Why are some cities with large GDP not "strong cities"?

Hou Yutong cartography

Text/Liu Yuying

Large cities are not necessarily strong, and small cities are not necessarily weak if they find their comparative advantages.

Today, when most cities are ranked by GDP, the recently published book "Strong City Era" uses a series of data and indices to evaluate the pattern and vitality of high-quality development of Chinese cities. The evaluation conveys a new concept: the high-quality development of cities is not only reflected in the effective use of resources of individual cities, but also reflected in the pattern of mutual division of labor and complementary advantages formed between different cities.

Recently, Lu Ming, one of the authors of "Strong City Era", distinguished professor of Antai College of Economics and Management of Shanghai Jiao Tong University and executive director of China Development Research Institute, was interviewed by China News Service Guois Express to talk about China's urbanization process, the changes that are taking place in China's urban landscape, and how to deal with this change.

Has China's urbanization slowed down?

China is a Through Train: Do you agree with the view that China's urbanization is now in a new period of comprehensive slowdown, or even that the urbanization process has ended?

Lu Ming: I don't agree with this view. First of all, in terms of data, the speed of urbanization in China has not slowed down, which can be seen from the comparison of the sixth population census to the seventh population census. During this decade, the rate of urbanization has accelerated slightly, statistically speaking.

Secondly, it should also be noted that the current urbanization process in China, especially in the household registration system, land supply in the areas where the population flows, there are still institutional constraints, and there is still a shortage of infrastructure and public services. If the right policies and measures can free up these spaces, make up for shortcomings through supply-side reforms, and release the potential of urbanization, then China's urbanization will not slow down. This is different from the history of other developed countries.

The state is a direct train: You have repeatedly called for equalization of public services and social security for urban migrants.

Lu Ming: The greatest significance of providing equalized public services and social security for the migrant population is that this is a win-win policy for economic and social development. From an individual point of view, such reforms can lead to better quality of life, employment opportunities, income levels, public services and social security in the process of mobility.

For the whole country, this is conducive to the free flow of population, conducive to improving the efficiency of human resources allocation, in the context of the trend aging and low birthrate, not only improves the allocation efficiency of human resources, but also is an extremely important source of power to promote economic development.

In addition to the above economic effects, at the social level, if the process of urbanization of the migrant population and the process of equalization of public services can be smoothly implemented, it will also help to eliminate the inequality caused by the differences in status between different residents in cities under the traditional system, especially the household registration system.

Why aren't some cities with high GDP "strong cities"?

The country is a through train: The book "Strong City Era" launched the "Big City Strong City Index". But surprisingly, the GDP of some cities is different from their ranking in the Big City Strong City Index. For example, Chongqing's GDP ranks 5th, and the big city strong city index only ranks 41st. Wuxi, which ranks 14th in terms of GDP, ranks 6th in the Great City Strong City Index. Changzhou, which ranks 25th in terms of GDP, ranks 10th in the Big City Strong City Index. Why is this ranking? What is a "strong city"?

Lu Ming: First of all, we should not be too entangled in the specific rankings in the book, because some rankings are calculated based on some existing statistics. Readers should pay more attention to some of the ideas we convey in the Strong City Index.

When Chen Xian, a teacher at Shanghai Jiao Tong University, compiled the strong city index, his core idea was: to see whether a city is strong or not, you can't just look at the total amount. China has passed the era of total expansion to drive urban development. Some places are desperately expanding their urban construction area and increasing investment, but the efficiency of investment is not high, the volume is large, but the efficiency is not high, which does not mean that the city is very strong.

Conversely, some cities do not have as large population size and economy, but they perform well in terms of resource efficiency, innovation, and labor productivity. So although such a city is not large, but the efficiency index is a plus for it.

The country is a through train: what specific ideas do these indicators convey?

Lu Ming: This index is to remind everyone that we must reverse the traditional concept, stop blindly increasing investment and expanding land, and blindly do the area of large cities, but pay attention to the efficiency and quality of urban development. In addition to some megacities and megacities constrained by traditional systems that may have room to continue to expand, more cities should pay more attention to some efficiency indicators in the future, such as output per unit of land area, which is conducive to improving intensive land use.

Another example is labor productivity and innovation, which are indicators that are conducive to improving the efficiency of human resource utilization. In conclusion, these efficiency indicators deserve full attention.

