4. Urbanization

The world reached a landmark in 2008 when, for the first time in history, more than half the population were now living in urban areas. Urbanization is naturally one of the most important aspects of the Great Transition from an Agrarian to an Urban Industrialized society. For those that live in cities, especially those dreaming of escaping the city, it can be all too easy to forget just how transformative cities have become for human civilization. What we also may fail to recognize is the truly staggering investments of resources required to build and maintain our cities. But we would do well to give it some thought. The next few decades will see an unprecedented scale of urban growth, and we need to build cities for another four billion people. That’s double the number we have today. If you consider the environmental challenges urban living generates already, then imagine the challenges when the world’s urban population doubles over the next forty to fifty years.

How did urbanisation begin?

When we look back 200 to 250 years ago, we can see how just like other aspects of the Great Transition, such as the demographic and dietary transitions, all countries go through an urban transition; some just start later than others, depending on which Wave they are in. Countries start with around 10-20% of their population in cities and end up with 80-90% living in cities.

Urbanization in 1st Wave countries took place very differently than in the countries of the 2nd to 4th Waves. In the 1st wave during the 19th century and first half of the 20th century, the structure of the agrarian economy and society began to change. In the 19th century, the inhabitants of villages and villages “left” (often they were expelled) to go to newly built factories. Sometimes this process was driven by the challenges of life in the countryside coupled with the hope of a better life. Sometimes it was driven by changes in land ownership rights. Other times it reflected the inability of a village or valley to feed its growing population. The reasons were different, but the result was that ever more people left the countryside for the newly growing cities. And while these challenges had been experienced before, there had been no alternative. Industrialization stimulated “de-ruralisation” by offering an alternative, prompting an exodus from the countryside to factories. De-ruralisation was accompanied by the expansion of industrial towns. In modern terms, these were slums. For the first time in history, the concept of a “labour force” appeared, people could now sell their labour for money in factories. Again to use modern terms, a gig-workforce appeared of day-labourers. Before that, for millennia, money was not needed in the rural economy. People ate what they planted or for what they exchanged part of their harvest and the landlords and the state would take a cut.

De-ruralisation and industrialisation was also made possible by the growing efficiency and productivity of the remaining rural population. This did not happen suddenly, but gradually townspeople could now more reliably acquire food from markets and shops rather than from their own lands. This trend became especially noticeable from the beginning of the 20th century due to mechanisation, diesel, electrification, the large-scale use of fertilizers and other factors discussed in the food long-read. This made it possible to increase the volume of food production at a rate exceeding population growth. Thus, throughout the 19th century in the 1st Wave, a new industrial sector in the economy gradually emerged and the share of agriculture in the economy decreased from more than 90% at the beginning of the transition to less than 50% by the beginning of the 20th century. This was accompanied by the emergence of a working class, which was formed through de-rurarianization.

This mass urbanisation transformed the role of cities. Cities at the beginning of the Great Transition in 1st Wave countries were not more attractive places to live. The difficult conditions were well described by authors as diverse as Charles Dickens and Karl Marx. The majority of urban dwellers initially were poor, despite the economic growth. But the urban poor of the 1st Wave countries became far wealthier two or three generations later. The same can be seen now in the 2nd Wave countries. Cities are the means through which humanity has been able not only to maintain larger populations but raise their standard of living.

Concrete, Electricity, and Automobiles as the Three Main Pillars of Urbanisation

Pre-1950s statistics are hard to come by. In 1800 even 1st wave countries were mostly agrarian, around 90% of the population was rural. In 1900 around 40% of 1st Wave populations had become urban, while the rest of the world remained almost entirely agrarian. In other words, there were only around 260 million urban dwellers in the world out of 1.6 billion. Of those 260 million, around 80% of them lived in cities in the 1st wave. This has changed rapidly. Urbanisation is now almost, but not fully complete, in the 1st Wave, and the other Waves are well on their way. However, increased agricultural productivity and the organisation of the workforce into factories alone were not enough to facilitate today’s levels of urbanisation.

