Integrated urban and rural development is the solution to the disconnected development of urban and rural areas.

In this regard, the small towns that have emerged in recent years on the outskirts of big cities could help promote integrated unban-rural development and tap the potential of the countryside.

Small towns are a new form of economic and social organization that first emerged in Zhejiang province in East China in 2015 to promote industrial transformation and upgrading and a new type of urbanization.

Different from administrative towns and industrial parks, small towns are innovative entrepreneurship platforms integrating characteristic industries, production, living and ecological spaces on several square kilometers of land. In essence, they are fundamental spatial units with clear and unique industrial and cultural positioning, a pleasant living environment and integrated urban functions.

Unlike industrial parks or technology parks that have a single function, these small towns play the role of innovation platforms for both production and living. With geographical convenience, they are able to break the bottleneck in the integrated development of urban and rural areas, and facilitate the free flow of resources and production factors.

Unlike the developed countries, China has experienced a highly condensed urbanization process in the past decades. All kinds of development factors and resources have flown to cities, resulting in urban sicknesses. And the nutrition for rural growth has continuously flown to the cities, resulting in huge gap between urban and rural development. To integrate urban and rural development, it is necessary to break the current one-way flow of resources and establish a mechanism that benefits both urban and rural areas.

Rural areas have witnessed a serious shortage of infrastructure and public services which are the foundation for development. And larger cities, although possessing better concentrations of industries and higher quality populations, have experienced serious urban sicknesses. Since the flow of development factors cannot be changed, urban function decentralization is the only way to solve these sicknesses. However, under the existing framework for land use, there is no appropriate carrier or space to decentralize urban functions.

The innovative small towns first appeared in Zhejiang province just several years ago. They acted as the carrier for innovation and startups by gathering development factors and resources and have become a new engine for economic and social development.

Covering a few square kilometers, these small towns gather industries and integrate production, living and ecological spaces, with complete infrastructure, amenities and public services. They are mini cities - the smallest cities with complete urban functions. Therefore, it is relatively easy to construct such towns in any place.

The integration of production, living and ecological spaces is an important feature of the emerging small towns. A city like this will not have urban sicknesses. Therefore, for urban and suburban areas, the small towns work as an effective prescription and remedy for urban sicknesses and they can realize the decentralization of urban function. For rural areas, the small towns boost the local neighborhood economy through investment in construction, creating employment and demand for rural products. Also, the construction of small towns pushes forward reform of the rural land system, collective assets and rural economic organization, and optimizes the rural management system to realize the revitalization of rural areas.

To further promote the development of innovative small towns, it is necessary to strengthen their classification and layout. They can be built according to the features of their localities. The balance of development needs to be considered so they are not only put in the suburbs with good conditions, but in the dilapidated areas between urban and rural areas to inject vigor into the rural economy.

Of course, the completion and improvement of the functions of these towns should be put high on the government agenda to ensure a better environment for their development.

What's more, the government should increase policy support for the construction of innovative small towns, in particular, guarantee the use of land, capital and talents. To ensure enough land for construction, flexible policies should be adopted such as making good use of idle land and increasing the supply of special-purpose land. In terms of capital, equal importance should be placed on both making good use of current capital and increasing the budget.

Also, financial leverage and new channels of funds can also be explored. To attract more talents, governments should provide preferential tax policies, residential registration priority and other incentive policies, and meanwhile offer better public services.

Wang Boya is an assistant research fellow and Zhang Juwei is director and research fellow at the Institute of Population and Labor Economics at the Chinese Academy of Social Sciences.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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