ahead. The availability of resources to finance those investments, however, remains a problem, considering the slow growth of Indonesian economy in recent period.

Refer to Figure 3

V. PLANNING AT THE REGIONAL AND LOCAL LEVEL

Many medium-sized cities in Asia are caught in the middle of development problems. They are growing in population and in physical size, and their economies are more diversified and complex. Yet they often lack the resources to cope with these changes and the capacity to influence the direction of change. Planning for medium-sized cities at the regional and local level must focus on creating self-sustaining economies capable of meeting changing needs in these cities over the long run.

Rondinelli (1983) summarizes four essential areas of planning for medium-sized cities:
(1) Increasing the quality and coverage of basic social services, facilities and infrastructure;
(2) Improving physical infrastructure so that medium-sized cities can attract and support more diversified economic activities;
(3) Strengthening the economic base and employment structure to raise productivity and income and increase the capacity of medium-sized cities to continue to grow and diversity; and
(4) Building the administrative, planning and financial capacity of medium-sized city governments to manage their development more effectively. In order to fulfil these planning functions, we need to understand how an urban system is working in local, regional and national contexts. Focusing on the local context, the role of local government can be understood as facilitating the functioning of market mechanisms in the supply and demand of various sectors. The following diagram illustrates the basic elements of an urban system.

Refer to diagram

Because of space constraints, this paper focuses on the area of economic planning at the local level and briefly discusses local management capacity.

The national strategy for secondary cities development in the Republic of Korea also spells out local economic development schemes for different types of cities, mainly classified by industrial composition, because it refers both to the job that an individual does and to his position in society. Occupation therefore reveals social mobility within an urban economy. This means that planning at the regional and local level for medium-sized cities should move away from an exclusively industry-based strategy to a combined industry and occupation-based strategy (Thompson, 1986). The principal idea is "human-centred development" rather than industry or infrastructure-centred development. The importance of human resources is emphasized in recent national urbanization policy research (Renaud,1981). Thompson (1986) suggests five occupational-functional groupings: (1) entrepreneur ship, capturing the propensity to start new businesses; (2) central administration, performing the headquarters function; (3) research and development, serving as a centre of science and technology; (4) precision operations, focusing on industries that employ more craftsmen and technicians; (5) routine operations, ranging across manufacturing, trade and services. Industry classification can be done for the purpose at hand: e.g., export vs. local, locationally linked vs. footloose, durable goods vs. nondurable and services, or often conventional classifications.

The principle is to identify local comparative advantages. First, see the columns. In a given industry, how can we climb up the occupational ladder to achieve higher rewards. Second, see the rows to determine in which industry we have comparative advantages.

The application of the industrial-occupational framework to the Republic of Korean data reveals interesting facts (Table 4). Seoul, as the primate city of the nation, shows a concentration of jobs in the upper rows of the occupational category in most economic activities, i.e., professional and technical, administrators and managers, and supporting clerical jobs, compared to the averages of all cities. Busan, the second large city , and Incheon, the largest satellite city of Seoul, reveal a heavy concentration of jobs in the bottom rows of the occupational ladder- service and production in most categories of industry, although exceptions in a few industrial sectors, e.g., fisheries, trade and transportation in which these two cities have comparative advantages. Other large cities such as Daegu, Gwangji and Daejeon do not indicate any definitive pattern but generally show a favourable occupational mix in the trade and services sectors. One strategy would be to identify industries in which a city has comparative advantages and to strengthen entrepreneurship, research and development and central administration functions in these industries. Alternatively a city already endowed with relatively strong professional service, managerial capacity and research and development functions might invest in social and economic infrastructures in order to attract new or fast growing industries, which can be identified from national output patterns.

Refer to Table 4 

Other planning related issues such as transportation, housing, land use and public services are essentially the problem of demand and supply. As illustrated in Figure 4, there are two types of strategies in urban management: one is to control the sources of demand for public goods and services and the other is to act upon the supply via either direct or indirect means. An obvious choice of limiting city growth as reviewed earlier is not likely to be very effective in Asian market economies. The speed of population growth and the great population size seem to be major factors behind much of the under-supply of the basic urban infrastructure, although the local management capacity also makes a large difference. The regression result indicates that the speed of growth and population size are indeed responsible for the under-supply of housing in Republic of Korean cities (Note,  Row C).

The most serious and frequently reported difficulty that city governments face in meeting the needs and challenges of urban growth is the severe shortages of local financial resources. The cities of Asia show a great variation in the responsibility and authority given to the city governments. At one extreme, the Territory of Hong Kong and Singapore are fully autonomous in the management of urban growth, while at the other extreme the local government in Bangkok has only very few functions, even less authority to raise revenues, and must share the control over urban growth with many national level agencies. In between these two extremes, lie the cases of Jakarta and Seoul, where the local authority has relatively far reaching responsibilities and capacity, while many of the intermediate cities in the Asian countries have much less control over urban services, revenue sources, and thus over the destiny of their jurisdictions (Linn, 1985). Large cities, however, have a better position in terms of local financing because of their higher per capita income and large population base. The Republic of Korean data support the proposition that cities with a strong manufacturing base and large population size have greater local fiscal capacity as shown in Note, Row D. However, expanding revenue sources and tax bases is not the only option available to local governments. Improving public sector productivity through better management is another means to increase the city governments' capacity to meet rising demands for public services and goods (Prantilla et al., 1986). Local governments in medium-sized cities are weak in technical capacity in urban management including fiscal management (Rondinelli, 1983). Central government's training programme or training through the co-operation with local universities would help raise management capability in local urban management.

Refer to Figure 4

Refer to Notes

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2. We can add another spatial dimension to this framework, i.e., regional population density. This three dimensional framework should perhaps be more useful in the countries where rural population density is high.

3. In the Philippines, regions are classified into three types: central industrial; traditional agricultural; and frontier (Pernia et. al., 1983)

4 . The strong positive correlation between a city's population and the educational attainment of adults in the city is observed in Brazil (Henderson, 1986).

5. The urban hierarchy in Table 2 was based upon the result of cluster analysis using the three function in the table.

6. A quadratic form was used to test the relationship between city size and manufacturing share of employment. The result indicates correct signs of size variables, but the overall explanatory power is weak (R-squared value of 0.09).