School of Economics

Feature on Lin Ma, Assistant Professor of Economics
School of Economics, Singapore Management University

Reading the road signs of urban city development 

How do we know the best size for a city and, even if we do know, how do we reach that size while enhancing the well-being of residents?  Assistant Professor Lin Ma uses data from high-growth cities to find the answers.  

Urban growth is a conundrum for inhabitants as well as planners. ‘Is bigger better?’ we might wonder as we push our way into a crowded train to work. Even while squeezed among the other commuters, we might wish for the things that come with more people, such as better job options or a better arts scene. A policy maker arriving at work, meanwhile, might ponder whether a new road to a growing suburb will make life better or worse for the retailers there. A few floors above, a politician might practice a speech on immigration policy. All three characters are essentially grappling with the same issue: how do we balance urban growth with quality of life? 

Revealing the numbers and patterns that answer this question is Lin Ma, Assistant Professor of Economics and Lee Kong Chian Fellow at the SMU School of Economics. He turns data about the flow of people and transport into insights that help planners know whether to open or slow the flow of people into cities, and even how to guide those flows through transport networks.

An expert in urban economics, Ma focuses on ‘destination cities’–those which attract migrants—and how to ensure they grow in a way the promotes the residents’ social and economic well-being. He arrived at the frontiers of urban development through the more traditional economics subjects of international trade and globalisation. “Over time, I tilted from the mobility of goods towards the mobility of people, particularly in the context of China” says Ma, who himself was raised in Beijing before spending seven years as in the United States.   

Now at the SMU School of Economics, he traces migration flows and, most recently, the evolution of transport networks, to unravel the factors that make cities grow and work.  

“Urban economics tells us how everyday life—getting around the city, an affordable house—is connected and how one thing affects the other,” says Ma. It’s an exciting time to study these dynamics, says Ma, because the available data is richer than ever before. His data mostly stems from China, which he likens to a goldmine for empirical and qualitative research. 

“To study how policy or infrastructure affects urban development we need to observe change,” Ma says, noting that there has been little such change in the infrastructure of Europe and the United States in recent decades. In contrast, China has changed dramatically, with its urbanisation rate increasing from 10 percent to 50 percent in recent times. “China’s growth not only gives us variations to study, but they also document it enthusiastically. There are records and data about everything,” he enthuses. 

Mega-cities under the microscope 

The rich economic stories of cities like Beijing and Shanghai, each having doubled their size in less than a decade, informs complex topics such as immigration policy. To help pinpoint the right balance of pros and cons, Ma developed a spatial equilibrium model, which identifies optimal city-size by looking at migration-fuelled productivity and downsides such as congestion. He developed the model with Assistant Professor Yang Tang from the Nanyang Technological University. They reported their research in the paper “Geography, Trade, and Internal Migration in China”. 

“We found that even though inhabitants may face greater levels of congestion and higher housing prices, there is still a 90 percent improvement in their overall levels of welfare. In Beijing and Shanghai, for example, we estimated that number is around sixteen million. Any larger and the congestion factor might dominate,” explains Ma. 

But we also need to look beyond the mega-cities, says Ma. “Growing cities have positive spillover effects for neighbouring places. Mega-cities produce goods cheaply and these benefit smaller cities along the same supply chain.”  

Incorporating around 300 cities within China, the model also computes the optimal size of cities from a national perspective. “If the aim is to maximise national welfare, the positive spillover effect for other cities in the supply chain would bump up the optimal size of Beijing and Shanghai to around twenty-two million,” says Ma. The model illustrates the divergent interests between local and national governments. “Without the national picture, Beijing or Shanghai local planners might prefer a smaller size,” he adds. 

Roads to or away from growth?   

Transport networks—such as roads and railways—profoundly affect the movement of people. Even with the right migration policies, you need to design transport networks that move people and affect neighbourhoods in the way that you intend. Ma studies the distributional impacts of the new roads which stretch across China’s immense economic regions in a recent working paper, “The Distributional Impacts of Transportation Networks in China”, together with Assistant Professor Yang Tang from Nanyang Technological University. 

“A new highway will almost certainly benefit the main cities connected by the route, but the benefits for smaller in-between locations is uncertain. Increased connectivity can deliver new goods and ideas, or can send people and their money to larger cities,” observes Ma.  

To bring evidence to such important transport decisions, Ma is building a significant data set that traces the evolution of China’s transportation networks, tracking the emergence of roads and railways at the pixel level, over time. “The data set will enable empirical work for theoretical frameworks to help design transportation networks,” he explains, with an eye to the future.