The fourth edition of the OECD Regional Outlook: Leveraging Megatrends for Cities and Rural Areas, comes at a timely moment when regional disparities have become the focus of significant public attention. In underperforming regions, persistent gaps in socio-economic outcomes have led to growing discontent with the political and economic status quo. The distinct geography of discontent that has emerged has provided a powerful reminder of the urgency to address regional inequalities.

The publication of this edition of the Regional Outlook also coincides with the 20th anniversary of the OECD Regional Development Policy Committee. Since its creation in 1999, the committee has consistently argued for place-based policies to ensure that all regions use their full economic potential and reduce regional inequalities. Today, this recommendation has become an integral part of the OECD policy package and is more important than ever.

Place-based policies can effectively address the diversity of economic, social, demographic, institutional and geographic conditions across regions. They target specific territories and provide the tools that traditional structural policies often lack in order to address the region-specific factors that cause economic and social stagnation. They also ensure that a wide range of sectoral policies, from transport and education to innovation and health, are co-ordinated with each other and meet the specific needs of different regions across a country – from remote rural areas to the largest cities.

Global megatrends related to technological, demographic and environmental changes will increase the importance of place-based policies in the future. These trends are affecting all OECD regions today and their effects will only grow stronger. While these megatrends are well-known, their regional dimension is rarely discussed. Yet, as this report points out, their effects are far from uniform within countries. By discussing how regional policy can respond to these asymmetric impacts, this report fills a critical gap.

With the right policies, global megatrends will offer tremendous opportunities to revive productivity growth, reduce inequalities, improve quality of life and increase sustainability. For example, new technologies will increase the importance of knowledge-based services that are predominantly located in cities. Yet, rural areas can benefit from the distance-mitigating effects that autonomous vehicles, drone deliveries, 3D printing and better communication technologies will offer. However, if policy makers do not take appropriate action today, global megatrends can contribute to an increase of regional inequalities and will divide countries further into thriving regions and those that are left behind.

This Regional Outlook aims to serve as a guide to help policy makers at all levels of government to leverage global megatrends. It analyses the likely range of scenarios that will be confronted in the future by different regions and, insofar as possible, presents steps that policy makers can already take today to shape the next generation of regional policies.

The Regional Outlook’s Policy Forum section (Part II) allows senior decision makers and distinguished scholars to present first-hand perspectives on regional responses to global megatrends. It provides a unique perspective on what needs to be done to future-proof regional policy, in order to deliver better lives for our populations.


Angel Gurría

OECD Secretary-General

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