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Globalised growth in largely agrarian contexts: the urban–rural divide

Working paper 101

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Anirudh Krishna
The gulf in living standards is widening between cities and rural areas of developing countries that have large rural populations. Legacy as well as emergent factors contribute to this trend. An old urban bias from colonial and post-independence times was supplanted by a newer metropolitan bias as global investments began to arrive on these shores. More poorly served by social and physical investments, individuals in rural areas are less well prepared to compete for the better positions. Trends in the technology of manufacturing processes are worsening the prospects for rural youth. Citizenship bonds between the urban rich and the poor in rural areas are fraying as widening differences in lifestyles and aspirations, overlaid on existing inequalities, are cleaving societies into disparate segments of space-age rich and stone-age poor residents. Managing their vastly unequal situations within a common framework of policies and laws is making the tasks of a development state more difficult. This paper examines the forces giving rise to urban-rural inequality and presents the need for institutional and policy reforms.