Border Effects and Urban Development in China’s Borderlands in the Context of Integration

When population and industry move toward and concentrate in a particular geographic location, it marks the beginning of urbanization from an economic standpoint. Once begun, urbanization accelerates until congestion costs outweigh the benefits of agglomeration. Individuals tend to concentrate in cities because they offer more employment opportunities. Firms opt to locate in cities because they have better industrial support facilities and stronger forward and backward linkages. Urbanization is essentially the concentration process of factors of production in a certain location with increasing returns.