ABSTRACT
The previous chapter identified the political and economic climate that led the Bank away from large-scale, infrastructure projects and toward social lending. Those within and outside the Bank who advocated a more socially oriented development approach generally welcomed this shift. A small minority within that camp, however, argued that the stronger concentration on rural development was misdirected, and would not succeed in adequately addressing the multifaceted socioeconomic problems that confront developing countries. This group was specifically concerned about increasing rates of urbanization in the developing world, and the resultant socioeconomic problems, which had hitherto escaped the attention of the major international development agencies. According to United Nations statistics, the aggregate increase in urban populations between 1950 and 1990 was approximately 430 million in developed countries, but 1.07 billion in the Third World – an almost threefold increase in absolute numbers, and an increase of 300 million in the 1970s alone (United Nations 1986). Owing to limitations in real income, the developing world’s growing urban population created enormous problems for infrastructure and service provision, leading to the prolific growth of slums and shanty towns. By the 1970s, about 30-40 percent of urban populations in Africa, Asia, and Latin America lived in these informal settlements (Todaro 1977).
