ABSTRACT
This chapter presents some stylized facts about decentralized urban development, focusing on tradable goods and services. Cross-sectional observations suggest that wealthier and more populous countries tend to have more even urban population distributions than do other countries. Similarly, urban deconcentration has been found to be positively correlated with natural resource-oriented activity in the economy and local autonomy within the prevailing political system. Urban outputs can be differentiated, for analytical purposes, into goods and services traded across microregional boundaries and commodities produced and consumed locally. Cities are prequalified by local government endorsement of the project, creation of project preparation staff, and approval of fiscal and management measures acceptable to the central project office and required for effective project execution and debt repayment. The chapter suggests that direct location instruments be considered very selectively and that indirect mechanisms be relied on more heavily. Early economic development is constrained by the quantity and quality of human and capital resources available to the economy.
