G.1 The variety of urban environments

What makes a place urban

An urban area is a built-up area with a high density of buildings and people, where most residents work in manufacturing and services rather than in farming. Towns, cities and their suburbs are urban areas; villages and hamlets surrounded by farmland are rural. The process by which a growing share of a country’s population lives in urban areas is urbanisation.

Why definitions of urban differ

There is no single international definition. Each country chooses its own threshold, so the same settlement can be “urban” in one country and “rural” in another. Denmark and Sweden count settlements of 200 or more people as urban, the United States uses a threshold of 5,000 people (or 2,000 housing units) since its 2020 census, and Japan sets 50,000 for a city. Other countries use population density, the administrative status of a place (any settlement with a town council), or the share of the workforce outside farming.

India combines all three: a census town needs at least 5,000 people, a density of at least 400 people per km² and at least 75% of male workers outside agriculture.

Because of these differences, the share of a population counted as urban says as much about national rules as about the way people live. In 2020 the UN, the World Bank, the EU and other organisations agreed a common method, the Degree of Urbanisation. It divides the whole land surface into 1 km² grid cells, classifies them by population density and contiguity, and identifies cities (at least 50,000 people at a density of at least 1,500 per km²), towns and semi-dense areas, and rural areas. The UN’s World Urbanization Prospects 2025 Revision uses this method for every country, which is why its city populations differ from many national figures.

Site and situation

The site is the physical land on which the settlement is built: its relief, geology, soils, water supply and drainage. Early settlements chose sites that met everyday needs.

A defensive site on a hilltop or in a river meander was easy to protect, as at Edinburgh’s Castle Rock or Durham’s cathedral on a meander of the River Wear. A bridging point or ford was where a river could be crossed, as at London on the Thames. A confluence of two rivers gave water and routes in several directions, as at Khartoum on the White and Blue Nile. A spring line at the foot of a chalk escarpment supplied water, a natural harbour sheltered ships, and raised dry ground in a floodplain kept homes above the floods.

The situation is the settlement’s location in relation to its surroundings: other settlements, routes, resources and the wider region. A good situation gives access to trade and markets. Singapore’s site is a small, swampy island with little fresh water, but its situation at the southern end of the Strait of Malacca, on the main shipping route between the Indian Ocean and the South China Sea, made it one of the world’s busiest ports.

Site factors matter less as cities grow and technology overcomes them. Modern cities drain marshes, pump water from distant reservoirs and reclaim land. Mumbai began as seven islands joined by land reclamation, and Lagos has reclaimed whole districts from its lagoon and the Atlantic Ocean. Situation tends to matter more over time, because a city’s growth depends on its connections to national and global networks of trade.

Urban functions and land use

Urban functions

An urban function is an economic or social role that a settlement performs for its own people and for those of the surrounding area. Small towns often have one main function, such as a market town, a port, a mining town, a resort, a religious centre (Varanasi, Mecca) or a university town (Cambridge). A dormitory or commuter town is one whose residents mostly work elsewhere. Capitals have an administrative function, and a few cities have a global financial function, managing flows of money for the whole world economy.

Most large cities are multi-functional: London is a capital, a port, a financial centre, a university city, a tourist destination and a centre of culture and media. Functions also change over time. Manchester grew as a cotton-manufacturing city in the 19th century and is now a centre of services, universities and media.

Land use

Land use is the purpose for which an area of land is used. Geographers group urban land uses into a few classes so that cities can be mapped and compared.

Land use is recorded by a land-use survey, in which each building or plot along a route is classified and mapped. A transect from the CBD to the edge of a city records how land use, building height, building age and density change with distance from the centre, and is one of the most common fieldwork methods in urban geography.

The hierarchy of settlement

Settlements can be ranked by size and importance in a settlement hierarchy. The hierarchy can be built on population or on the number and range of services, and the two usually match: larger settlements have more services and serve larger areas.

From hamlet to metacity

A hamlet has a few houses and no services; a village has basic services such as a shop, primary school or place of worship; a town has a range of shops, secondary schools and a market; a city has specialised services such as hospitals, universities and department stores. Above about one million people a city is called a million city.

A megacity is an urban area of 10 million or more people. The UN counted 33 megacities in 2025, most of them in Asia, including Jakarta, Dhaka, Tokyo, New Delhi, Shanghai, Guangzhou, Cairo and Manila. UN-Habitat uses the term metacity for the very largest urban areas, with more than 20 million people, which often merge with neighbouring cities into one continuous built-up region.

