Tue Aug 3, 6:12 AM ET

GUSHI, China (Reuters) – China has put big money down on a momentous gamble: rush to build new cities in its poor interior, then wait for people to come and help drive the economy to a new stage of growth.

Here in this corner of the Chinese hinterland, the government has widened farm lanes into highways, turned wheat fields into an industrial park, spent a fortune on government offices, and set up a school for thousands of students in what was a dusty town a few years before.

Old, cracked gravestones have been bulldozed to make way for a housing estate featuring 60 apartment buildings, a winding creek and tennis courts, the latest such development in Gushi.

But the roads are mostly deserted apart from the odd goat herd trundling along them. The industrial park features a handful of workshops and no big factories. Vast new housing estates fan out from the original town center, most of them uninhabited. Skeletons of half-built villas, stained from neglect, are splayed across fields.

About 1,000 km (600 miles) south of Beijing in Henan province, Gushi is a microcosm of this latest face of China's urbanization, featuring ambitious officials, angry farmers, countryside capitalists, a new batch of consumers -- and empty buildings.

Over the past three decades, rural migrants flocked to big, prosperous cities along the coast. Now, in its revamped model of urbanization, the government is trying to bring cities to its farmers, a project that could absorb more residents than the entire population of the United States in the coming decades.

Farmers such as Xiang Wenjiang are not at all sure they like what they see rising up from their muddy fields.

"This is my land, but now it's all been sold," said the wiry, sun-beaten Xiang, eyeing a row of apartments under construction advancing toward his hut. "I won't leave until they give us the right money for moving, not just a few coins."

The apartment complex encroaching on Xiang's land is part of a vast urban development juggernaut that has become a new engine of economic growth as global demand sputters. It offers enormous opportunities for the companies that dig up the raw materials needed to build the new cities; that make the cars for the new roads and the washing machines for the new homes.

But such high hopes come with ample scope for disappointment. If the unprecedented population shift from villages to cities is mismanaged, it could squander resources, radicalize peasants and damage China's prospects.