China’s economy moves towards balance in agglomeration

The 2021 annual meeting of Netease economists · summer Forum – young economists summit hosted by NetEase Finance was held in Shanghai on August 12. The theme of this forum is “new stage and new growth”.

Lu Ming, distinguished professor of Antai School of economics and management, Shanghai Jiaotong University, Changjiang Scholar of the Ministry of education and executive president of China Development Research Institute, said in his keynote speech on population mobility from the seven universals that China’s economic development is showing a trend of “moving towards balance in agglomeration”. At present, the scale gap between China’s GDP cities is at the level of Japan, but the concentration of population lags far behind the level of the United States or Japan. The bigger problem is that there is a gap between the level of population concentration and our GDP concentration. When the economy is concentrated but the population is not fully concentrated, the per capita gap between regions will become larger.

Lu Ming pointed out that the good news is that China’s population concentration is slowly rising, and the gap in per capita GDP between cities is gradually decreasing. In the process of a country’s economic modernization, there will be a so-called process of “moving towards balance in agglomeration”. The economy and population are concentrated in a few regions, but the per capita gap in different regions is narrowing.

In his opinion, from the perspective of economic law, there is not only profound economic truth behind “moving towards balance in agglomeration”, but also in line with international experience. China’s trend is good. On the one hand, economic agglomeration has brought benefits and innovation to overcome the trend of population aging and fewer children. On the other hand, there is a trend of narrowing the per capita GDP gap both nationally and locally.

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