At the top of a world hierarchy, defined by influence rather than population, are global cities: cities that act as command centres of the world economy, with the headquarters of transnational corporations, stock exchanges, international law and accountancy firms, and dense air and digital connections. The Globalization and World Cities Research Network (GaWC) ranks cities by the networks of advanced business service firms in them. In its 2024 ranking only London and New York are “Alpha++”; Beijing, Dubai, Hong Kong, Paris, Shanghai, Singapore, Sydney and Tokyo are “Alpha+”. Lagos, a megacity, is ranked only “Beta−”, which shows that population size and global influence are different measures.

Central place theory

The German geographer Walter Christaller proposed central place theory in 1933, from a study of settlements in southern Germany. It explains why settlements of different sizes are spaced in a regular pattern. A central place is a settlement that provides goods and services to the people of the surrounding area. Two ideas, also used to explain the catchments of leisure facilities, control how far apart central places are. The range is the maximum distance people will travel to buy a good or use a service. The threshold population is the minimum number of customers needed to keep that service in business.

Low-order goods, such as bread and newspapers, are bought often, have a short range and a low threshold, so they are sold in many small settlements close together. High-order goods, such as jewellery, specialist hospital care or a university degree, are bought rarely, have a long range and a high threshold, so they are found only in a few large settlements far apart. On a flat plain the market areas of central places become hexagons, because hexagons cover the whole area without gaps or overlaps while staying close to the ideal circle of a market area.

Strengths and limitations of the model

Primacy and the rank-size rule

In some countries the largest city is far larger than all the others. A primate city is one that is much larger than the next largest city and dominates the country’s economy, politics and culture. Bangkok, Lima and Paris are often given as examples. Primacy usually develops where one city was the colonial capital and main port, so that roads, railways, investment and government were concentrated there, and then grew further through agglomeration: firms locate where other firms, workers and customers already are.

The rank-size rule gives a pattern to compare against. It states that the nth largest city in a country has a population of 1/n of the largest city, so the second city is half the size of the first, the third a third, and so on.

Here $P_n$ is the population of the city of rank n and $P_1$ the population of the largest city. Countries whose cities roughly fit the rule have a balanced hierarchy with several large regional centres. A country whose largest city is much bigger than the rule predicts shows primacy. A common measure is the primacy ratio, the population of the largest city divided by that of the second largest; under the rank-size rule it would be 2.

Evaluating the rank-size rule

The rule is a simple description that fits some countries, not a law. It works best for large, long-urbanised countries with many regional economies. It fits poorly where a country is small (one main city is enough), where a colonial history concentrated growth in one port, or where a capital was moved.

The result also depends on how each city is defined: counting Lima with or without Callao, or Tokyo as its 23 wards or as the whole metropolitan region, changes the ratio. Primacy can give a small country one competitive international centre, but it often goes with regional inequality and congestion in the capital.

Planned and spontaneous growth

Cities grow in two ways. Planned growth is laid out in advance by a government or developer, with a street plan, zones for each land use and public services built before or with the housing. Spontaneous growth happens without an overall plan, as people and businesses add buildings one by one around an existing core, following old tracks, field boundaries and the lie of the land.

Planned cities

A planned city is designed as a whole before it is built. Many are capitals created to unite a country, move government away from an overcrowded primate city or develop an interior region. Brasília, designed by the planner Lúcio Costa and the architect Oscar Niemeyer, was inaugurated on 21 April 1960; its central Pilot Plan, shaped like an aeroplane, was planned for about 500,000 people. Canberra (Australia), Chandigarh (India), Islamabad (Pakistan), Abuja (Nigeria) and Putrajaya (Malaysia) are other planned capitals. Egypt is building a New Administrative Capital east of Cairo, and Indonesia began building Nusantara on Borneo in 2022 to take government functions from Jakarta.

Planned new towns also take growth from large cities, such as Stevenage and Milton Keynes (designated in 1967) for people moved out of London.

Spontaneous growth

Spontaneous growth produces the irregular street plans of most historic city centres, such as the medieval lanes of Fez, and of many fast-growing modern cities. In low- and middle-income countries much spontaneous growth today takes the form of informal settlements, built by residents themselves on land they do not legally own, usually on the edge of the city or on land unsuitable for formal building.

Most cities combine both. Planned extensions such as Haussmann’s boulevards in 19th-century Paris were cut through older organic cities. Planned cities in turn attract spontaneous growth: Brasília’s Pilot Plan has about 215,000 residents today, while the Federal District as a whole had about 2.8 million at the 2022 census, most of them in satellite cities that grew up to house the workers who built and served the capital.

