The International Dimension of (European) Urban Policy- a view from the OECD Ioannis Kaplanis Economist Regional Development Policy Division Public Governance and Territorial Development Directorate Open Days- 12 th European Week of Cities and Regions Brussels, 9 October 2014
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Presentation on the inter Open Days, Brussels, Belgium 6-9 October 2014, presentation on the international dimension of European urban policy by Ioannis Kaplanis, Economist (Urban Programme) Regional Development Policy Division
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The International Dimension of (European) Urban Policy- a view from the OECD
Ioannis Kaplanis Economist Regional Development Policy Division Public Governance and Territorial Development Directorate
Open Days- 12th European Week of Cities and Regions Brussels, 9 October 2014
Topics
1| Urbanisation trends 2| A new urban paradigm- European and international 3| Governance arrangements matter 4| Collaboration at the international level
3
Most people across the OECD live in cities
13.4%
25.3%
27.3%
28.0%
28.7%
29.3%
29.8%
30.2%
35.3%
36.0%
36.8%
37.2%
37.4%
37.9%
38.8%
39.3%
39.6%
40.0%
40.4%
40.8%
44.4%
47.0%
48.3%
48.6%
50.9%
53.5%
56.3%
68.5%
73.2%
83.1%
24.3%
22.2%
25.1%
11.9%
21.7%
17.9%
25.0%
20.3%
20.9%
18.8%
32.3%
36.9%
15.9%
17.9%
25.0%
16.1%
15.8%
9.1%
25.0%
33.3%
14.7%
10.8%
24.9%
18.3%
11.0%
15.0%
16.8%
9.5%
13.4%
16.9%
62.4%
52.5%
47.6%
60.1%
49.5%
52.9%
45.2%
49.5%
43.8%
45.3%
30.9%
26.0%
46.7%
44.3%
36.3%
44.5%
44.5%
50.9%
34.7%
25.9%
40.9%
42.2%
26.8%
33.1%
38.0%
31.5%
26.9%
21.9%
13.4%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Luxembourg (1)
Slovak Republic (8)
Norway (6)
Finland (7)
Slovenia (2)
Hungary (10)
Czech Republic (16)
Poland (58)
Italy (74)
Switzerland (10)
Denmark (4)
Spain (76)
Netherlands (35)
Sweden (12)
Ireland (5)
Germany (109)
Portugal (13)
Estonia (3)
Greece (9)
France (83)
United Kingdom (101)
Belgium (11)
Austria (6)
Chile (26)
OECD (1179)
Mexico (77)
United States (262)
Canada (34)
Japan (76)
Korea (45)
Metropolitan Areas (500,000+) Small/Medium Sized Functional Urban Areas (50,000-500,000) Residents living outside Functional Urban Areas
Source: http://geography.about.com/library/weekly/aa011201a.htm, citing Chandler, T. (1987) Four Thousand Years of Urban
Growth: An Historical Census, Edwin Mellen Press.
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1950-1970 1971-1990 1991-2010 2011-2030 2031-2050
Developed countries
Developing & emergingcountries in Asia
Developing & emergingcountries in other regions
5
Urban population is growing at the fastest
speed in developing and emerging countries
Source: UNDESA Population Division (2012), World Urbanization Prospects: The 2011 Revision
New urban dwellers in absolute numbers (1950-2050)
Bil
lio
ns
6
7
Income growth comes with urbanisation; however
urbanisation doesn’t guarantee it
Urbanisation rate (%)
Income
growth
40-50%
Country Group A (urbanisation hand-
in-hand with income growth)
Country Group B (intermediate)
Country Group C (urbanisation doesn’t bring
income growth)
The traditional paradigm:
• Efficiency and growth come first.
• Pursuit of equity or environmental goals should interfere as little as possible with the pursuit of growth.
• Regional policy as the ‘residual sectoral policy’.
A new approach:
• Giving greater weight to complementarities (not just tensions) between efficiency, equity and environmental objectives.
• Complementarities between these three dimensions of progress are most visible and most effectively managed in particular places.
