Sustainable Development in Urban Areas: Contributions from Generalized Trade

Abstract

As the world continues to urbanize, sustainable urbanization is key to successful development. Urumqi has been suffering from acute water scarcity and serious pollution for several decades. Previous studies indicated that it would be “un-sustainable”, however, its population and economy sizes have continued to grow in the past 30 years. This phenomenon is interesting to many scholars and officials. This paper puts forward a new term “Generalized Trade” to investigate this phenomenon, which consists of physical and virtual trades. Physical trade refers to the transfer of commodities in monetary or physical form, and virtual trade refers to the transfer of resources or emissions embodied in commodities. This paper develops an extended noncompetitive input-output framework to investigate generalized trade of the Urumqi city. Results indicated that generalized trade in monetary form was balanced as a whole; while it was unbalanced more obviously in virtual-water, -energy, -employment, -exhaust, and -wasted-water forms, with entropy indicators 48.9, -6.16, 21.9, 44.8, and 23.6, respectively. Generalized trade in each form works in its peculiar way; yet they together contribute to sustainable development in Urumqi. Generalized trade offers a valuable answer to the phenomenon that Urumqi has been experiencing a fast development when facing “un-sustainable” challenges. Generalized trade implies that commodities are exchanged not only for money but also for water, energy, employees and others, to promote sustainable development in a region. It is suggested that multi-perspective and integrated policies are essential to maximize generalized trade benefits and avoid unexpected losses.