The pattern of urban economic activities

Retail, commercial (office) and industrial activities are not spread evenly through a city. They concentrate where land is accessible and affordable for their needs, and the pattern changes as transport and planning change.

The central business district

The central business district (CBD) is the commercial heart of a city. In most cities it grew where routes met, so it is the most accessible point for the whole urban area. Its typical characteristics are:

• the highest land values in the city, as many users compete for the most accessible sites;

• tall buildings, built upwards to make the most of expensive land;

• offices, banks, government buildings and comparison retail (goods buyers compare before purchase);

• a low resident population, busy by day and quieter at night;

• the meeting point of public transport, with congestion and limited parking.

Within the CBD, land values peak at the peak land value intersection (PLVI), usually the junction of the two busiest shopping streets, where pedestrian flows are highest. Geographers also divide the CBD into a core, with the most intensive land uses (major shops, head offices), and a frame around it, with lower land values and uses that need more space, such as car parks, bus stations, warehouses and colleges.

Bid-rent theory

Bid-rent theory, developed for cities by the economist William Alonso in 1964, explains why land uses form a broadly concentric pattern around the CBD. Land users bid for sites according to how much profit or benefit they gain from being accessible.

• Retail gains most from accessibility, because its profits depend on large numbers of passing customers. It bids very high for central sites, but its bid falls steeply with distance.

• Offices and industry gain from accessibility to workers, clients and suppliers, but need fewer passing customers, so their bid curve is less steep.

• Housing gains least per square metre from central sites and needs more space, so its bid curve is gentler still.

• Agriculture bids least of all and occupies land beyond the urban edge.

The model also explains why building height and density fall outwards: near the centre, high land values push land users to build upwards.

Strengths and limitations of bid-rent theory

Bid-rent theory explains the general shape of land values better than the detail of any one city. It fits older, single-centred cities best and car-based, multi-centred cities such as Los Angeles least.

The location of retail

Shops form a retail hierarchy within the city, which repeats the logic of central place theory. The CBD, with comparison goods and department stores, is at the top; below it are district centres serving a suburb, neighbourhood parades serving a housing estate, and corner shops selling convenience goods within walking distance.

Since the 1970s retail has decentralised from the CBD. An out-of-town retail park or regional shopping centre is built at the urban edge, near a motorway junction, where land is cheaper, plots are large enough for big stores and car parks, and the centre’s congestion is avoided. Bluewater in Kent, which opened in March 1999 in a former chalk quarry near the M25 motorway and the A2, has more than 13,000 free parking spaces and draws shoppers from across south-east England.

Not every large mall follows the out-of-town model. The Dubai Mall, opened in 2008, is part of a planned new downtown district next to the Burj Khalifa, linked to the city’s metro, and was built as a central attraction for residents and tourists rather than a suburban convenience.

Online retail is the most recent change. It replaces some shopping trips, makes warehouses near motorway junctions a new retail land use, and has left empty units in many high streets, which are being converted to housing and leisure.

The location of commercial activities

Offices and business services have traditionally clustered in the CBD, gaining from agglomeration: face-to-face meetings, a large pool of skilled workers and the prestige of a central address.

As central rents rose, commercial activity also spread outwards. Secondary office districts were planned on cheaper land close to the old centre: Canary Wharf was built on former docks in east London from the late 1980s, and La Défense, just west of the city of Paris, is Europe’s largest purpose-built business district. In the United States, offices, shops and housing have grown together around motorway junctions far from the old downtown, creating an edge city such as Tysons in Virginia, outside Washington, D.C.

A business park is a planned area of offices and light industry in a landscaped setting, usually near a motorway or airport, with parking and good links for workers who drive. Stockley Park, next to Heathrow Airport, is an example.

The location of industry

The pattern of industry reflects the transport of each period. In 19th-century cities, factories, warehouses and mills were built close to the centre along rivers, canals and railways. Many of these inner-city industrial zones are now derelict or redeveloped.

Modern manufacturing and distribution prefer the urban edge. An industrial estate is a planned area of factories and warehouses on the outskirts, near ring roads, motorways or airports. Firms gain cheap land, room to expand and access for lorries.

A science park is a cluster of research-based and high-technology firms near a university, so that companies can use the university’s research, laboratories and graduates. Stanford Research Park in California, opened in 1951, helped create Silicon Valley, and Cambridge Science Park, opened by Trinity College in 1970, was the first in the United Kingdom.

