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Assessing the performance of Chilean regions

This section first provides a general overview of growth trends among predominantly rural OECD TL3 regions excluding Chilean regions due to data availability. It then examines the performance of Chilean regions over the period l995-2011, paying particular attention to the period before and after the global financial crisis in 2008. The performance of Chilean regions focuses on TL2 regions due to availability of data benchmarking their performance to OECD TL2 regions. The analysis proxy’s rural regions with two indicators: density of population and degree of rurality. Both indicators have advantages and drawbacks.

General trends in OECD rural regions

This section displays the main growth trends in OECD rural regions using the OECD taxonomy defining three types of TL3 regions (urban, intermediate and rural) and the expanded OECD typologies differentiating rural regions close to cities and rural remote regions (see beginning of section). In sum, there are three main trends:

  • • First, there is no single pattern of growth among OECD TL3 regions. Predominantly rural regions appear disproportionately represented among the fastest and slowest growing regions. Overall, per capita growth has been stronger, on average, in both remote rural regions and in rural regions close to major cities, than it has been in intermediate regions, which in turn, have outperformed urban regions (Figure 1.27). This suggests that the recipe for high sustainable growth rates is not unique and that strong growth can indeed be achieved in many different types of regions. The greater heterogeneity in rural regions’ performance might well point to a greater variation in the challenges facing such regions, but the data provide little support for the widely held belief that rural regions are necessarily in decline.
  • • Second, rural regions collectively are the most dynamic type of region in the OECD, particularly rural regions close to cities. As a whole, rural regions performed better in terms of GDP per capita growth than intermediate and urban regions over 1995-2009. Amongst rural regions, those close to cities were more dynamic than remote rural regions and both types of rural regions grew faster than intermediate and urban regions. In terms of productivity growth, although rural regions as a whole also surpassed the productivity growth of urban and intermediate regions over 1995-2009, amongst rural regions there were large differences: on the one hand, rural regions close to cities displayed a high rate of productivity growth over 1995-2009; on the other hand, rural remote regions displayed the lowest rates of productivity growth.

Figure 1.27. Initial GDP per capita and annual average growth rates in GDP per capita among predominantly urban and rural regions, 1995-2009

Note: The vertical and horizontal lines correspond, respectively, to the OECD urban and rural average growth rates and the average income level. Regions from Australia, Canada, Chile, Iceland, Mexico, New Zealand, Switzerland and the United States are missing due to a lack of GDP data for TL3 regions.

Source: OECD (2013), OECD Regional Statistics (database), http://dx.doi.org/10.1787/region-data-en, (accessed on 15 December 2013).

• Third, rural regions also appear to be experiencing both a process of convergence and increased variability (Figure 1.29). Over 1995-2009, rural regions recorded faster growth in regions with lower levels of GDP per capita. The highest growth rates (above 3.5%) of all regional types are chiefly to be found in regions with below average initial GDP per capita. Rural regions with above average levels of GDP per capita appear to be growing more slowly. Figure 1.29 also shows greater dispersion of regional growth rates for lagging regions. This implies that some regions far away from the production frontier are catching up quite rapidly, while others may be losing sizeable growth opportunities.

These three patterns reveal the strong growth potential that exists in rural regions, particularly in rural regions close to cities in terms of productivity growth and GDP per capita growth.

Figure 1.28. GDP per capita growth and labour productivity growth amongst OECD types of regions, 1995-2009

Note: “Urban” refers to predominantly urban regions; “rural” refers to predominantly rural ones. Regions from Australia, Canada, Chile, Iceland, Mexico, New Zealand, Switzerland, Turkey and the United States are missing due to a lack of GDP data for TL3 regions.

Source: OECD (2013), OECD Regional Statistics (database), http://dx.doi.org/10.1787/region-data-en, (accessed on 15 December 2013).

Figure 1.29. Growth trends in predominantly rural regions, 1995-2009

Note: “Urban” refers to predominantly urban regions; “rural” refers to predominantly rural ones. Regions from Australia, Canada, Chile, Iceland, Mexico, New Zealand, Switzerland, Turkey and the United States are missing due to a lack of GDP data for TL3 regions.

Source: OECD (2013), OECD Regional Statistics (database), http://dx.doi.org/10.1787/region-data-en, (accessed on 15 December 2013).

 
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