| Summary: | This thesis analyses the impact of trade openness on urbanization in eastern China during the period of 1987 to 2005. The theoretical framework shows that open trade has a positive impact on growth of urban population, because trade serve as a factor that creates great job opportunities. According to the descriptive data, the massive rural-urban migrations are mostly concentrated in the eastern coastline of China where trade was started. Previous studies concluded that there is a positive relationship between trade openness and urbani-zation.Our study is based on a set of panel data from the period of 1987 to 2005 within 6 coast-line provinces. After running 4 different regressions we found that, 3 of the regression models revealed positive and statistically significant at 1% results, which suggest that the impact of trade openness on urbanization is positive.
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