IMPACT OF URBANIZATION ON THE ECONOMY

Urbanization is one of the most significant socio-economic transformations shaping modern economies across the world. It refers to the increasing concentration of population in urban areas and the expansion of cities due to migration, industrialization, and economic opportunities. This process has profound effects on economic growth, employment patterns, productivity, infrastructure development, and income distribution. Urban centers often act as engines of economic growth by fostering innovation, attracting investment, and improving access to markets and services. However, rapid and unplanned urbanization can also create economic challenges such as unemployment, pressure on public services, rising living costs, and regional inequality. This article examines the impact of urbanization on the economy by analyzing both its positive and negative dimensions. It highlights how urbanization contributes to economic development while also emphasizing the need for effective urban planning and policy interventions to ensure sustainable and inclusive economic growth.