At the end of the 19th century, important technological changes took place that created new possibilities for urbanization and the construction of cities and buildings. Industrial methods were invented for the production of steel (using coke) and the production of cement (Portland cement). The combination of these materials allowed the development of reinforced concrete, the main building material in use today. Reinforced concrete has become a revolutionary material for the construction of high-rise buildings, skyscrapers. Cities now could “grow up”. When we think of the iconic images of urbanization in the United States, we think of the skyscrapers. The first skyscraper was a 10-story building in Chicago and was completed in 1885, it was certainly not the last. The thousands of skyscrapers in the US were made possible by steel and cement and the electricity to power everything from lifts to lights. A second major innovation was electricity. It allowed not only lighted streets and homes, but also helped ensure the supply of water to buildings, drainage, elevators, and many other mechanisms. No less importantly, at the end of the 19th century, the automobile appeared and the era of “automobile cities” began. Automobiles and public transport allowed cities to expand outwards. And these three technologies have become the technological basis for large-scale urbanization across the world.

In 1900, the urban population of the 1st Wave did not exceed 40%. By 1950, urbanisation in most of these countries was above 50% and continued to grow to over 75% by 2019. Humans have become near-endemic to cities in post-agrarian societies. Meanwhile in the 2nd Wave, urbanization began around the middle of the 20th century and took place at a more rapid pace. 2nd Wave followed the 1st Wave model and technologies of urbanisation. If we look at 2nd Wave countries, such as China and Indonesia, their urban populations grew from around 12% in 1950 and have reached around 60% today. If we put that in absolute figures, China had only 65 million people in its cities in 1950. Now it has almost 900 million. China alone in the last 20 years has 400 million more people living in its cities, equivalent to around 40 New Yorks. According to government plans, it still plans to urbanize another 300 million. These are hundreds of millions of people being taken out of poverty. This shift is an integral part of the economic boom China has enjoyed. The same goes for Indonesia and other 2nd Wave countries.

Despite the growing urbanisation, it was not until the late 20th century that urbanisation became a government goal. Industrialisation may have been a goal for many years, but not urbanisation. However, gradually greater recognition was given to the importance of urbanisation for economic growth. As a result the governments of many 2nd to 4th wave countries set specific deadlines and targets for the pace of urbanization. Urbanization has become an integral part of the mega-transition and the level of urbanization is a great indicator of where the country is in the mega-transition. It is for this reason we can confidently project the high rates of urbanization in the countries of the 3rd and 4th waves in the 21st century.

How much of the world is still left to urbanise?

We know that half the world’s population is left to urbanise, people found mainly in the 3rd and 4th Waves. The urban populations of 3rd Wave countries such as Bangladesh, India, and Pakistan’s have reached around 35% today, from between 4% and 17% in 1950. We might reasonably expect them to reach around 80% urbanisation in the next half century. Considering the combined population of the 3rd Wave is likely to peak around 2.5-3 billion people, we can expect 3rd Wave countries to add another 1.5 billion urban dwellers. The 4th Wave countries have also already reached 35% urbanization, although this hides wide variations between 5% in some countries and 50% in Nigeria. Thus the 4th Wave alone looks set to add another 3 billion urban dwellers during the 21st century.

Unsurprisingly since the 3rd and now 4th Wave will see the bulk of urbanization over the next few decades, we are projected to see the world’s largest cities at the end of the 21st century to be from there. Here is a map to help. If today only three 1st Wave cities, Tokyo, New York, and Los Angeles remain in the top-20, then by 2100 not even 2nd Wave cities will remain in the top-20 cities, not even one from China. Multiple projections from reputable organizations, in fact, show that in 2100 the top-3 largest cities are all projected to be in Africa: Lagos, Kinshasa, and Dar El Salaam. If you cannot find them on a map today, then maybe you should start looking.

This map does not tell us that the cities of the 1st and 2nd Wave will get smaller. It only tells us that the cities of the 3rd and 4th Wave will be getting much, much bigger. The population of Lagos in 2100 will be around eighty-eight million, larger than 90% of countries today. In 1950 the population of Lagos was only 300,000! Today it is already at 21 million, seventy times larger in just 70 years. Kinshasa in 2100 will have 83 million inhabitants and Dar El Salaam around 74 million.

