Ethiopian Civil Service University

Rural-Urban Development
MDM5061

Chapter Six- Problem of

Urbanization and urban governance
April 2022
 Chapter Six
CHAPTER 6: PROBLEM OF URBANIZATION AND URBAN
GOVERNANCE
6.1. The Urban Land Nexus and Housing
6.2. Urban Poverty
6.3. Urban Transportation
6.4. Role of Local Government
6.5. Local government Revenue
 Urban Land Nexus Housing
■ Urban land markets play a critical role in shaping urban development outcomes—determining
the location, density, form and price of residential, commercial and industrial development.
– Urban land markets are driven by both demand and supply factors.
■ On the demand side, population growth, income, and much land is demanded to support
development.
■ Urban land supply is determined by topography and physical conditions, patterns of land
ownership, availability of infrastructure—roads, water, electricity—and government
regulations.
– The interaction of urban land market demand and supply determines urban land prices. If
urban land supply is very responsive to demand, land prices will tend to reflect the productive
value of land.
– If urban land markets are constrained and cannot effectively respond to demand pressure,
land prices will tend to be much higher—exceeding their productive value.
■ These constraints are often the result of restrictive land use regulations, inadequate network
infrastructure to support urban land development, unclear property ownership and titling
records, and the actions of landowners to drive up land prices by withholding land from the
market.
 Urban Housing
■ Migrants to cities confront substantial shortages of affordable housing and land access for housing
– Left with few housing options in the formal sector, a large number of population resort to options
in informal settlements.
■ House is one of the most basic necessities of life for humans along with food, water and clothing.
– Its quantity and quality need to be as standard as possible to fulfil the requirements of a good
housing.
– Not only because most people spend the major part of their life in houses but also for the reason
that important human activities such as key household decisions, socialization of children,
consumption and others take place in houses.
– Bondages and values established and attached to houses make occupants create irrevocable love
for their houses, which may imply that the more decent the houses are the stronger bondage and
values people would develop towards houses.
■ The issues of housing have mistakenly been understood mainly in relation to urban areas in
Ethiopia and housing development and related policies and strategies are urban biased.
– On the other hand, urban housing conditions per se are not up to the required standard.
– Most of the country’s urban centers are currently suffering from a host of complicatedly linked
problems, including rising unemployment, deepening poverty, severe housing shortage and lack of
good governance
 Urban Housing
■ Available evidences illustrate that though the severe shortages of housing in urban
areas create congestion, the most important cause of overcrowding is cost.
– In weighing the alternatives of location, amenities and cost per room, the poor tend
to accept crowding to limit housing costs and provide for alternative needs.
– Accordingly overcrowding is associated with people with low-income or no income
as these people very often cannot pay higher rents
■ Urban growth path with no doubt yielded nothing but a large size of urban population
residing in unhygienic, congested and poor conditions while the conditions of rural
housing are more terrible than its urban counterpart.
– Poor housing conditions attributed by overcrowding, poor housekeeping, poor
designing and construction, etc. are the major factors for the presence of substandard
housing and poor health status of the occupants.
– These problems are increasing at an alarming rate compounded by homelessness,
formation of slums and squatter settlements especially in towns and big cities.
– Population growth, migration of people from rural to urban areas in search of job,
natural and man-made disasters, are creating extreme overcrowding and poor
housing in urban settings
 Urban Housing
■ Like any other basic necessities of survival, housing has two means of assessing its shortages:
quantitative and qualitative.
■ Quantitative assessment has to do with the inadequacy of housing itself seen in terms of people’s
need, i.e., supply side dimension.
– This has been caused by the fast growth of population in the face of slowly developing house
constructions which is in turn caused by various socio-economic, political and institutional
factors.
– Wide gaps have been created between the supply of and the need for housing across the world
mainly in poor developing countries like Bangladesh, Sir Lanka, Pakistan and Indonesia in the
Asia, and Nigeria and Ethiopia in Africa.
– The widening gap between supply and demand has created a market situation whereby houses
have become unstoppably very expensive as the case of Nigeria clearly demonstrates though
