Redefining the Cycle of Underdevelopment of Small Iranian Cities (A Grounded Theory approach)

Introduction: 
Globally, urbanization trends forecast that by 2050 nearly 68% of the world population will live in urban areas, intensifying pressures on cities and heightening the vulnerability of smaller urban systems (Sharma et al., 2025). Simultaneously, small cities play a critical role in regional balance by absorbing rural migration, preserving local culture, and enabling sustainable development patterns. Despite their importance, small cities struggle with endogenous and exogenous barriers, including weak governance, poor infrastructure, shrinking financial resources, and the adverse impacts of climate change such as drought, water scarcity, and environmental degradation (Diaz et al., 2024; Sassenou et al., 2024). Small Iranian cities face complex development challenges that have received limited scholarly attention compared to larger urban centers. These challenges necessitate a grounded, evidence-based exploration of their development dynamics to inform appropriate interventions. This study aims to redefine the underdevelopment cycle of small cities in Iran through a qualitative grounded theory approach, yielding insights into the structural conditions, causal factors, consequences, and strategic solutions relevant to these urban contexts.
Methodology: This research employs a qualitative methodology based on grounded theory to develop a context-sensitive conceptual model. Data were collected through semi-structured interviews with 16 regional planning specialists who hold extensive academic and professional experience. The experts' backgrounds span academia, municipal administration, urban planning, and regional development, ensuring a broad perspective on small city challenges. Interviews explored themes including economic structure, governance, infrastructure, social dynamics, environmental conditions, and development strategies.
The collected data were rigorously analyzed using MAXQDA software through an iterative three-level coding process: open coding to identify initial concepts, axial coding to relate categories and subcategories, and selective coding to refine core themes and theoretical constructs. This systematic approach enabled the emergence of a grounded theoretical framework that depicts the underdevelopment cycle holistically, capturing the nuanced interplay among environmental, economic, institutional, and socio-cultural factors.
Results: The findings reveal a complex, multidimensional underdevelopment cycle centered on economic vulnerability, environmental degradation, governance weaknesses, and socio-cultural declines.

Economic Vulnerabilities: Most small cities show a deep reliance on mono-product agricultural economies, predominantly traditional and low-technology farming, which limits economic diversification. Agricultural productivity is severely affected by climatic factors such as drought, irregular rainfall, and water scarcity, as well as by structural issues like land fragmentation resulting from inheritance practices. These challenges reduce income stability, drive outmigration, increase dependence on imports, and limit reinvestment in local economies. The scarcity of alternative economic opportunities, such as industrial or service sector activities, heightens the economic fragility.
Environmental Challenges: Environmental degradation, including soil erosion, pollution, depletion of water resources, and habitat loss, emerges as a major developmental bottleneck. Traditional agricultural techniques exacerbate ecological pressures, while climate change impacts intensify environmental stresses on already vulnerable ecosystems. This environmental fragility diminishes the natural resource base, critical for sustainable agricultural production and human settlement.
Governance Deficiencies: A pervasive lack of specialized urban planning and managerial capacity limits municipalities’ ability to strategically plan and manage development. Municipalities suffer from unstable and inadequate financial resources, leading to dependency on unsustainable and irregular income streams. Centralized governance models prioritize larger cities, often diverting investment and policy attention away from small towns. Infrastructure (particularly public utilities, transportation, healthcare, and digital connectivity) remains underdeveloped and poorly maintained, restricting quality of life improvements and economic dynamism.
Socio-Demographic Shifts: Youth outmigration towards larger urban centers is driven by lack of employment, education, and social opportunities. The rising proportion of the elderly population along with shrinking birth rates contributes to workforce shortages. Demographic decline diminishes social networks, weakens community participation, and undermines cultural continuity. The loss of young and skilled populations aggravates economic decline and slows innovation.

Discussion: Consequences of the Underdevelopment Cycle can be explained as the interlocking effects result in population shrinkage, exacerbating the contraction of demand for goods, services, and social infrastructure. Economic collapse is evident in declining entrepreneurial activities, loss of investment, and persistence of low-value traditional agriculture. Cultural erosion leads to the fading of local identities, traditions, and social capital, impacting social cohesion. Environmental degradation continues unchecked, reducing resilience and further undermining the city’s ecological and economic foundations. The findings collectively illustrate a self-reinforcing cycle of underdevelopment where economic, social, governance, and environmental challenges mutually reinforce one another, making it difficult for small cities to escape this downward spiral.
Conclusion: This study offers a rigorously grounded conceptual model capturing the cyclical nature of underdevelopment in small Iranian cities. By highlighting the multi-causal roots and proposing multi-sectoral strategies, it provides a roadmap for policymakers, planners, and stakeholders to foster sustainable transformation. Addressing these challenges will require coordinated multi-level governance, long-term commitment, capacity enhancement, and the harnessing of technological and cultural potentials within these small yet significant urban centers.