Nevertheless, many 1st and 2nd Wave cities will grow smaller. As discussed in the long-read on population, the 1st Wave have and soon the 2nd Wave countries will reach peak population. The falling birth rate will overtake the falling death rate. This means that many cities will become ever emptier. In Italy, for example, many towns are seeking to sell houses for a euro to try and reverse the trend. These cities will experience very different problems from those rapidly growing 3rd and 4th Wave cities. We can see how this might occur when looking at cities like Detroit. While Detroit’s population did not decline as a result of entering the 5th stage of the demographic cycle, the effect may be the same. Collapsing house prices and rising crime.

Why is urbanisation significant?

In the next half-century, the economic opportunities could potentially be equal to the opportunities of the last 150 years - including the combined growth of markets of the US, China, and Japan! This is also a major threat. We started the 20th century with 260 million urban dwellers and we reached 2.9 billion by 2000. By the end of the 21st century, we will reach 8 billion, requiring hundreds of new cities. And all these cities require a great deal of infrastructure to be built. These investments in infrastructure are a key driver of economic growth during a country’s Great Transition. Infrastructure investments create salaries and profits that then create opportunities for new businesses. The infrastructure itself then facilitates other businesses, a housing estate that brings new residents (customers) or a subway station that brings people to a shopping center. But for now, let’s focus on constructing the infrastructure itself. And there are three notable ingredients: steel, cement, and electricity.

We need to start with steel and cement as all too often when we think of consumption we think of domestic consumption. When cities are built, however, investments in infrastructure dwarf all other consumption. Steel and cement production grows along with growing urban populations, and then stabilizes once the urban transition reaches completion. Today global steel production is around 2 billion tons, almost half in China. This steel is used to build everything from the buildings people live and work in to the transport they travel in and much more. We now even have estimates based on China’s experience for just how much steel is needed per additional urban dweller, between 17-23 tonnes of steel. And as urbanization continues to grow, so does the demand for steel. The picture looks the same for cement. At least 50% of the world's capacity of steel and cement production was built during the last 25 years. In other words, production doubled. And we still need to urbanize at least 4 billion more people over the next 40 to 60 years. Thus, we can see that annual steel production will need to double again to meet both new and existing demand. This creates significant environmental pressures, the impact on Climate Change we will discuss in the Climate Change long-read.

Once cities are built, they also consume, and consumption per capita is far higher than for rural dwellers. Urban dwellers consume more of most things, as we saw in the previous long-read on the dietary transition, and we will see in the next long-read on energy. But we should note that urban dwellers consume around six times more energy than a rural dweller. This means that we can expect global electricity consumption to triple to meet demand in the 3rd and 4th Waves. For 10 billion people we might expect electricity demand to reach 60,000 TWh/year, up from 23,000 TWh today. This means we need more than triple the electricity production capacity! And that’s without new EV’s etc. As we will see in the energy long-read, we can expect a significant share of that to be from coal.

We should also note air conditioners and cooling appliances present a new global threat. Most of the 3rd and 4th Wave countries have climates far warmer than 1st Wave countries. As a result, projects show a rapid increase in the number of air conditioners in their cities from 1.5 billion units today globally to 5.6 billion in 2050 (and continue to grow thereafter). It is hard to imagine living in an apartment in a city on the equator without good air conditioners. You need the same air conditioner in your car, whether or not it is a Tesla. And we could expect the number of passenger cars to quadruple in the next 40-50 years. Business and consumers of 3rd and 4th Wave countries can also be expected to buy cooling appliances such as refrigerators. Today their food supply chains are underdeveloped, lacking the refrigerated lorries, storage, etc. Hundreds of millions of refrigerators will be sold in the 3rd and 4th Wave cities in the coming decades. Yet these appliances emit F-gases hundreds or thousands of times more aggressive than CO2.


Urbanization, as we understand it today, began only 100 years ago and we are only half-way through. But already it has transformed the planet. In the next 40-60 years, we can expect the world’s urban population to double; 0.5 billion from the 2nd Wave, 1.5 billion from the 3rd Wave, and 3 billion from the 4th Wave. This is inevitable and inescapable. That is, of course, unless there is no major disaster that prevents this from happening. Cities represent a far higher quality of life for these new urban dwellers with better incomes, diets, healthcare, and entertainment. But both urban living and the transition to urban living is highly resource-intensive, requiring vast quantities of steel, cement, electricity, cars, food, and much more. This will exacerbate the already immense pressures on our planet, pressures we will continue to explain throughout the remainder of this course.

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