In 1966, industry was located mostly in Old Taipei where the districts of Tatong, Lungshan, Yengping and Shuangyuan contained 44.7% of all factories. Overall, the Old City locations had benefits (access to rail and road transportation along with availability of water, markets, and employees) which allowed them to retain their advantage and their large manufacturing base even though there were some shifts to new neighborhoods as a result of cheaper land. For example, industries which were a public nuisance owing to pollution — or which required large amounts of space — located in the new districts of Shihlin and Nankang. Sungshan and Tatong, though, had both the most diverse mixture of factories and the greatest number of companies in each type of manufacturing.
As with most older cities in China, there was not a complete separation of urban function, nor was there a separation of work and residence. Instead, like many cities in Asia, Taipei boasted an architectural form known as the shophouse.
Shophouses can be found throughout Asia, wherever there are Chinese shopkeepers. In Taipei, the main concentration was found along Chungshan North Road and in the area north and east of the central railroad station. During the 1970s, this core was displaced by the development of new, more westernized shopping centers. Still, more space remained devoted to residences in downtown commercial areas of Taipei than western planners were comfortable with at the time. Because whole city blocks were usually not available for development, the city ended up with a combination of large, modern structures along a main street with a small enclave of traditional buildings squeezed between them.
The shophouse structure was set back from the street with some sort of work area on the ground floor and living quarters for the family in back. In some instances, the living quarters were above the work area, extending out over the sidewalk. Consequently, during the 1960s and 1970s, more traditional, informal economic and social services were found on almost every street corner in the city. Even with the advent of the multinational firm, most industry in Taipei remained small scale, and SMEs were solidly integrated into the urban fabric of the capital. Cheap public transportation and the absence of privately owned vehicles precluded the development of car oriented centers in the older areas of Taipei.
While influenced by the US in so many different aspects, concepts of western planning had little impact on Taipei’s industrial core.
The chief commonality between US cities and Taipei during the Cold War period seems to be the decline of population in the urban core and the growth of peripheral areas, leading to boundary expansion.
On the other hand, unlike American cities, wherever one traveled in the capital during the labor intensive period one encountered the military aspects of everyday life. According to Roger Mark Selya
. . . the Chinese militry permeated all of Taipei life. There were jeeps and military trucks on every road. Soldiers were everywhere. Some of them “guarded” buildings or important intersections. Many soldiers of all ranks just seemed to be doing daily, personal, household chores. Middle and high school students also looked like soldiers since their uniforms were the same style and color as the military. One newspaper cartoon had a middle school child sitting beside a general on a bus asking which high school the general attended. Security concerns also permeated civilian and business offices . . .
Militarism rather than Western concepts of urban design dictated the character of urban life. However, even though Cold War fears and opportunities had changed the face of Taipei, there were also other anxieties, particularly related to uneasiness over illegal workers, the informal sector, and heightening rural-urban migration.
By 1966, up to 39% of all factories in Taipei City were illegal, usually concentrated in the Old City. Most unauthorized business were traditional, not associated with the new business partnerships with the US. Four types of industry comprised the majority (60%). The industries most highly represented were basic metals (24%). machinery (12%), printing (15%), and wood (9%).
At the same time, as in other urban areas of the less developed world, there was a large informal sector. However, in Taipei, workers in the less formal sector received relatively high salaries compared to workers with similar positions in other fast-growing Third World nations. Moreover, in contrast with the more common pattern worldwide, Taipei’s informal sector was not dominated by migrants. Instead, due to the rich mix of public and private transportation made possible by US supported infrastructure projects in Taiwan, many of Taipei’s informal workers were commuters.