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close this bookEmerging World Cities in Pacific Asia (UNU, 1996, 528 pages)
close this folderPart 2. Changing Asia-Pacific world cities
close this folderGlobalization and the urban system in Taiwan
View the document(introductory text...)
View the documentIntroduction
View the documentThe nature and development trend of the national urban system
View the documentStructural change
View the documentThe spatial dimension of economic structural change
View the documentThe international dimension of the urban system
View the documentThe impact of globalization on the mega-city of Taipei
View the documentPolicies and policy implications
View the documentConclusion
View the documentNote
View the documentBibliography


There has been a close association between the growth of exports and urbanization in Taiwan, because export growth has stimulated industrialization, and industrialization has spurred further urbanization and the formation of a national urban system.

Taiwan is endowed with only a small amount of land and limited natural resources. Nevertheless, the island has achieved an economic miracle that is widely admired. During the past four decades, the government has adopted a variety of policies and strategies to promote Taiwan's economic development. In the years immediately following the retrocession of Taiwan to the Republic of China, the government wisely channelled US aid to investments that provided the basis for further development and helped stimulate the growth of agriculture. Support from agriculture fostered the take-off of industry, which, in turn, provided positive feedback to agriculture. Within a relatively short time Taiwan had an agricultural surplus to sell abroad. Strategies for the development of labour-intensive import-substituting industries and the establishment of export-oriented industries were later introduced to promote industrialization. Rapid industrialization, in turn, has been the driving force behind urbanization and urban growth.

According to the cumulative causation concept proposed by Jaffe (Jaffe and Stewart, 1951), "As commercial and manufacturing activities greatly expand, it becomes necessary for a much larger proportion of the population to assemble in large aggregations in cities, for only in that way can these activities be carried on efficiently. The large-scale growth of urban centres, in turn, is one of the elements that affect the rate of population growth." In Taiwan's case, a city tends to develop wherever an export-oriented industry is located.

The liberalization of world trade since the late 1950s has stimulated demand for exports manufactured in Taiwan. This helped Taiwan gain a foothold in world markets, making export-oriented industries the engine of Taiwan's industrialization. Furthermore, technology can be transferred easily, either by technical cooperation with foreign companies or through overseas investment. Such transfers have been another source of Taiwan's industrialization. Both export-oriented and technology-intensive industries are urban oriented and have created job opportunities in urban areas.

Population has thus been attracted to the cities, speeding the process of urbanization. In addition, overseas capital has flowed into urban infrastructure, housing, power, and transportation. Urban living conditions have been improved and living standards raised, further augmenting the growth of cities.

This chapter first presents a brief sketch of the national urban system in Taiwan, and then describes the macro-structural change in population and employment. It then examines the spatial dimension of economic structural change and the international dimension of the national urban system. An analysis of the impact of globalization on the mega-city of Taipei and its policy implications is also provided.