The OECD regional typology
The OECD taxonomy defines TL3 regions as predominantly urban (hereafter referred to as urban), intermediate and predominantly rural (hereafter referred to as rural). This taxonomy, established in 1991, is designed for facilitating international comparability of rural data. With this aim, it applies the same criterion and selects comparable units among OECD member countries. The OECD scheme distinguishes between two levels of geography within countries: a local community level and a regional level. Local communities are defined as basic administrative units or small statistical areas (comunas in Chile). They are classified as either rural or urban using a population density threshold. In a second step, TL3 regions, which correspond to larger administrative units or functional areas, and reflect the wider context in which rural development takes place, are defined as predominantly urban, intermediate or rural with a criterion measuring the share of population living in rural communities (Box 1.1).
According to the OECD taxonomy, 40 of Chilean TL3 regions are defined as rural, followed by 7 as urban and 7 as intermediate (Table 1.1). According to this taxonomy, 34.6% of the Chilean population lived in rural regions, 50% in urban regions and the remaining 15% in intermediate regions in 2012.
Box 1.1. OECD regional typology
The OECD regional typology is part of a territorial scheme for collecting internationally comparable “rural” data. The OECD typology classifies TL3 regions as predominantly urban, predominantly rural and intermediate. This typology, based on the percentage of regional population living in rural or urban communities, allows for meaningful comparisons among regions of the same type and level. The OECD regional typology is based on three criteria. The first identifies rural communities (comunas in Chile) according to population density. A community is defined as rural if its population density is below 150 inhabitants per km2 (500 inhabitants for Japan to account for the fact that its national population exceeds 300 inhabitants per km2). The second criterion classifies regions according to the percentage of population living in rural communities. Thus, a TL3 region is classified as:
The third criterion is based on the size of the urban centres. Accordingly:
Table 1.1. Chilean provinces classified by the OECD typology
Notes: PR: predominantly rural; PU: predominantly urban; IN: intermediate. The classification of Antofagasta and Iquique as predominantly rural can be driven by the fact that the true urban core is much smaller than the administrative boundaries of the comunas in these regions resulting in population density below 150 km2.
Source: OECD (2013), OECD Regional Statistics (database), http://dx.doi.org/10.1787/region-data-en. (accessed on 15 December 2013).
Following this definition, Chile has both a relatively high proportion of its population living in urban regions and in rural regions, significantly higher than the OECD average. In contrast, it has one of the lowest shares of population living in intermediate regions, only surpassing Ireland, which does not have any TL3 regions defined as intermediate. The simultaneously high share of urban and rural regions reflects the high degree of concentration and vast geographic surface area of Chile. It is important to keep in mind that the OECD taxonomy classifies TL3 regions reflecting a larger geographic context in which rural development takes place. Contained in these wider areas is a mix of smaller urban and rural areas.
Figure 1.1. Share of population living by type of region classified by the OECD typology
The OECD taxonomy defining three types of regions was adopted by the European Commission (EC) in its early stages and by many OECD member countries, mainly as a useful tool for analysis and international comparability due to its simplicity. While many OECD member countries use the definition as a guiding principle, most continue to have, in parallel, their own definitions, defining urban and rural areas in a manner adapted to their own local contexts and specificities. These latter definitions are applied for policy and regulatory purposes.
The OECD taxonomy was refined in recent years to an OECD extended typology defining five types of TL3 regions: predominantly urban, intermediate close to a city, intermediate remote, rural close to a city and rural remote. The extended typology adds a distance criterion to urban centres and distinguishes between different types of intermediate and rural regions: those close to urban centres and remote ones. The main aim of the extended typology is to improve analytical results and international comparability.
Box 1.2. Extended OECD regional typology
To account for differences among rural and urban regions, the OECD established a regional typology, classifying TL3 regions as predominantly urban (PU), intermediate (IN) or predominantly rural (PR). This typology proved to be a meaningful approach to explaining regional differences in economic and labour market performance. However, it did not take into account the presence of “agglomeration forces” or additional impacts of neighbouring regions. In addition, remote rural regions typically face a different set of problems than rural regions close to a city, where a wider range of services and opportunities are commonly available.
The extended regional typology tries to discriminate between these forces and is based on a methodology proposed by the Directorate General for Regional Policy of the European Commission which refines the current typology by including a criterion on the accessibility to urban centres. This allows distinguishing between remote rural regions and rural regions close to a city in terms of declining and ageing population, level of productivity and unemployment; and similarly it also distinguishes between intermediate regions close to cities and remote intermediate cities.
Figure 1.A2.1 summarises the methodology applied to derive the extended typology in the following steps.
Regions are classified as predominantly urban (PU), intermediate (IN) or predominantly rural (PR) based on the share of population living in local rural areas within each region and size of the urban centres contained in the TL3 regions. A region previously classified as PR (IN), becomes IN (PU) if it contains an urban centre with at least 200 000 (500 000 for Japan) inhabitants representing 25% of the regional population. These three categories are known as the OECD regional typology.
In a second step, the OECD regional typology is extended by considering the driving time of at least 50% of the regional population to the closest centre of more than 50 000 inhabitants. This only applies to the IN and PR categories, since by definition, the PU regions include highly populated localities. The result is a typology containing five categories: PU, INC, INR, PRC and PRR.
Note: Annex 1.A2 provides additional information.
Both the OECD taxonomy and the extended taxonomy define TL3 regions as the most useful context to examine how rural and urban development takes place. TL3 regions correspond in many countries to administrative units and in others to statistical areas. The usage of administrative and political boundaries, however, also brings disadvantages, such as an arbitrary definition of a territory that often does not correspond to patterns of life, job markets and business flows. It is to no surprise that the administrative boundaries of cities rarely contain the real extension of the built-up area around a city, nor do they capture all the important flows. The mismatch between functional and administrative boundaries can face difficulties in co-ordinating policies from different administrative units and miss out on potential synergies.