Structural transformation involves the movement of workers from low-productivity sectors (such as agriculture), to high-productivity (industrial, urban-based) sectors, leading to job creation, improved labour productivity and poverty reduction.
In much of Africa, urbanisation has taken place without structural transformation, leaving high numbers of city dwellers trapped in low-productivity informal employment. To create growth and reduce poverty, it is therefore essential to disentangle the connections between cities and structural change.
ACRC will look at how key city systems – including urban planning, infrastructural service provision (such as transport, energy, water and waste management), productivity-enhancing policies and regulatory frameworks, and educational and technology accumulation strategies – need to be pulled together to facilitate structural transformation. Our approach considers how the political economy of cities affects the potential for structural transformation. Success requires ruling elites to commit to investing in the public infrastructure necessary for firms to operate productively, and to building productive state–business relations. This can stand in tension with the incentives to extract rents from firms and household enterprises and to enter into collusive relationships, such as offering subsidies and contracts in return for political and personal financing.
LATEST NEWS from ACRC
Fostering resilient and inclusive urban development in Freetown
The Freetown uptake workshop on 23 March 2023 examined how to integrate research evidence from ACRC Freetown city studies into processes and activities to achieve congruence between policy actions and urban transformation practices and programmes in the city.
Community knowledge: Pushing the frontiers of research in Harare
Democratising research processes has long been a contested subject. While co-production of knowledge presents vast opportunities for positive development outcomes, urban research processes often continue to exclude and marginalise vulnerable groups.
Building cities for all (not the privileged few)
Economists have long claimed there is overwhelming evidence that urbanisation unlocks the potential for economic growth and, from this, development. They point to the fact that no country to date has reached middle-income status without undergoing an urban transition.