1. Sectorial background of urban–rural economic development inequalities
dr. Jeney László
Senior lecturer
Economic Foundations of Local Development
Module 1/b: Urban and Rural development by sectors
Autumn term 2016/2017.
CUB Department of Economic Geography and Futures Studies

2. Shifting of the economic Core2 2

3. Geographical concentration of the economy still remained in the Core
Economic development:
GDP per capita
Economic density:
area GDP per area 3 3

4. The European Pentagon Pentagon/Core
Area: 20%
Population: 40%
GDP: 50%
Cities over 500 thousand residents:
population: 20%
GDP: 29%
GDP/cap.: 141%
GDP-growth: faster with +8%-point 4 4

5. Economic Importance of Cities in North America
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
Proportion of cities in Canada/USA
country
population
GDP
USA (SMA)
38%
49%
Canada (CMA)
45%
54% 5 5

6. Key Factors of Urban Competitiveness in European Space Structure6

7. The subject of research, basic assumptions
New factors affecting the regional processes of East Central Europe at the turn of the millennium
Transition (the end of the bipolar world system)
Integration (accession to the European Union)
Globalization
Dynamic take-off, but cities and rural regions get different developmental impulses
Dual effects on economic pattern of V4 Countries (trade-off theories)
Convergence in pan-European relation (catching-up)
Divergence in urban–rural relation

8. Territorial frame East Central Europe V4 Countries
Broader
Cultural, historical relationships
V4 Countries
Narrower
Current political states (CZ, HU, PL, SK)
Regional level: NUTS3

9. Definition of the Concept of Urban and Rural Regions
Urban regions = cities
Population >500 thousand + Bratislava
Without suburbs
Regions at NUTS3 level (Bratislava  Bratislavský County)
Rural regions = complementary regions
≠ Villages
≠ Regions with rural characters (e. g. sparse population, importance of agriculture)

10. Database used 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

11. Cities as positive residuums of the East Central European space structure
population 2004 (million)
GDP 2004 (billion €)
per capita GDP 2013 (€ per capita)
GDP growth 1995–2013 (%) V4
Total 64
407
6377
206
Cities 8
106
13368
237
Relative state of cities
12%
26%
210%
+31%-point EU
20%
29%
141%
+8%-point

12. Differences of Urban–Rural Duality in Member States of EU, 2013
Measuring Urban–Rural Duality
DUR: urban–rural duality index
xU: average per capita GDP of cities in a country
xR: average per capita GDP of rural regions in a country
Source of data: Eurostat

13. Relationship Between State of Development and Urban–Rural Duality for EU Members, 2004
Source of data: EuroStat 13 13

14. Post-socialist countries: characterized with growing urban–rural dualism
Source of data: EuroStat
Chiefly the outstanding of capitals
More remarkable in case of underdeveloped, catching-up V4 countries than older members
Change of Urban–Rural Duality in EU Member States, 1995–2013 14 14

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

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

17. Role of urban–rural inequality in overall regional inequalities
Measuring overall economic inequalities at level of NUTS3 regions (H. Hoover index):
n: number of regions at NUTS3 level (n = 87 for Visegrad Countries)
xi: share of “i” region of the total GDP of the country
fi: share of “i” region of the total population of the country
Measuring urban–rural inequalities (Hur: Hoover index same formula)
n = 2 (aggregate of 8 cities and aggregate of 79 rural NUTS3 regions)
Role of urban–rural inequality with the overall regional inequalities (Rur):

18. Degree of urban–rural inequality in proportion to the overall regional inequalities in EU, 2013
Source of data: EuroStat

19. Role of urban–rural inequality in overall regional inequalities of EU member states, 2013
Rur: role of Hur in overall regional inequalities (H)
Hur: urban–rural inequality
Source of data: EuroStat

20. Groups of EU members according to the inequality at urban–rural and NUTS3 regional level, 2013
Hur. urban–rural inequality (10%)
H. overall regional inequality at NUTS3 level (10%)
Rur. role of urban–rural inequality in overall regional inequalities (70%)
Types of countries
High
BG. CZ. F. GR. LV. LT. H. P. PL. SK
Low
A. B. GB. D. I. RO
SF. S
DK. NL. E
Source of data: EuroStat

21. Role of urban–rural inequality in overall regional inequalities of V4 member states, Hoover index 2013
Source of data: EuroStat

22. Post-socialist cities are to join to the 2nd level of European city-network
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
Sunbelt or (Golden Banana)
Central European Boomerang
Post-socialist cities: new development wave (similar to Southern Periphery) based chiefly on international investments 22 22

23. BUT: weak position of V4 cities in the European Urban hierarchy
Worse position of V4:
V4 countries: 508 company from the 15 thousand largest company of EU
Air traffic
Relative better position of V4
International meetings (better position) 23 23

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

25. The sectoral background of the urban–rural development inequalities

26. 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
Agriculture
Industry
Services
Cities 1995–2013.
1.3
1.8
2.6
Rural regions 1995–2013.
1.9
2.1
Growth Indexes of Gross Value Added (GVA) in the Sectors in V4 Countries, 1995–2013. 26 26

27. Growth of GDP and GVA by Sectors for Cities and Rural Regions
Agriculture
Industry
Services
Czech rural regions
2.0
1.4
2.1
Hungarian rural regions
2.3
1.7
2.5
Polish rural regions
1.8
1.2
Slovakian rural regions
2.2
1.6
2.4
Prague
1.9
2.6
Budapest
1.1
Polish cities
1.5
Bratislava
Total GDP
1.3 27

28. Regional and Sectoral Shifts within Industry after Transition (1992–1998): The Case of Hungary28

29. Regional Shifts in Hungarian Industry. 1992–1998.
Employment:
BUDAPEST (%) 29 22
Industrial output
23 524
33 316 36 24
Industrial export
5 449
16 371
FEJÉR county (%) 7 38 17 29

30. Sectoral Shifts in Hungarian Industry. 1992–1998.
Industries
1992
1998
Employment
Machinery and equipment (%) 21 25
Textile. wearing apparel. leather products (%) 15 17
Food. beverages and tobacco products (%) 18 16
Output 13 36 23
Chemical industry (%) 19
Electricity. gas. steam and water supply (%) 20 12
Export 27 61 8 30

31. Changes in Regional Industrial Specialization in Hungary. 1992–1998
Changes in Regional Industrial Specialization in Hungary. 1992–1998. Hirschman–Herfindahl index
1992
1998
employment
output
export 31 31

32. Regional Differences of the Economic Development Level in Hungary, 1998. (NUTS3)32 32

33. Conclusions
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
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 33 33