The Impact of Industrialization on Urbanization in Russia

My work considers the causes of urbanization. Typically, this process is associated with industrialization – the production growth of industrial goods. However, over the past century, we can find a few cases when countries have become more populated without the increase in production of the industrial sector. This is due to the fact that the territory can become attractive due to the reserves of its natural resources. I reflect this model of relations to the Russian regions and create a model that shows two options for increasing the level of urbanization in regions. The first way shows how the labor shifts from agricultural production to industrial one – industrialization. And the second one occurs because the income from the natural resource export is spent on the purchase of other sectors’ goods. So, the main share of workers goes to the sector of non-tradable good or service. Empirically, I show that such a shift in labor is really present in the Russian regions. However, in some regions, which are rich in natural resources, the share of workers in agricultural production is still high. This fact gives me a reason to assume that the process of urbanization is quite long-term and the natural resource effect has not yet been fully appeared in some regions.