In many middle-income countries governments have created zones that attract manufacturing for export. Export processing zones offer factories tax breaks and duty-free imports of components. A special economic zone is a larger area, sometimes a whole city, where more liberal economic laws apply to attract foreign investment; Shenzhen, beside Hong Kong, became China’s first in 1980. Port-industrial zones such as Rotterdam’s Europoort combine docks with oil refineries, chemical works and steel plants on reclaimed land at the river mouth.

Physical factors and planning

Physical geography shapes the pattern of economic activities in every city. Industry needs flat land for large buildings and railway sidings, and ports need deep, sheltered water. Activities avoid steep slopes and flood risk. In many European cities prevailing westerly winds carried smoke from factories to the east, so heavy industry and working-class housing concentrated in the “East End”, as in London, while wealthier districts grew to the west, upwind.

Planning often overrides the market. Zoning divides a city into areas where only certain land uses are allowed, separating industry from housing. A green belt is a ring of protected countryside around a city where new building is restricted, to stop urban sprawl and protect farmland; London’s Metropolitan Green Belt was proposed in the 1930s and formalised by planning policy from 1955. Governments also create enterprise zones with tax breaks to attract firms to declining areas (one was set up on the Isle of Dogs in London in 1982, before Canary Wharf was built) and have limited new out-of-town shopping centres to protect town centres.

Planning can override the bid-rent pattern: land just inside a green belt is very expensive, while land just outside it stays cheap farmland.

Other human factors include accessibility (sites by motorway junctions, stations and airports attract offices, shops and warehouses), historic legacy (old industrial buildings and street plans persist for centuries) and government incentives (grants and tax breaks for firms that locate in a chosen area).

The pattern of residential areas

Housing covers more land than any other urban use, and it is rarely mixed at random. Urban models describe residential patterns in simplified form; the factors that produce them are physical geography, land values, ethnicity and planning.

Urban models in high-income countries

The Burgess concentric zone model (1925)

The sociologist Ernest Burgess, working in Chicago, proposed the Burgess concentric zone model in 1925. He saw the city as a set of rings around the CBD, each with a different type of land use and population:

1. The CBD: offices, shops and main services.

2. The zone in transition: older housing invaded by factories and offices spreading from the CBD, occupied by the poorest residents and newest migrants.

3. The zone of independent workers’ homes: terraced housing for factory workers who need to live close to work.

4. The zone of better residences: larger houses for the middle classes.

5. The commuter zone: suburbs and villages beyond the edge, for those who can afford to commute.

The model is dynamic. Burgess borrowed the ecological ideas of invasion and succession: as the CBD and industry expand, they invade the zone in transition; as migrant groups become better off, they move outwards and their old homes are taken over by the next group of arrivals.

The Hoyt sector model (1939)

Homer Hoyt, who studied rents in 142 US cities, argued in 1939 that the city grows in sectors (wedges) along transport routes rather than in rings. The Hoyt sector model has a CBD at the centre, with sectors of wholesale and light manufacturing along railways, rivers and main roads. Low-class housing grows next to industry, while high-class housing grows out along the most attractive routes, away from industry.

The Harris and Ullman multiple nuclei model (1945)

Chauncy Harris and Edward Ullman argued in 1945 that large cities grow around several centres, or nuclei, rather than one. In the multiple nuclei model the CBD is only one nucleus; others include old villages swallowed by the city, a port, a university, an outlying business district or an industrial suburb. Some activities cluster because they benefit from each other, some repel each other (heavy industry and high-class housing), and some cannot afford the most accessible sites.

Mann’s model of a British city (1965) combines Burgess’s rings and Hoyt’s sectors, with wealthy sectors to the west, upwind of industry.

Urban models in low- and middle-income countries

The early models were built from cities in North America at a particular time. Many cities in Latin America, Africa and Asia grew under colonial rule and very fast, and their structure is in some ways the reverse: the wealthy live near the centre and the poor at the edge.

The Griffin and Ford model of the Latin American city (1980)

Ernst Griffin and Larry Ford based their 1980 model on cities such as Bogotá, Lima and Mexico City. The Griffin and Ford model has these parts:

• A CBD and market, often around the colonial plaza.

• A commercial spine running outwards from the CBD along a main boulevard, lined by offices, shops, restaurants and the elite residential sector, which often ends in a modern mall near the periférico (ring road).

• The zone of maturity: well-built housing with full services, partly older houses left by the elite as they moved out along the spine.

• The zone of in situ accretion: a mix of housing at different stages of being improved, self-built and slowly upgraded.

