By Alex Smith | March 11, 2020

China’s cities have massively increased in size in recent decades, improving the living standards of hundreds of millions of new urbanites. But counterintuitively, most of these cities are not dense enough. China has a problem with urban sprawl, and its system of “apartheid without the racism” hinders rural citizens from achieving the Chinese Dream.

In recent years, Chinese urban planning and design has often captured international media attention and drawn ridicule. Photo essays have depicted a wide range of urban trends, including tourist theme parks staffed by dwarfs, oversized buildings resembling human figures and inanimate objects, dozens of so-called “copycat towns” modeled on famous foreign cities, and, perhaps most notably, China’s vast “ghost towns,” which are expansive futuristic cities with hardly any residents. Unfortunately, scant attention has been paid to the most serious problem inflicted on China’s cities: urban sprawl.

Urban sprawl, most commonly defined as dispersed, excessive, and wasteful outward urban growth, occurs when urban spatial expansion outstrips the rate of population growth. While in the United States and other Western countries, urban sprawl is often characterized by the growth of suburbs filled with single-family homes, in  China, cities are often developed well beyond the urban core, leaving vacant sections in between and requiring the expansion of infrastructure.

According to a 2014 World Bank report, the average population density of Chinese cities actually dropped by over 25% between 2004 and 2014. And while China may boast the world’s largest urban population, its cities tend to be significantly less dense than their global counterparts. The World Bank notes that if the densest areas of the southern Chinese metropolis of Guangzhou were to be increased to the same density as Seoul, it would be able to accommodate an additional 4.2 million people, while nearby Shenzhen could house an additional 5.3 million individuals.   

Why is urban sprawl a problem?

China has rapidly urbanized since the 1980s — 18% of the population was considered urban in 1981 compared with around 60% today. This has undoubtedly led to major improvements in the living standards of hundreds of millions of ordinary Chinese. However, urban sprawl works to undermine the benefits of urbanization and has brought with it a range of negative environmental, economic, and social consequences.

Economically, urban sprawl diminishes the potential efficiency and productivity gains that accompany the concentration of people and economic activity. In addition, the outward expansion of cities necessitates the extension of costly physical infrastructure, such as roads. While such infrastructure projects may help local governments meet their economic growth targets, the World Bank suggests that a more sustainable approach would see these targets met by increasing productivity through fostering denser cities and investing in services and other value-added activities. 

The environmental impact of urban sprawl is also nothing to sneeze at. Sprawling cities lead to greater dependency on cars and longer commute times, which result in increased air and water pollution. Denser cities have also been found to use energy more efficiently. In China, the rapid conversion of rural to urban land also poses a risk to food security by eating into the supply of arable farmland.  

Social cohesion is threatened by the conversion of rural to urban land as former farmers are often left dissatisfied with the low compensation they receive when their land is expropriated. This often leads to discontentment within rural communities and violent standoffs between farmers and local governments.  

What causes urban sprawl?

While studies have identified a vast range of factors — zoning regulations, floor area ratios limiting the height of buildings, urban design preferences for wide roads and residential “superblocks,” and the absence of property taxes to incentivize developing vacant land, to name a few — two of the biggest factors are connected to policies that divide China into urban and rural categories.

Factor 1: “Apartheid without the racism”

The household registration, or hùkǒu (户口), system contributes to the low density of Chinese cities by creating barriers to urban migration and incentivizing people to remain in their rural places of origin.

Described as China’s “apartheid without the racism” and the “most consequential original sin” of the planned socialist era, the household registration system was established in 1958 to control internal migration and ensure agricultural production. Citizens are assigned a permanent residency status tied to a particular place and with an urban or a rural designation. Those possessing a local urban hukou are entitled to social services, such as welfare, healthcare, pensions, and access to education, while land cultivation rights are given to rural citizens.  

While migration controls have loosened, and the hukou system has undergone several bouts of reform since the 1980s, the right to subsidized social services remains tied to one’s place of hukou registration. The near impossibility for migrant workers to acquire an urban hukou and the consequent lack of access to social services are strong disincentives to migrating to the city.  

The lack of access to public services is not the only disincentive to leaving the countryside. Rural hukou holders are entitled to land cultivation rights, allowing them to cultivate land for profit. While rural hukou holders can rent out their land if they decide to move into the city, they run the risk of the government reallocating the land in their absence. Rents tend to be very low, and many rural residents deem it more economically sound to remain in the village, or for at least a portion of the family to do so.

Factor 2: A “dual-track” land system

China’s “dual-track” system of land ownership, where farming collectives hold usage rights over rural land, and urban land remains under the ultimate ownership of local governments, works in multiple ways to drive the outward expansion of urban areas.

First, farmers lack bargaining power for land compensation, making them easy for local governments to exploit. Those same governments face economic and financial pressure, meaning they’re incentivized to expropriate cheap rural land and then sell the leasing rights to developers and investors. Development on converted land then contributes to economic growth targets, boosts longer-term tax revenue, and helps finance infrastructure projects.

Similarly, local governments can use this land as collateral to secure loans in order to further bridge revenue shortfalls and meet costs in other areas.

The World Bank has stated that these conditions have led to excess land conversion and the proliferation of large economic development zones and cheaper residential complexes along urban outskirts. Low-income rural migrants who have to pay extra for social services and those wanting to enter the property market are then incentivized to live in the lower-cost areas away from the city core and closer to new employment opportunities, further dispersing the population away from the urban center.

What are authorities doing about it?

The central government has recently announced measures to combat urban sprawl and encourage urban migration, but without adequate funding for implementation, it’s unlikely these measures will change much.

More significant are the changes to the hukou system that central authorities announced in December 2019. These changes call for the hukou system to be relaxed in cities with populations of 3 million to 5 million, and would see it removed in cities with populations under 3 million. Cities with populations over 5 million would retain an unspecified “simplified” version of the hukou system.

Bloomberg observes that, in theory, this would dismantle the hukou system across much of China. Sociologist Wang Feng goes as far as to say, “Such a move will no doubt increase labor mobility, usher in new economic dynamism, and reduce a type of social inequality that has plagued China for over half of a century.”

Yet such optimism is likely premature. Local governments have gotten no funding to carry out these changes.

Given that local governments remain responsible for funding social services, and that many face increasing levels of debt and reduced revenue intakes, it is unlikely that they will rush to implement policies that would encourage increased migration and burden them with greater costs. Nor are the residents of China’s richest cities enthusiastic about sharing their schools and hospitals with millions of arrivals from the countryside.

Similarly, while the central government continues to pay lip service to increasing the property rights of rural hukou holders and has begun to take steps to address some of the incentives that prompt local governments to expropriate excess rural land, it is yet to roll out a comprehensive overhaul of its land ownership system that would effectively slow or limit the conversion of rural land and remove barriers to urban migration.

In the absence of a comprehensive set of fully funded reforms that properly address urban and rural inequalities, uneven and fragmented urban sprawl looks set to characterize Chinese cityscapes well into the future.

Further reading: 

• On the road / MacroPolo
• Endless cities: Will China’s new urbanization just mean more sprawl? / Guardian
• Ghost Cities of China: The Story of Cities Without People in the World’s Most Populated Country / Wade Shepard (Zed Books)
• Making space: Surviving sprawl / Economist Intelligence Unit
• The great sprawl of China: Timelapse images reveal 30-year growth of cities / Guardian
• The Myth of Chinese Capitalism: The Worker, the Factory, and the Future of the World / Dexter Roberts (St. Martin’s Press)