OECD subnational regions are classified into two scales: large regions, referred to as Territorial Level 2 (TL2), and small regions, referred to as Territorial Level 3 (TL3). Large regions generally refer to the first government level after the national or federal one. Small regions are contained within large regions and, in the case of European countries, correspond to the NUTS3 nomenclature. Small regions can be classified based on their accessibility to cities (large metropolitan regions, midsize metropolitan regions, regions near a midsize/large Functional Urban Area (FUA), regions near a small FUA, and remote regions) (Fadic et al., 2019[1]).
OECD metropolitan areas are defined based on Functional Urban Areas (FUA). Developed in collaboration with the European Union and endorsed at the 2020 Statistical Commission of the United Nations, FUAs consist of densely populated cities together with their surrounding commuting zones. This definition looks at the full extent of cities’ labour markets to capture the economic boundaries of cities. FUAs are generally the aggregation of local units (L. Dijkstra; H. Poelman; P. Veneri, 2019[2]).
The degree of urbanisation (DEGURBA) classifies local administrative units as cities, towns and suburbs or rural areas based on a combination of geographical contiguity and population density. It facilitates international statistical comparisons and it enables to classify the whole territory of a country along an urban-rural continuum (UN-Habitat, 2021[3]).
In the Degree of Urbanisation definition, settlements are identified from clusters of adjacent 1 km2 grid cells with medium or high population density. Such clusters meet the criteria for settlements if their total population is also above a certain threshold (e.g. 500 persons for a village). The Degree of Urbanisation Levels 1 and 2 both define cities, but the Level 2 definition helps distinguish towns and villages – which are settlements – from suburbs and dispersed rural areas, which are not settlements.