The Impact of Urbanization on Economy

DOI

10.2991/978-2-38476-585-0_94How to use a DOI?

Keywords

Urbanization; Economy; Digital Technology

Abstract

Urbanization has become one of the defining forces shaping the global economy in the twenty-first century. More than half of the world’s population now lives in urban areas, and this trend is projected to accelerate in the coming decade, is this transformation more visible than in China, where the urbanization rate rose from less than 20% in 1978 to over 65% in 2023. This paper explores both the positive and negative impacts of urbanization on economic growth, industrial restructuring, and regional development. On the positive side, urbanization enhances labor market efficiency by improving job matching, supports industrial upgrading through labor reallocation from agriculture to manufacturing and service, and fosters technological innovation and entrepreneurship within urban clusters. Population growth will also stimulate investment in housing, education, healthcare, and infrastructure, directly Gross Domestic Product (GDP) growth. On the negative, however, rapid urbanization places heavy pressure on land, water, and energy resources, while industrial activity and transportation emission exacerbate environmental degradation. Social expenses are increasing with accelerated housing expenses and trailing behind in public service while territorial inequality spreads between coastal city-developed regions and inland areas. Grasping such trends is critical for decision-makers, this paper contributes by connecting recent literature and facts in an attempt to make certain policy recommendations for sustainable inclusive urbanization.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Lele Cui
PY  - 2026
DA  - 2026/06/18
TI  - The Impact of Urbanization on Economy
BT  - Proceedings of the 2025 International Conference on Hybrid Commerce, Human Capital, and Economic Dynamics (ICHCH 2025)
PB  - Atlantis Press
SP  - 836
EP  - 843
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-2-38476-585-0_94
DO  - 10.2991/978-2-38476-585-0_94
ID  - Cui2026
ER  -