• The zone of peripheral squatter settlements: the newest and poorest informal settlements at the edge, built by migrants, with few or no services.

• The disamenity sector: the poorest areas, often on steep slopes, floodplains or beside railways and rubbish tips, running right into the centre.

The model includes change over time. As peripheral squatter settlements age and their residents invest in them, they become zones of in situ accretion and eventually zones of maturity, while new squatter settlements form further out. Ford’s 1996 revision adds gentrification near the centre and industrial parks.

The McGee model of the South-east Asian city (1967)

Terry McGee described the structure of colonial port cities such as Jakarta, Manila, Bangkok and Kuala Lumpur in 1967. In the McGee model the focus of the city is the port, not a single CBD. Around it are a Western commercial zone (the former colonial business district of banks, trading houses and offices) and an alien commercial zone, where Chinese and other migrant merchant communities ran shops and wholesale trade.

A government zone and areas of high-class residential housing occupy the best land. Between them lie extensive mixed land-use zones of housing, workshops and markets, with squatter areas scattered through the city and at its edge. At the periphery are new suburbs, industrial estates and market gardening.

Strengths and limitations of the urban models

All five models are static descriptions of particular cities at particular times, and none of them was meant to fit every city. They give a framework for asking questions about a real place: where does it match, where does it differ, and why? They ignore globalisation and government, and do not describe the multi-centred metropolitan regions in which most urban people now live. Geographers of the “Los Angeles school” in the 1990s argued that post-modern cities are fragmented into separate enclaves of wealth, poverty and specialised activity with no single organising centre.

Physical factors

Physical geography determines which land is attractive and which is hazardous, and in most cities the wealthy occupy the best land. The poorest households live on land others avoid: floodplains, steep slopes, marshes and sites next to railways, industry or waste dumps.

In Rio de Janeiro many favelas, such as Rocinha, occupy the steep granite morros (hills) between the wealthy districts of the coastal plain, where the slopes are prone to landslides in heavy rain. In La Paz, Bolivia, the pattern is reversed by altitude: wealthier districts lie in the lower, warmer Zona Sur at about 3,300 m, while lower-income migrants have settled on the cold, exposed plateau of El Alto above 4,000 m.

Land values

Bid-rent theory applies within the housing market. Near the centre, land is expensive, so housing is built at high density as flats and terraces, and households accept small homes in return for short journeys. Towards the edge, land is cheaper, so detached and semi-detached houses with gardens and garages are built at low density. In HIC cities middle-class families have often chosen space at the edge; in many LIC and MIC cities the wealthy choose accessibility near the centre and the poor are left with cheap land on the periphery, far from jobs.

Ethnicity

Residential segregation is the spatial separation of groups within a city, by income, ethnicity, religion or other characteristics. Segregation by ethnicity has two sources. Choice brings people together near family, places of worship and community organisations. Constraint keeps people apart through low incomes, discrimination by landlords, lenders or neighbours, and laws that restrict where groups may live.

An ethnic enclave is a district where one ethnic group is concentrated and has its own shops, services and institutions, such as the Chinatowns of San Francisco, London and Bangkok, or Brick Lane in east London. Enclaves grow through chain migration, as earlier migrants help relatives and neighbours from the same home area to follow them. A ghetto is a district where a group is concentrated mainly by constraint rather than choice, often with high levels of poverty.

Constraint can be built into law and policy. In 1930s US cities, federal maps graded neighbourhoods with Black residents as “hazardous” for mortgages, a practice called redlining that denied them loans for decades.

In South Africa the Group Areas Act of 1950 assigned each racial group to separate areas under apartheid. Black South Africans were moved to townships on the edge of the cities: Khayelitsha, on the Cape Flats far from central Cape Town, was established in 1985 as one of the last such townships, and had 391,749 people at the 2011 census, more than half of its households in informal dwellings. The pattern persists long after the laws were repealed.

Some governments act directly against segregation. Singapore’s Ethnic Integration Policy, introduced in 1989, sets quotas for the share of each ethnic group in every block and neighbourhood of public (HDB) housing, where most Singaporeans live, so that no block becomes an enclave.

Measuring segregation

The index of dissimilarity (D) measures how evenly two groups are spread across the districts of a city. It ranges from 0 (both groups have the same distribution, no segregation) to 100 (complete segregation, the groups never share a district). It can be read as the percentage of one group that would have to move to another district for the two groups to have the same distribution.

