The article provides useful insights into urban growth trends, esp. in developing countries. But I was a bit surprised to see "Randstad" and "Rhein-Ruhr" listed as cities. These are actually "conurbations" or urban regions/clusters, but surely not the only ones worldwide? Doesn't this approach mix apples and oranges?

Could FP run spell check before posting articles?
"Futhermore"?

There is one critical factor that could upset predictions. That is, different regulatory approaches to development, can result in land prices being driven up independent of growth in income or GDP.

Many cities in Southern and Central States of the USA have a light regulatory regime that keeps land prices low on the fringe, and hence lower throughout the city. These cities, and others around the world that manage to retain the low-cost land advantage, will unexpectedly out-perform those that do not.

In fact, I believe that unless the Chinese and Indians learn to reform their process of regulating develoment to prevent absurd price bubbles akin to the Japanese one of the 1980's, their economic miracle will de-rail. Remember "one block of Tokyo" being "worth more than the whole State of California"? This was ridiculous - its earning potential could not possibly have exceeded the State of California. The same thing is happening in Chinese and indian cities today.

There are problems with regulations driving land prices up in many US coastal areas too, this probably contributed the biggest DOLLAR losses to the Wall Street Crash (in contrast to the larger numbers of LOW value mortgages in places like Atlanta). But China and India have much worse corruption problems than California, at least so far. (Giving local regulators the amount of power that some in California and Oregon have, is not wise).

The other FP article about "arrival cities" points out some examples where much of the population are 'locked out" of the economic growth process; this is because regulations have pushed the price of "LEGAL" housing and accomodation out of reach of the most. Alain Bertaud is probably the best expert in the world on all this.

The following effects apply when cities have inflated land prices, from the fringe inwards, with the historically normal connection with income and GDP broken (note the reverse effect applies, as an advantage, to cities that do NOT have inflated land prices). I justify every one of these points with further explanation and evidence.

Increased land price cyclical volatility.

Actual cost to businesses, of land and rents.

Labour productivity reduced by per-worker space constraints in most industries.

Reduced efficiency of urban form and transport patterns (contrary to popular belief); reduced location efficiencies captured by households and businesses.

Cost-of-living pressures leading to workforce wage demands (in contrast to the business sector’s reduced ability to meet those demands).

Serious inter-generational inequities; incumbent land owners experience a one-off increase in “wealth” and become a constituency against reform while unprecedented costs fall on the oncoming generations.

Increased homelessness, hopelessness in youth, and other social pathologies.

Increased inequality and reduced social mobility, and increased “ghetto-isation”, including of racial groups.

Loss of international competitiveness.

Reduced “churn” of land use, and increased incumbency advantage leading to oligopoly effects and loss of potential efficiency gains.

Diversion of capital from productive uses, to land price bubbles (it is typical for banks lending portfolios to “flip” from one-third mortages: two-thirds business lending; to the other way around).

Reduced business start-ups (the major source of new employment), and newcomers locked out of participation in agglomeration efficiencies.

REDUCED discretionary household expenditure on non-mortgage items, including on items that would benefit children.

Inequitable, income-related "sorting" of living space, convenience of location, participation in social amenities, enjoyment of nature, and "peace".

Increased cost to government/taxpayers of the cost of land for social amenities and infrastructure, and for government buildings.

Increased opportunity cost of "green space", conservation, and heritage land.

Demographic-economic pressures: cost of living and "space" pressures on younger generations result in reduced birth rates.

Reduced replacement of substandard old homes and buildings, overcrowding in substandard accomodation, health issues.

Reduced ability to recover from serious negative economic impacts and disasters