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The OECD functional urban area definition

As a response to this challenge, the OECD, in collaboration with the EC, has developed a new approach for classifying functional urban areas with the aim of comparing the key functional areas among OECD countries in terms of economic activity. These metropolitan regions are made up of both urban and rural territory. By applying a uniform definition and criteria, international comparability is assured and monitoring and comparing urban development within and across OECD countries is enhanced (see Box 1.3 and Annex 1.A3). It also differentiates functional urban areas of different sizes, providing new tools for better understanding urban dynamics for different sized metropolitan regions. This work is developing at a time when the urban agenda is at the heart of policy debate in many OECD countries. Thus, redefining what is urban responds to a need of governments for evidence to design better policies for different types of urban areas (OECD, 2012).

According to the functional urban area (FUA) definition, there are 26 FUAs in Chile, home to 12.1 million inhabitants in 2010 corresponding to 73.2% of the national population. This leaves 26.8% of the population outside a major urban area. When comparing this figure to that of other OECD member countries, Chile has a higher metropolitan share than the OECD average, only surpassed by Korea, Luxemburg, Turkey, Japan, the United Kingdom and the Netherlands.

Box 1.3. Methodology for defining functional urban areas

The OECD-EU identifies functional urban areas (FUAs) beyond city boundaries, to reflect the economic geography of where people live and work. Functional urban areas are relatively self- contained economic units, characterised by high levels of labour linkages and other economic interactions. Cities are widely accepted as important generators of wealth, employment and productivity gains. Moreover, large agglomerations are key players of transnational flows and work as essential spatial nodes of the global economy. Thus, often metropolitan areas are essential interconnected units in the global economy.

Defining urban areas as functional economic units can better guide the way national and city governments plan infrastructure, transport, housing and schools, space for culture and recreation. Improved planning will make these urban areas more competitive to support job creation, and more attractive for its residents.

The methodology identifies urban areas as functional economic units, characterised by densely inhabited “urban cores” and “hinterlands” whose labour market is highly integrated with the “cores”. This methodology is a clear example of how geographic/morphologic information from geographic sources and census data can be used together to get a better understanding of how urbanisation develops. Information on the distribution of the population at a fine level of spatial disaggregation - 1 km2 - are used to identify more precisely the centres or “cores” of the urban space, defined as contiguous aggregations (“urban clusters”) of highly densely inhabited areas (grid cells). The hinterlands of these internationally comparable urban cores are defined using information on commuting flows from the surrounding regions.

Such a definition is applied to 30 OECD countries and identifies 1 179 functional urban areas with at least 50 000 inhabitants. Functional urban areas have been identified beyond their administrative boundaries in 30 OECD countries. They are characterised by densely populated urban cores and hinterlands with high levels of commuting towards the urban cores. The share of national population in FUAs ranges from 87% in Korea to less than 40% in Slovenia and the Slovak Republic.

Box 1.3. Methodology for defining functional urban areas (cont.) Percent of national population living in functional urban areas, 2012

Source: OECD (2013), OECD Regions at a Glance 2013, OECD Publishing, Paris, http://dx.doi.org/10.l787/reg glance-2013-en.

Among the 1 179 OECD functional urban areas, 77 have more than 1.5 million people, 198 between 500 000 and 1.5 million people, both groups concentrate almost 75% of the total urban population. Additionally, 406 were identified between 200 000 and 500 000 people, and 498 are small functional urban areas with a population below 200 000 and above 50 000 people (see figure below).

Number of functional urban areas (FUA) and population share by FUA size, 2012

Source: OECD (2013), “Metropolitan regions”, OECD Regional Statistics (database),

http://dx.doi.org/10.1787/data-00531-en (accessed on 15 December 2013).

Figure 1.2. Location of functional urban areas in Chile

Note: This map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map.

Source: OECD (2013), OECD Urban Policy Reviews: Chile 2013, OECD Publishing, Paris, http://dx.doi.org/10.1787/9789264191808-en.

The FUA definition and the OECD regional taxonomy are based on two different methodologies and measure different realties: the former captures the integration of urban and rural territories into a single local labour market based on commuting patterns. It includes both an urban core and a peri-urban hinterland containing strong urban and rural interactions. By contrast, the regional taxonomy is based on administrative boundaries and captures the wider context in which urban and rural development takes place. Predominantly rural regions can contain urban cores if the share of the population living outside the urban cores exceeds 50%. Each definition conveys different information.

Despite the different dimensions that both OECD definitions measure, the share of the national population living in rural areas differs significantly to the figure provided in Chile’s official definition (see Table 1.3).

For the case of Chile, the current official definition delimiting urban and rural areas could benefit from some of these recent advancements and better capture the urban and rural realities, recognise and define areas with strong urban and rural interactions, and differentiate among different types of rural areas for the case of Chile. These are discussed in the next section.

Table 1.2. Functional urban areas in OECD member countries

Korea

Total urban population 43 316 990

Share of national population 87%

Number of functional urban areas 45

Luxembourg

436 308

83%

1

Japan

99 535 286

78%

76

United Kingdom

46 876 023

74%

101

Netherlands

12 388 123

74%

35

Chile

12 745 119

73%

26

Canada

25 501 595

73%

34

Spain

31 925 818

69%

76

United States

215 171 557

69%

262

OECD (29) total

762 591 707

67%

1 179

France

41 421 986

65%

83

Mexico

72 560 224

65%

77

Germany

52 151 696

64%

109

OECD (29) average

26 296 266

60%

41

Belgium

6 554 869

59%

11

Austria

4 877 899

58%

6

Switzerland

4 469 076

56%

10

Ireland

2 554 821

56%

5

Portugal

5 848 843

55%

13

Estonia

742 860

55%

3

Poland

21 103 513

55%

58

Denmark

3 054 845

55%

4

Sweden

5 057 691

53%

12

Finland

2 830 124

52%

7

Italy

30 721 201

51%

74

Hungary

5 026 453

50%

10

Greece

5 543 737

49%

9

Norway

2 368 967

48%

6

Czech Republic

4951 914

47%

16

Slovenia

820 060

40%

2

Slovak Republic

2034 109

38%

8

Source: Based on OECD (2013), Redefining "Urban”: A New Way to Measure Metropolitan Areas, OECD Publishing, Paris, http://dx.doi.org/10.1787/9789264174108-en.

Table 1.3. Share of the national population in Chile living in rural areas, 2012

Share of national population, 2012

Official definition

Rural areas

13.1%

OECD typology TL3

Predominantly rural

34.6%

FUA (OECD)

Rural areas outside the FUA

26.8%

Note: The FUA figure does not include the share of rural population in FUAs, therefore it underestimates the total rural population.

 
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