Paper short abstract:

Previous studies have overlooked actual interactions between economic actors residing in both urban and rural areas. This paper looks at the multidimensional interactions and dynamic networks of people and capital between small towns and rural areas in Zambia, based on empirical analysis.

Paper long abstract:

The role of small towns in regional development has been discussed in the general development framework; however, the actual interactions between economic actors residing in both urban and rural areas have been overlooked. This paper aims to shed light on this topic through empirical analysis of urbanization in Siavonga, a small town in Southern Zambia, and its impact on rural livelihoods. It is based on long-term fieldwork both in Siavonga and a rural village located 50km from the town. It was found that economic actors in Siavonga began to diversify, especially after 2000. Retired people from the formal sector, entrepreneurs residing in other larger cities, foreign investors, and rural people came to start their own business for different reasons. These people increased job opportunities and triggered a population influx. Thus, the town functioned as an economic niche and/or alternative economic space for both urban and rural dwellers. Urbanization in Siavonga affected mobility patterns in the study village. Many villagers preferred to work in Siavonga because of proximity, low costs, and the comfort of social networks. The phenomenon also promoted the development of commercial activities, such as management of shops and bars. Importantly, the social network and mobility between rural villages and towns, including Siavonga, seem to be essential for sustaining and expanding these businesses. Results show that small towns could play a key role in rural transformation. Finally, this paper demonstrates the importance of understanding multidimensional interactions and dynamic networks of people and capital between small towns and rural areas.