countries like Ethiopia are manifesting the same skyrocketing market prices for houses, which are
beyond the reach of most citizens to realize.
■ Qualitative assessment on the other hand is based on the materials from which houses are being
made and incomplete houses.
– Due to the rising prices of construction materials and the falling capacity of the people to afford,
less durable and poor quality construction materials have been used by most house builders
Urbanization Problems…
■ The manifestation of urban poverty includes:
– fast growing population of street children,
– homelessness,
– prostitution,
– beggary,
– high unemployment,
– overcrowding and congested living conditions
– urban services & infrastructure have deteriorated & don't attract investors.
■ Urban poverty far in excess of those in rural areas.
■ It is currently estimated that the number of urban dwellers living in life-
threatening poverty will have increased to 1.5 billion by the year 2025.
■ Within a few decades, the number of households living in poverty in urban
centers will thus far exceed those in rural areas.
 Urbanization Problems …
 Characteristics and Causes of Urban Poverty
■ Some authors doubt the distinction b/n urban & rural poverty b/c of the fear that such
distinction would remove one from considering the main determinants of poverty.
– There is, however, some distinguishing features of urban poverty that need to be recognized
& understood.
– The incidence, economics, demography & politics of poverty differ b/n urban & rural areas.
– Therefore the analysis, formulation & implementation of policies should be differentiated
although policy coordination is obviously needed.
– Wage labor or the labor market is the main determinant of urban poverty.
– Most of the urban poor earn income from the informal sector.
– While their earnings do not have as large a seasonal component as those of the rural poor,
their incomes are probably almost as unstable b/c they have little protection from sickness
& injury & the unpredictable demand for their services.
– The poor possess little human capital & almost no physical capital that can be sold or
consumed at the time of a sudden dip in their earnings.
– The poor, having no asset that can be used as collateral, also lack access to credit markets.
 Urbanization Problems …
■ Other dimensions of urban poverty include
– poor environmental conditions,
– changes in prices of basic goods,
– lack of social network,
– violence & insecure tenure status.
■ Some scholars add commodization of urban economy & the negative effects of gov’t
actions & policies to the list of urban poverty dimensions.
■ In addition absence of mechanisms to involve the poor in the decision making process
could also be cited as another dimension of urban poverty.
• The env’t & health risks faced by the urban poor result from:
 The combination of industrial & residential functions;
 Competition for land; high living densities, overcrowded housing,
 Traffic congestion, pollution and
 The mismatch b/n urban growth & the provision of clean water supply, sanitation, solid
waste disposal etc.
Urbanization Problems …
 The quality of the urban env’t poses health threats including typhoid, diarrhea,
cholera, intestinal worms.
 These diseases come from contamination of water & food; poor garbage collection,
overcrowded housing & insufficient water for hygiene.
■ The urban economy is more commercialized than the rural economies & such
commodization affects the lives of the urban poor by affecting their needs for
subsistence, housing, education etc.
– Increases in the prices of food, house rent & educational fees will put pressure
on the urban poor.
– Urban areas are marked by social diversity & impersonal relationship.
– Urban people have different ethnic, cultural & linguistics origins.
– Such diversity leads to fragmentation & crime.
– The poor are more often the victims of urban crime.
– The growing phenomena of urban street children, prostitution & begging are
associated with family breakdown, poverty & absence of social networks.
 Urbanization Problems …
■ The urban poor are also affected negatively by the state policy.
– For instance, the gov’t policy on security of land makes the poor to live in an
increasing terror of losing their only assets & personal possession.
– Insecure tenure status forces the urban poor to live in self built, illegal housing
which are not provided with gov’t services such as schools, health services etc.
■ There is a considerable debate concerning the causes of urban poverty.
– Some authors emphasize the structural adjustment programs of different
countries as the main cause of poverty. The result of SAP includes:
 increases in food price & service charges,
 restrictions on wage levels,
 reduction in employment &
 declines in urban infrastructure expenditure.
They argue the emergence of the new poor (as opposed to the chronic poor) as a
consequence of loss of jobs due to structural adjustments.
 Urban Transportation
■ Urban Transportation at the Crossroads
■ Cities are locations having a high level of accumulation and concentration of economic
activities.
