In the past, under the traditional pursuits of urban expansion, the problem of "regional population decline", was often overlooked. Although Taiwan's total population has been increasing, nearly half of Taiwan’s 358 localities have been experiencing net emigration over the past 30 years. Indeed, 81 of 178 urban localities lost more than 10% of their inhabitants between 1980 and 2010. Given this, we defined localities with more than 20,000 inhabitants as urban localities to observe the reasons behind urban shrinkage in Taiwan. This article attempts to explore why some urban areas have developed better over time with population gradually increasing, while others’ populations have been shrinking. What are the key determinants of urban development?

The results show that regional population decline has accompanied urbanization over the past three decades in Taiwan is mainly related to "rural decline,” which is unlike most advanced countries that are experiencing "urban decline." Furthermore, regional variation analysis and space exploration analysis reveal that a total of 6 among 23 counties are shrinking, and that 60 localities present a "significant population decline" phenomenon in the LISA cluster map. Finally, the chi-square test demonstrates that socioeconomic factors like the growth rate of the aging population, the successful transformation of the industry, and the convenience of transportation are the mains factors impacting urban development. In addition, spatial regression analysis further reveals that the proximity effect also has a great influence on strengthening urban development.