Here $a_i$ and $b_i$ are the numbers of each group in district i, and A and B are each group’s total in the whole city. Values above about 60 are usually described as high and below 30 as low. The location quotient for one district is a group’s share there divided by its share in the whole city.

Planning

Governments and developers shape where people live through housing policy. Social housing estates house large numbers at controlled rents, and new towns move people out of crowded centres. In LIC and MIC cities, slum upgrading improves informal settlements where they stand, a process called in situ upgrading, whereas slum clearance removes them. Zoning and green belts limit where new housing can go.

Private developers also plan residential areas. A gated community is a residential area enclosed by walls or fences, with controlled entrances, private security and often private services such as water, power and leisure facilities. They are especially common in Latin America, South Africa, Nigeria and China.

Poverty, deprivation and informal activity

Every city contains areas of wealth and areas of hardship. How much there is, what it looks like and where it is found vary with a country’s stage of development.

Poverty and deprivation

Poverty is a lack of the income or resources needed for an acceptable standard of living. Geographers distinguish two types. Absolute poverty means having too little income to meet basic needs for food, water, shelter and clothing. The World Bank measures its most severe form, extreme poverty, with the international poverty line, set at US$3.00 a day (in 2021 purchasing power parity) since June 2025, replacing the earlier US$2.15 line. Relative poverty means having an income well below the typical income of one’s own society, usually below 60% (in the EU and UK) or 50% (in the OECD) of the national median household income.

The two measures describe different problems. Absolute poverty is measured against a fixed standard of basic needs, so it falls as incomes rise; relative poverty is measured against each society’s own median income, so it remains even as a country grows richer. Absolute poverty is concentrated in the cities of LICs and lower-middle-income countries, while relative poverty exists in every city, including the richest.

Deprivation is wider than poverty. It is a lack of access to the goods, services, opportunities and conditions that most people in a society have: decent housing, good schools, health care, safe streets, clean air, jobs and transport. Most deprived people suffer several types at once, which is called multiple deprivation.

Measuring deprivation: indices of multiple deprivation

An index of multiple deprivation (IMD) combines indicators of different kinds of deprivation into a single score for each small area, so that areas can be ranked and mapped. England’s Indices of Deprivation, last published in October 2025, rank all 33,755 small neighbourhoods (lower-layer super output areas, each of about 1,500 people) on seven weighted domains:

Sources: Ministry of Housing, Communities and Local Government, English Indices of Deprivation 2025: statistical release, 2025.

The 2025 release shows clear spatial patterns. Middlesbrough, Birmingham, Hartlepool, Kingston upon Hull and Manchester have the highest shares of neighbourhoods in England’s most deprived tenth, and Blackpool has the highest average deprivation of any local authority. Deprivation is concentrated in conurbations, former heavy-industry towns and coastal towns: 11.7% of urban neighbourhoods are in the most deprived tenth, against 1.3% of rural ones. Within HIC cities it is typically highest in inner-city areas and on peripheral social-housing estates.

The pair of maps shows why the choice of comparison matters. A national ranking guides national funding; a ranking within the city picks out where local action is most needed. Both maps are choropleth maps, which shade areas by the value of a rate or index, never by an absolute number.

Informal housing

In many cities of low- and middle-income countries the largest areas of deprivation are informal settlements, built by residents themselves without planning permission or legal title to the land. UN-Habitat defines a slum household as one lacking one or more of five things:

• durable housing of a permanent structure that protects against the weather;

• sufficient living area, with no more than three people sharing a room;

• easy access to improved water in sufficient amounts at an affordable price;

• access to improved sanitation, such as a private toilet or one shared by a few households;

• security of tenure that protects against forced eviction.

In 2022, 1.12 billion people lived in slums or informal settlements, 24.8% of the world’s urban population and 130 million more than in 2015. The largest numbers were in Eastern and South-Eastern Asia (362 million) and Central and Southern Asia (334 million), but the highest share was in sub-Saharan Africa, where 53.6% of urban residents lived in slums.

Sources: United Nations, The Sustainable Development Goals Report 2024, Goal 11, 2024.

Informal settlements form where cities grow faster than governments and formal developers can supply affordable housing and services, mainly through rural–urban migration and natural increase. Migrants build on land that is free or cheap because no one else wants it: steep slopes, floodplains, the edges of railways and canals, waste dumps and public land at the periphery. Many improve over time as residents invest, the process Griffin and Ford call in situ accretion.

