The first two of these points require some additional attention. Many authors have recognized that urbanization is a necessary but not a sufficient condition of economic development. Gugler suggests that the impetus for agglomeration, particularly in capital cities, is driven by the disproportionate share of both consumption and investment evident in these cities. According to Harris, national economic development is frequently led by urbanization and increases in productivity resulting from a concentrated labour force. In addition, urban activities can have important macroeconomic implications.
Manufacturing serves as a good illustration.
Manufacturing in developing countries is largely related to international specialization rather than domestic demand - establishing a strategic link between urban manufacturing and macroeconomic concerns such as trade policies, structural adjustment and debt. Other such urban sectors with a connection to macroeconomic decision-making include infrastructure, distribution systems, communications, finance, business, education and government. Then incomes, however meagre, are generated and provide a basis for improvement. Informal sectors of developing country economies generally offer great commercial potential - some account for 70 percent of all economic activity. In order to address urban poverty, serious primary consideration must be given to the operation and governance of this sector.