You can tell from the map that it has something to do with the terrain. Japan and South Korea are mountainous, with few plains, so the limited plains have become large cities and urban agglomerations (Seoul, Tokyo, Osaka).

To put it bluntly, only plains are the most suitable for human survival. If one more condition is added, plains with ports/rivers are the most suitable for human production.

The United States is at the other extreme, with vast plains. China is in the middle, with large plains and mountains. Therefore, China's urbanization will not be as concentrated as Japan and South Korea, but will be more like the United States, slightly dispersed.

The reason for the shrinkage of small cities is the shrinking population, and the solution to the population is a return to tradition, which is incompatible with industrial society (women's liberation, small families, high housing prices).

Let it be, I believe that the population will rebound when it drops to a certain level.