The State is Through Train: How to view the development and balance between cities?

Lu Ming: The relationship between development and balance is a concept that I have been calling for for change for more than a decade. The modern economy is becoming more and more concentrated in space, and the gap between economic scale and population size in different cities is gradually widening, which is the objective result of the agglomeration effect of the modern economy, and this is the case all over the world.

And balance, if we understand it as the total size between regions, to narrow the scale difference between regions, then there is a contradiction with the natural agglomeration economy trend of modern economy. Therefore, the most critical conceptual shift is to understand the balance between regions and development as a narrowing of the gap in per capita indicators. Per capita indicators usually refer to three, namely per capita GDP, real per capita income, and quality of life.

In general, these indicator gaps are in a downward trend in China. In terms of trends, in about 20 to 30 years, the gap in per capita GDP between regions in China can be narrowed to the status of some relatively large market economy countries.

Why are northern cities lagging behind?

The country is through train: the top 10 cities in the "urban capital vitality", except for Beijing, are all southern cities. How do you think the capital vitality of northern cities should be enhanced?

Lu Ming: I think we need to discuss the problem from the perspectives of innate conditions and acquired conditions.

From the perspective of acquired factors, it is generally agreed that the south, especially the Yangtze River Delta region and the Pearl River Delta region, has done relatively well in terms of the development of the market economy, business environment, friendliness to private enterprises, property rights protection, and market order. The government-business relationship between the government and enterprises is also more conducive to private enterprise investment. On the whole, the completeness of the industrial chain, the level of technological development, and the accumulation of human resources in these regions are also relatively good.

However, there are a number of issues that have been addressed less frequently in existing discussions, mainly geography. During the planned economy period, northern Chinese cities had advantages, and this advantage was maintained until the 20s of the 90th century. In the 20s of the 80th century, the per capita GDP of northern cities was still about 1.5 times that of southern cities, and it was not until the 20s of the 90th century that it shrank to 1.

However, after the reform and opening up, China's economy has embarked on a path of globalization and marketization. International trade is achieved by means of sea freight. There is a very important lack of natural conditions in the north, that is, the lack of cooperation between inland navigation and coastal ports. From the perspective of coastal ports, some northeastern ports will freeze in winter, and shipping conditions are relatively poor. More importantly, even if there are ports, the north lacks the cooperation of inland navigation like the south.

With the deepening of China's economic globalization, the northern part of the country as a whole develops manufacturing industry, especially the export-oriented manufacturing conditions are relatively inferior to the south. This can also explain well why the provinces of Northeast China and North China were once more brilliant, but after the reform and opening up, they were overtaken by the south. The system, concept, culture and other factors mentioned above are difficult to explain the changes in the gap between the North and the South.

Therefore, there are two aspects to what northern cities should do, on the one hand, they must objectively and fairly view the disadvantages of the relative natural geographical conditions of the north, and pay more attention to per capita indicators. Some cities in the north are relatively backward in terms of economic aggregate, but the per capita indicators are not so bad.

On the other hand, in the case that the natural geographical conditions are relatively not so good, the north should strive to optimize the acquired development conditions. However, with a slight regret, I also agree with the observation of all sectors of society that northern cities have indeed not done enough in terms of system, culture, business environment, and private property rights protection, so there should be some huge progress in these aspects to make the northern economy revitalized.

The country is a through train: how will a former resource-based city like Hegang or a former industrial city like Zibo develop in the future?

Lu Ming: There are some resource-based cities with relatively remote geography, and the population is now experiencing negative growth, but if we look at the problem from a per capita perspective, if the resources of a place are exhausted, then the decrease in population is conducive to the increase in the number of resources per capita. If there are many people there after the resources of resource-based cities are exhausted, it will bring about a lack of employment opportunities and per capita income cannot be increased.

How some industrial cities develop, the key is to see their own conditions. Some industrial cities depend on resource conditions, so they continue to rely on resource conditions. Some industrial cities are geographically close to the coast, so these places have the advantage of joining the whole industrial chain of industrial agglomeration in urban agglomerations. Some industrial cities are undertaking the strategic industrial functions of some countries, so they are subordinate to the strategic arrangement of the entire country.

Each industrial city should find its own industrial development model according to its own conditions, geographical location, resources, etc.