Informal industry and the informal sector

The informal sector (informal economy) is economic activity that is not registered, taxed or regulated by the state, such as street vending, waste picking, home-based manufacturing, rickshaw transport and domestic work, without contracts, minimum wages or pensions. The International Labour Organization estimated in 2018 that about 2 billion people, more than 61% of the world’s employed population, worked informally, 93% of them in emerging and developing countries; in Africa the share was 85.8%.

Informal industry is often concentrated in the same districts as informal housing, so that homes are also workplaces. Dharavi, in central Mumbai, is an informal settlement whose workshops tan leather, make pottery and garments and recycle plastic, metal and paper; its recycling trade alone is estimated to employ about 250,000 people.

Governments may clear, license or support informal businesses. The informal sector is best seen as part of the urban economy rather than a separate one, since formal firms buy from informal workshops and informal workers serve formal workplaces.

Incidence at varying stages of development

Poverty, deprivation and informality exist in cities at every stage of development, but they differ in their scale, their form and their location within the city.

In HIC cities informality takes less visible forms. Colonias in Texas and New Mexico are rural subdivisions near the Mexican border where plots were sold without water, sewers or paved roads, and where many residents built their own homes. The suburbs (banlieues) of Paris contain large post-war social-housing estates with high unemployment; unrest that began in Clichy-sous-Bois in October 2005 spread to many French cities and drew attention to the concentration of deprivation, often among residents of North and West African origin, on the city’s edge.

The comparison shows scale at work. At the city scale, deprivation in Lagos and in Manchester is both concentrated in particular districts; at the national scale, the depth of absolute poverty in Lagos is of a different order; and at the global scale, the growth of informal settlements depends on rates of urban growth that are fastest in sub-Saharan Africa and South Asia.

Case study: Lagos, a megacity on a lagoon

Site, situation and growth

Lagos is the largest city in Nigeria, a lower-middle-income country, and one of the largest in Africa. Its site is a set of low islands, sand spits and creeks at the south-western mouth of Lagos Lagoon, where barrier islands separate the lagoon from the Atlantic Ocean. The original settlement on Lagos Island was easy to defend and controlled the only deep channel from the lagoon to the sea. Its situation, at the point where the lagoon system meets the ocean on the coast of West Africa, made it the main port of the British colony of Nigeria from the 19th century, and the country’s capital at independence in 1960.

Growth has been extremely rapid. The urban agglomeration had about 325,000 people in 1950, passed 10 million around 2010 and reached about 13.9 million in 2019, a 43-fold increase in seventy years. Growth came from rural–urban migration and increasingly from natural increase within the city’s young population. The exact size of Lagos is disputed: the 2006 national census counted 8.05 million people in metropolitan Lagos, while the Lagos State government’s own count claimed 17.6 million for the state.

Functions and the shift of government to Abuja

Lagos is a multi-functional city: Nigeria’s main commercial and financial centre and the largest consumer market in West Africa, with Balogun and Idumota among its largest wholesale markets. The Port of Lagos at Apapa handles more than half of the country’s maritime trade, and Ikeja is the capital of Lagos State and the site of the international airport.

Its national administrative function moved away. In 1976 the federal government decided to build a planned capital, Abuja, near the centre of the country, to relieve congestion in Lagos and give Nigeria a capital not identified with any one region; the seat of government moved there on 12 December 1991. Lagos, largely the product of spontaneous growth, kept growing because the port, commerce and industry stayed.

Economic activities and land values

The CBD is on Lagos Island, around the Marina and Broad Street, with high-rise offices, banks and the main markets.

Its eastern half, Ikoyi, was laid out in the colonial period as a residential reservation for European officials and is now one of the most expensive districts in Africa. Victoria Island, to the south, has become a second CBD of corporate offices, embassies, hotels and luxury apartments, and the elite zone extends east along the Lekki peninsula, with new estates, malls and the Lekki Free Trade Zone, where the Dangote oil refinery has been built.

Reclamation has pushed the most valuable land onto the water. Banana Island, an artificial island of about 1.63 km² off Ikoyi, is divided into 536 plots for high-end homes. Eko Atlantic is a new district of about 9 km² being built by a private developer on sand pumped from the sea in front of Bar Beach, protected by a sea wall about 8 km long.

Eko Atlantic is planned for at least 250,000 residents and 150,000 daily commuters, and plots in its first phases cost from about US$1,150 per m². Residents of neighbouring coastal districts blame the works for worse erosion and surges, including an August 2012 surge that swept people into the sea at Kuramo Beach.

Most industry is on the mainland: the port and its warehouses and factories at Apapa, industrial estates around Ikeja, and newer manufacturing on cheaper land on the city’s northern and western edges. Most of the population lives there too, in dense neighbourhoods where markets and workshops are mixed with homes.