• Not one size fits all- but place based policies
• Urban/regional policy is not simply another line of policy running in parallel to sectoral policies: it is about co-ordinating and optimising the mix of sectoral policies where they interact – in specific places. 8
Reconciling efficiency, equity and environmental sustainability
9
Sustainability must be pursued in all
its three dimensions
Identifying and promoting links between economic, environmental and social goals is both possible and critical to building cities/regions that work
Efficiency Equity Environmental
sustainability
Economic policies
Sustained growth
Economic reforms may increase equity
Green growth policies can improve
sustainability
Social policies
Social cohesion can increase efficiency
(e.g., trust, security, knowledge)
Social cohesion
Inequality can be reduced without
environmental harm (e.g., replace fuel
subsidies with transfers)
Environmental policies
Green growth policies can boost
innovation and efficient resource use
Environmentaldegradation tends to
hit disadvantaged groups more
Environmentalsustainability
Sustainable development requires a search for policy complementarities
Role of Subnational Governments by types of expenditures
26%
18%
14% 14% 12%
16%
20%
13% 12%
16%
20% 18%
0%
5%
10%
15%
20%
25%
30%
Education Health EconomicAffairs
GeneralServices
Socialprotection
Other*
OECD (27 countries) EU27
OECD and EU (2011, % of expenditure)
*Other: Defence; Public order and safety; Housing and community amenities; Recreation, culture and religion; Environment.
Urban/regional policy should focus more on coordination failures
& Governance
11
• Recent OECD analyses suggest that governance fragmentation can more than offset the economic benefits of agglomeration.
• Local and regional policies can do more to reduce agglomeration costs (congestion, pollution, etc) than to enhance agglomeration benefits.
• Findings on polycentrism point to the potential benefits of systems of cities: connectivity matters.
• Agglomeration is not a synonym for density.
12
Agglomeration and governance
13
Agglomeration benefits are real
Productivity increases with city size.
Source: OECD Metropolitan Database.
14
Agglomeration in support of
territorial cohesion?
Economic growth increases with proximity to large cities Yearly growth rates of GDP per capita in TL3 regions (1995-2010) and driving time to the closest large
metropolitan area of 2m or more inhabitants
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
within 45 min.by car
45 to 90 min.by car
90 to 180 min.by car
180 to 300 min.by car
more than 300min. by car
Note: Yearly growth rates controlling for country fixed effects and initial GDP. Eighteen OECD countries included.
Source: Ahrend, R and A. Schumann (OECD, 2014)
15
Less fragmented urban governance promotes growth
• Urban sprawl creates negative externalities in Metropolitan areas (MAs)
• Cooperation is a way to internalize the externalities when making policy decisions
Governance bodies reduce the cost of administrative fragmentation
Difference significant at the 99%-level after controlling for log-population levels and country specific trends.
-0.8
-0.6
-0.4
-0.2
0
0.2
0.4
0.6
0.8
1
1.2
1.4
With GovernanceBody
Without GovernanceBody
Change in Urban Sprawl
Based on OECD Metro Governance Survey
Governance bodies increase well-being
55%
60%
65%
70%
75%
80%
With TransportAuthorities
Without TransportAuthorities
Share of Citizens Satisfied with Public Transport • Public Transport
projects usually cut through many jurisdictions
• Cooperation is required for effective implementation and coordination of services
• Citizens are more satisfied in MAs that have sectoral authorities for public transport
Based on European Urban Audit perception survey. Difference significant at 95% level.
• Invest using an integrated strategy tailored to different places
• Adopt effective co-ordination instruments across levels of govt
• Co-ordinate across SNGs to invest at the relevant scale
Pillar 1
Co-ordinate across levels of governments
and policies
• Assess upfront long term impacts and risks
• Encourage stakeholder involvement throughout investment cycle
• Mobilise private actors and financing institutions to diversify sources of funding and strengthen capacities
• Reinforce the expertise of public officials & institutions
• Focus on results and promote learning from experience
Pillar 2
Strengthen capacities and promote policy
learning at all levels of government
• Develop a fiscal framework adapted to the objectives pursued
• Require sound and transparent financial management at all levels
• Promote transparency and strategic use of procurement
• Strive for quality and consistency in regulatory systems across levels of government
Pillar 3
Ensure proper framework conditions for public
investment at all levels of government
18
An OECD instrument: The Principles for Effective Public Investment Across Levels of Government
- The first OECD Instrument in the area of regional policy and where sub-national governments are explicitly recognised
• OECD “Urban trends and governance” project financed by DG Regio (agglomeration, governance, connectivity, etc)
• FUAs: new definition of cities by OECD and EU based on functional economic criteria than administrative boundaries
• Collaboration of OECD with Eurostat on Regional & Metropolitan Area Databases
• Support by EU for OECD research on international experiences of urbanisation (e.g. National Urban Policy Review of China)
• Convergence of views between the CoR and the OECD on multi-level governance approaches and further collaboration on implementation
19
Collaboration of OECD and EU institutions
on urban policy
20
The OECD Metropolitan Database
Interactive maps and data: For metro areas: http://measuringurban.oecd.org/ For regions: http://stats.oecd.org/OECDregionalstatistics/