Population management system evolves with urbanization

By CHEN BO / 03-11-2021 / (Chinese Social Sciences Today)

A policeman hands a Residence Permit to a resident in Taizhou, east China’s Zhejiang Province. The current residence permit system gives the migrant population equal access to many public services in cities. Photo: CFP 

Population is a key factor of urbanization, and population management is crucial to the modernization of governance amid urbanization. After the reform and opening up, China has undergone rapid urbanization, developing from a rural country into an urban one. 
In this process, the spatial pattern for urbanization and the quality of construction have continued to improve, while new strides have been made in the integrated development of the countryside and cities. Along with urbanization, the population management system has been constantly evolving. Aligning population management with the urban transition will help ease tensions between pursuing dividends of scale (as a result of urban aggregation) and providing public services, thus bolstering the modernization of social governance. 
Logic of evolution 
The core feature distinguishing cities from the countryside is the urban aggregation effect, which is not only the force driving urban transitions, but also the source of problems in urban population management. 
On one hand, economies of scale lure the government to increase financial inputs, enterprises to pour in, and populations to cluster in cities. On the other hand, cities aggregate demands for public goods and services. Whether in terms of quality or diversity, the demands for public goods in cities are incomparably huge when measured against rural areas. From this perspective, the modernization of urban population management should be grounded in the logic of resolving contradictions between economies of scale and public services by adjusting the population management system, so as to generate positive endogenous impacts. 
Cities’ aggregation effects and economies of scale are a power source for urban transitions. The aggregation of population and production factors within a limited geographical space can not only realize economies of scale through sharing, matching, and learning to boost productivity and economic growth, but also reconstruct the process of capital rotation to consume residual capital. Therefore, urbanization can be regarded as a process of aggregating population and production factors. The spatial agglomeration fosters unique lifestyles, cultural psychology, social features, and organizational characteristics within urban spaces. 
Obviously, the aggregation of population and production factors is unlikely to continue ceaselessly and uncontrollably. First of all, aggregation is restricted by the region’s natural bearing capacity. Chasing scale dividends necessitates ever more detailed urban governance, and more rational economic and industrial structures to minimize the negative externality of aggregation. In addition, populations have to pay congestion costs when enjoying benefits from aggregation, so urban managers should guide population migration through administrative interventions to optimize the scale of aggregation and regional distribution. 
Moreover, many population management problems are rooted in cities’ aggregation and public services. Infinite social demands and limited public goods supplies and services are in a permanent conflict. The population influx and expansion of production increase the demands for public services both in scale and quality, while environmental depletion caused by production and lagging distribution abilities are raising costs for the supply of public services. All these problems are testing the governance capabilities of urban governments. 
At the same time, this struggle has also revealed two relatively clear solutions. The first is to divorce various benefits from the household registration (hukou) system through market-based reforms, to make population migration and aggregation more in line with market laws. Second, it is essential to bridge treatment gaps between urban and rural residents, and between locals and nonlocals, to realize orderly and progressive urbanization, thereby striking a balance between the pursuit of economies of scale and the provision of public services. 
Evolution of population management 
From spatial perspectives, Chinese cities were originally designed for production and construction purposes, but now their aims for people’s lives and consumption are increasingly apparent. Cities have turned from a vessel for industrial construction into an economic growth machine, and will develop into a space for people to seek a better life.
Accordingly, the core of population management has altered significantly, as the population has changed from serving as a resource, which was allocated by administrative means amid industrialization, into production factors aggregated with the development of a socialist market economy, and further into urban subjects that demand a response to, and satisfaction of, their needs. 
Generally, population management has gone through four stages in China. The first stage was industrial urbanization, which focused on the management and control of production factors in the industrial vessel after the founding of the People’s Republic of China in 1949. To review population management in this stage, it is necessary to place it in the historical background of the planned economy, a system implemented to reinvigorate heavy industry, and rebuild state order and social order. 
In the planned economy era, under special historical conditions, such as a low base point for modernization, intensive material and population control were needed to lower the threshold for heavy industry’s formation of capital, promoting urbanization through strict central planning. 
During this period, the site, scale, and speed of urbanization followed strategies from the central government and were based on Marxist urban theories. Cities at that time were vessels for industrial construction. As an important factor within cities, the population should naturally observe stringent central plans. 
Therefore, urbanization was a kind of industrial urbanization. Construction and production were the predominant goals of cities, and the city’s function of meeting citizens’ diverse life and consumption demands was not complete. In the meantime, the rigorous hukou system, planned purchase and marketing by the state, agricultural collectivization, and the people’s commune system blocked the thorough flow of population and production factors. Dividends of scale were not fully unleashed in this stage. 
The second stage, market urbanization, concerned the regulation of population factors in urban management. After the reform and opening up in 1978, economic decentralization and the implementation of the tax distribution system greatly incentivized territorial governments to develop local economies, expanding the urban economic scale and advancing the spatial aggregation of population and production factors. 
Thereafter, reforms to commercialize housing spawned cities’ consumption attributes. Major changes took place in Chinese municipal governments’ operational strategies. They invested the profit from industrial outputs into urban infrastructure construction, and capitalized on land to acquire funds for urban construction and production expansion. 
Such strategies highlighted the operational feature of Chinese cities. Urban spaces turned from a construction space in the planned economy age, into one for capital rotation and economic growth, producing dividends of scale. 
In this stage, the focus of population management shifted from managing population flow to governing the migrant population. At this time, a series of systems were instituted such as self-supplied food grain (zili kouliang) hukou, blue-stamp (lanyin) hukou, and temporary residence permits, all the way to the current residence permit and point-based household registration systems. 
Population urbanization in the third stage aims to meet citizens’ demands amidst balanced development in the new era of socialism with Chinese characteristics. The central government’s policies, which are oriented towards people’s livelihoods, are being adjusted to demographic changes, pushing local governments to enlarge the number of urban residents by stepping up efforts to “citizenize” (shimin hua) farmers and reduce barriers for urban household registration. 
In light of the policy guideline since the 18th CPC National Congress, rectifying developmental imbalances has been raised to a position of unprecedented importance. Emphasis on the supply of people’s livelihoods and social equity has changed local governments’ motives in the performance competition. 
Meanwhile, a shift in intergenerational cycles among migrant workers, demographic changes, and the relaxing of the hukou system have motivated people to migrate rationally and triggered a push for population growth among many big cities in recent years, bringing policy changes to population management in the new era. 
Since 2014, the central government has released a range of policies, associating the scale of urbanizing rural migrant populations with fiscal incentives and state-owned construction land quotas, and modifying the criteria for classifying cities by size. Furthermore, cities with a population of permanent residents under 3 million are required to remove all limits on household registration, and those with populations between 3 million and 5 million should relax restrictions on new migrants.
In response, governments at all levels have introduced policies to loosen control of household registration, accelerate the integration of local urban and rural areas, and expedite reform of the residence permit system. 
Based on global experiences, China is still in the stage of rapid urbanization, and population urbanization is a major impetus for the grand historical course. Since population management is embedded in the process of urban transition, it must address the tension between a pursuit of scale dividends and the provision of public services. 
Through trials during the evolution from industrial urbanization to market urbanization, population management in China has embraced higher starting points and newer requirements in the new era, which will advance the modernization of urban governance with people at the core. 
Chen Bo is an assistant professor from the School of International Relations and Diplomacy at Beijing Foreign Studies University.