– They are complex spatial structures supported by infrastructures, including transport systems.
– Urban productivity is highly dependent on the efficiency of its transport system to move labor,
consumers, and freight between multiple origins and destinations.
■ Transport terminals such as ports, airports, and railyards are located within urban areas,
help anchor a city within a regional and global mobility system.
– Still, they are also contributing to a specific array of challenges. Some challenges are ancient, like
congestion while others are new like urban freight distribution or environmental impacts.
■ Congestion is one of the most prevalent transport challenges in large urban
agglomerations.
– Congestion is particularly linked with motorization and the diffusion of the automobile, which has
increased the demand for transport infrastructures.
– However, the supply of infrastructures has often not been able to keep up with mobility growth.
– Since vehicles spend the majority of the time parked, motorization has expanded the demand for
parking space
 Urban Transportation
■ Congestion and parking are also interrelated since street parking consumes
transport capacity, removing one or two paths for circulation along urban roads.
– Further, looking for a parking space (called “cruising”) creates additional delays and
impairs local circulation.
– In central areas of large cities, cruising may account for more than 10% of the local
circulation, as drivers can spend up to 20 minutes looking for a parking spot.
– This practice is often judged more economically effective than using a paying off-street
parking facility. The time spent looking for a free (or low cost) parking space is
compensated by the monetary savings.
■ Parking also impairs deliveries as many delivery vehicles will double-park at the
closest possible spot to unload their cargo.
– Identifying the true cause of congestion is a strategic issue for urban planning since
congestion is commonly the outcome of specific circumstances such as the lack of parking
or poorly coordinated traffic signals.
Urban Transportation
 Urban Transportation
■ Urban Transport Challenge
– Rapid urbanization
– Increase in motorization
– Low quality public transport
– Lack of hierarchical highway, road and street systems
– Poor non-motorized transport (NMT) infrastructure
– Lack of Resources
■ Preparation of Urban Transport Strategies/Plans/Programs
– Integration of transport plans and land use plans
– support public transport and non-motorized transport-friendly land development
– Regulated Competition for the Bus Industry “Off the street” competition rather than “on the street”
competition
– Clear distinction between government and private sector responsibilities and functions
– Targeting/integrating subsidies
– Sustainable Urban Transport Financing e.g., urban transport funds
– Transport Demand Management, parking and/or congestion fees
 Urbanization Governance
Growing Demand for Infrastructure & Services
■ The major part of urbanization is taking place in the poorest countries of the world.
– For instance the urban population of Sub-Saharan Africa is growing at the rate of nearly 6% per year,
& will double in the next 12 yrs.
– At present growth rates, African towns & cities will have to provide homes, livelihoods & urban
services for more than 500 million new citizens over the next 25 years - more than the present urban
& rural population of the whole continent.
■ Urban growth places continual pressure on cities & towns for new services & infrastructure, as well as
upgrading of existing facilities.
– The maintenance of critical basic infrastructure, such as roads, power, water & sanitation, has
fallen dangerously behind.
– Large components of the infrastructure of some cities & towns have deteriorated to the extent that
they can no longer be affordably rehabilitated & must be replaced.
– The consequence of deteriorating infrastructure & services is that economic productivity & the
quality of life of urban residents begins to suffer.
– This economic decline in turn affects the ability of city & town managers to maintain & improve
infrastructure & services.
– The lack of a sound infrastructure & service base also makes it more difficult for cities & towns to
compete regionally & internationally.
 Urbanization Governance

Urban Management and Policy

■ Upon the direction of decentralization, devolution of power, authority &
resources to the regional states is said to take place.
– However, a clear decentralization policy & practice is lacking, particularly
to municipalities.
– Investment in municipalities in health, water, power & communication is
mostly done by regional or central gov’ts.
– Coordination & involvement of stakeholders in municipal affairs lacks a lot.
 Turnover of authorities is very high.
 Lack of capacity is evident in most municipalities.
 Lack of good governance
Weak Municipal Finance
 Urban areas need a constant flow of finances to keep them functioning.
 Getting the balance right b/n maintenance & new capital expenditure, &
b/n servicing existing & new areas, is an ongoing challenge.