16/06/2016 - Income inequality is worsening within many countries, and regional disparities in housing, safety and air quality inside countries are also growing wider in many cases, according to a new OECD report.
OECD Regions at a Glance 2016 finds most countries are closing the gap between regions in education and Internet access, but disparities in GDP per head, disposable income, safety and air pollution are widening in many. The disposable income per capita gap between the richest and poorest parts of OECD countries grew 1.5% a year on average over 2000-13, with the biggest increases in the Slovak Republic, Australia, Czech Republic and Canada.
The report, which examines local-level indicators in over 40 countries, shows many regions are struggling to increase the productivity of firms and people and restore employment. Italy, Spain and Turkey all show a 20 percentage point gap between highest and lowest regional unemployment rates, the same difference as between the national unemployment rates of Greece and Norway.
“Understanding the regional inequalities hidden behind country averages can help us to improve well-being and prosperity at a national and global level, in line with the Sustainable Development Goals,” said OECD Deputy Secretary-General Mari Kiviniemi, presenting the report at the European Committee of the Regions 118th Plenary Session. “We need a full dashboard of indicators and our job is to get them all moving in the right direction.”
Regional disparities in household disposable income
The report covers all 34 OECD countries plus, where data are available, Brazil, China, Colombia, India, Latvia, Lithuania, Peru, Russia and South Africa.
It is accompanied by the OECD’s Regional Well-being website, which shows how 395 sub-national regions in the 34 OECD countries perform in 11 areas: income, jobs, education, health, safety, environment, housing, life satisfaction, civic engagement, community and access to services. It gives them a relative score out of 10 for each well-being dimension.
The website classifies regions as the first administrative tier of sub-national government, for example Provinces in Canada, Länder in Germany and States in the US.
The 11 factors, shown as coloured “petals”, are based on data such as disposable income per capita and voter turnout, measured at a local level. Clicking on a petal reveals the underlying indicator and a scoreboard ranking the region against others and positioning countries by inequality.
Other findings from the regional data include:
Understanding regional variations is important given local and regional governments carry out around 40% of public spending and 60% of public investment in OECD countries. They play a key role in public procurement and providing jobs, education and social services.
"This publication will help to inform us on the new dynamics within Europe, from changing rural and urban populations' patterns to changing age demographics. The European Committee of the Regions and the OECD have a vital role to play in spreading good practices and guiding countries, regions and cities in the implementation of the OECD's recommendations," said CoR President Markku Markkula of the report.
For further information, or to speak to one of the OECD’s regional well-being analysts, please contact Catherine Bremer in the OECD’s Media Division (+33 1 45 24 80 97).