Informal housing and work

Lagos contains many informal settlements, and informal work in trade, transport and services employs a large share of its workers. Makoko, on the mainland shore of the lagoon next to the Third Mainland Bridge, is one of the best known. About a third of it is built on stilts over the water; most residents of its waterfront are Egun fishing families whose ancestors came from Badagry and the Republic of Benin. Estimates of its population range from about 85,000 to over a million, a sign of how poorly informal settlements are counted.

Settlements such as Makoko occupy land of little formal value close to the centre and its jobs, and their position is insecure. In July 2012 the Lagos State government ordered stilt houses in Makoko demolished on safety and environmental grounds, giving 72 hours’ notice, and nearly 3,000 people lost their homes; further demolitions followed in later years, most recently in January 2026. Residents and human rights groups describe such evictions as unlawful and note that cleared waterfronts are often sand-filled and sold for high-value development.

The share of Nigeria’s urban population living in slums fell from about 74% in 2000 to about 48% in 2022, in modelled estimates.

How well do the models fit Lagos?

No single model describes Lagos. Its structure is best explained by its site, which divides the city between valuable islands and a mainland, by its colonial history, which placed the elite and the CBD on Lagos Island, and by land values that now drive reclamation for the wealthy while the poor occupy unwanted land on the water’s edge.

What Lagos shows about the key concepts

Sources: UN DESA, World Urbanization Prospects, and National Population Commission of Nigeria (2006 census), via Wikipedia, “Lagos”, “Makoko”, “Eko Atlantic” and “Banana Island”, 2026; UN-Habitat via World Bank WDI, 2026.

• Explain why the highest land values in Lagos are found on its islands rather than at a single central point.

• To what extent does the Hoyt sector model explain the location of the elite residential districts of Lagos?

• Discuss whose interests are served by the reclamation of land at Eko Atlantic and by the clearance of waterfront settlements such as Makoko.

Exam practice

In Paper 1 each option has a structured question on a stimulus (10 marks) and a choice of extended-response questions (10 marks).

Examiners reward detailed, located evidence above all.

Structured question

The stimulus is the line graph of the population of the Lagos urban agglomeration, 1950–2019, shown in the case study.

Extended response

Summary

• Countries define “urban” differently, by population, density, status or employment; the UN’s Degree of Urbanisation gives a common grid-based method.

• The site is the land a settlement is built on; its situation is its location relative to routes, resources and other settlements.

• Settlements form a hierarchy from hamlet to million city, megacity (10 million+) and metacity (20 million+); global cities lead by influence, not size.

• Central place theory explains the spacing of centres through range and threshold; the rank-size rule and primacy ratio test a country’s urban system (Lima is 9.5 times Arequipa).

• Bid-rent theory explains the concentric fall of land values from the CBD, but planning, accessibility, physical factors and history modify it.

• Retail, offices and industry have decentralised to retail parks, edge cities, business parks, industrial estates and science parks.

• The Burgess, Hoyt and multiple nuclei models describe HIC cities; Griffin and Ford and McGee describe Latin American and South-east Asian cities, where the poor often live at the edge.

• Residential patterns reflect physical factors, land values, ethnicity (segregation, measured by the index of dissimilarity) and planning.

• Poverty is a lack of income; deprivation a lack of access, measured by indices such as England’s IMD.

• About 1.12 billion people lived in slums in 2022 and about 61% of workers were informal in 2018; informality is greatest in LIC cities but takes other forms in HIC cities.

Self-check

• To do:

  I can define an urban area and explain why national definitions make comparisons difficult.

• To do:

  I can distinguish site from situation and describe urban functions and land uses with examples.

• To do:

  I can describe the settlement hierarchy, explain central place theory and determine a primacy ratio and rank-size predictions.

• To do:

  I can distinguish planned from spontaneous growth, using Brasília, Abuja and Lagos.

• To do:

  I can draw a bid-rent graph and explain the location of retail, offices and industry.

• To do:

  I can draw and evaluate the Burgess, Hoyt, multiple nuclei, Griffin and Ford, and McGee models.

• To do:

  I can explain how physical factors, land values, ethnicity and planning shape residential areas, and determine an index of dissimilarity.

• To do:

  I can distinguish poverty from deprivation and describe how an index of multiple deprivation is built.

• To do:

  I can examine informal housing and work in cities at different stages of development.

• To do:

  I can use Lagos to test urban models against a real city.