Impacts of the enlargements on the European economic pattern Economic Geography I. International Business bachelor study programme (BA) Spring term 2015/2016. CUB Centre of Economic Geography and Futures Studies dr. Jeney László Senior lecturer

2 Insufficient economic dinamism of European Union GDP growth rate – –1950s, 1960s: economic miracles – –From 1970s: slower than USA, Japan + rather fluctuating – –After the turn of the new Millenium: GDP growth: 2,8% 1960s: Mass of guest workers – –From N Afr., TR, former YU, later from the other post-socialist countries too) – cultural and legal hampers of their integration Significant regional differences (per capita GDP, GDP growth) – –East accession countries: lagging economy  new challenges

3 Shifting of the economic Core

4 Geogrpahical concentration of the economy still remained in the Core Economic development: GDP per capita Economic density: GDP per area GDP per area

5 The European Pentagon Pentagon/Core –Area: 20% –Population: 40% –GDP: 50% Cities over residents: –population: 20% –GDP: 29% –GDP/cap.: 141% –GDP-growth: faster with +8%- point

6 Economic Importance of Cities in North America Economic development measured only with per capita GDP Economic development measured only with per capita GDP –At current market prices in € –Examined area: V4 Countries (CZ, HU, PL, SK) –Examined regional level: NUTS3 –Examined period: 1995–2004 Data source: Eurostat Data source: Eurostat Proportion of cities in Canada/USA countrypopulationGDP USA (SMA)38%49% Canada (CMA)45%54%

7 Differences of Urban–Rural Duality in Member States of EU, 2013 Measuring Urban– Rural Duality Measuring Urban– Rural Duality –D UR : urban–rural duality index –x U : average per capita GDP of cities in a country –x R : average per capita GDP of rural regions in a country Source of data: Eurostat

8 Relationship Between State of Development and Urban–Rural Duality for EU Members, 2013 Source of data: EuroStat

9 Post-socialist countries: characterized with growing urban–rural dualism Chiefly the outstanding of capitals Chiefly the outstanding of capitals More remarkable in case of underdeveloped, catching-up V4 countries than older members More remarkable in case of underdeveloped, catching-up V4 countries than older members Change of Urban–Rural Duality in EU Member States, 1995–2013 Source of data: EuroStat

10 Growing Importance of Cities in European Economic Pattern Most of the cities over average Most of the cities over average –Studying success of cities: key issue for current European regional trends and regional policy Some countries Some countries –Only the cities are over average (e. g. V4) –Other inequality factors are more important (Germany. Italy. Romania. Spain) Economic Development State of Cities and Rural Regions Related to their National Average

11 State of cities and rural regions as compared to the national averages of V4 member countries, 2013

12 Post-socialist cities are to join to the 2 nd level of European city- network Studying success of cities: key issue for current European regional trends and regional policy Studying success of cities: key issue for current European regional trends and regional policy New European models on Peripheries should adjust the classic urban zone of Blue Banana New European models on Peripheries should adjust the classic urban zone of Blue Banana –Sunbelt or (Golden Banana) –Central European Boomerang Post-socialist cities: new development wave (similar to Southern Periphery) based chiefly on international investments Post-socialist cities: new development wave (similar to Southern Periphery) based chiefly on international investments

13 BUT: weak position of V4 cities in the European Urban hierarchy Worse position of V4: Worse position of V4: –V4 countries: 508 company from the 15 thousand largest company of EU –Air traffic Relative better position of V4 Relative better position of V4 –International meetings (better position)

Cities and NUTS2 regions: gerrymandering for development Budapest, Warsaw Budapest, Warsaw –Suburban zone  lower common average –Initially: better position for EU-supports –Later: due to the urban development  no supports Prague Prague –Suburban zone: target area of EU supports

The sectoral background of the urban–rural development inequalities

16 V4: success of cities not independent of the shift of their sectoral structure V4: success of cities not independent of the shift of their sectoral structure V4: success of cities not independent of the shift of their sectoral structure –Increase of urban–rural inequality is mainly tertiary based –Industrial renewal hide in the background of fine differences among rural regions AgricultureIndustryServices Cities 1995– Rural regions 1995– Growth Indexes of Gross Value Added (GVA) in the Sectors in V4 Countries, 1995–2013.

Regional and Sectoral Shifts within Industry after Transition (1992–1998): The Case of Hungary

18 Regional Shifts in Hungarian Industry, 1992– Employment: BUDAPEST (%) 2922 Industrial output BUDAPEST (%) 3624 Industrial export FEJÉR county (%) 722 BUDAPEST (%) 3817

19 Sectoral Shifts in Hungarian Industry, 1992–1998. Industries Employment Machinery and equipment (%) 2125 Textile. wearing apparel. leather products (%) 1517 Food. beverages and tobacco products (%) 1816 Output Machinery and equipment (%) 1336 Food. beverages and tobacco products (%) 2317 Chemical industry (%) 1915 Electricity. gas. steam and water supply (%) 2012 Export Machinery and equipment (%) 2761 Chemical industry (%) 2512 Food. beverages and tobacco products (%) 188

20 Changes in Regional Industrial Specialization in Hungary, 1992– Hirschman–Herfindahl index employmentoutputexport

21 Regional Differences of the Economic Development Level in Hungary, (NUTS3)

22Conclusions 1. Postsocialist countries: characterized with growing urban–rural dualism –Chiefly the outstanding of capitals –More remarkable in case of underdeveloped, catching-up V4 countries than older members –Not only the urban–rural inequality increases, but its role is more and more appreciated in overall regional inequalities 2. V4: success of cities not independent of the shift of their sectoral structure –Increase of urban–rural inequality is mainly tertiary based –Industrial renewal hide in the background of fine differences among rural regions