Rural development policy from an EU perspective

Thomas Dax, Vienna, Austria

XXI Summer Course – XIV European Courses
”Desarollo rural y gestión territorial”
University of the Basque Country,
Donostia - San Sebastián, 1-2 August 2002


1. Introduction

With structural adjustment and integration of agriculture into the rural economy the concern for the development of rural areas in general has risen considerably over the last decades. Rural policy is no more primarily about agriculture but has to address specifically all different economic sectors and actors in the area. With fundamental changes in the market structures and relations programmes targeted at specific rural areas cannot neglect the emerging interrelations to other areas. Hence a rural policy has to address directly its insertion into the regional framework and its relation to regional policy.
It is rural policy which has received over recent years increasing political attention although there remain quite divergent views on the different concepts to be used and policy processes to serve the target of integration of sector approaches. The rural approach, albeit often alluded to as being similar to agricultural development, is in its core a territorial approach, applying regional policy measures for specific regions, the rural areas. Hence the following short introductory presentation focuses on both (a) the various policies with distinctive territorial dimensions and impact on rural areas and (b) rural development policy as addressed by EU policy reform and targeted at through EU agricultural policy via establishing a "second pillar" to Common Agricultural Policy (CAP). Before presenting the relevant EU regulations, the relevance of the concept of rural areas is revealed through the international comparison achieved by the OECD rural indicators project.

2. Rural diversity

In public discussion of regional development the term rural area is generally used as an expression for non-urban or peripheral regions. As the differentiation between rural and urban areas as opposite types of spatial structure is vague, attempts to define the spatial category of rural area are bound to create methodological problems. Views on the issue and the indicators to be dealt with vary ac-cording to specific social groups, national contexts and personal attitudes.
The term rural is used in many contexts without necessarily defining the concept or its spatial implications. Many practitioners of rural development work would share Newby's (1986, p. 209) opinion that “there is now ... a general awareness that what constitutes ‘rural’ is wholly a matter of convenience and that arid and abstract definitional exercises are of little utility”. Recently the diversity of rural areas is stressed and the disaggregation into different types is increasingly requested.
Amongst international attempts to classify the rural areas, definitions vary significantly. In some OECD (Organisation for Economic Cooperation and Development) countries no official definition of rural exists; or it is treated as a residual category, defined negatively in the sense of not being ‘urban’ or agglomerated, rather than explicitly specified by its own properties. The range of different criteria for designation of rural areas is reflected in the most commonly used ones: size of population; population density; commuting intensity; and proportion of labour force involved in agriculture. Furthermore, thresholds for the one criteria may vary considerably, e.g.

  • limits for population size of the agglomerated units range from 1000 to 10,000
  • density thresholds vary from 100 to 700 inhabitants per km2
  • share of agricultural employment ranges between 1.5 and 20%

OECD Rural Indicators – the concept

Increased concern with rural development problems in the industrialised world as well as deficits of international comparability have led OECD member countries to work on rural development issues in a more systematic way and to attempt to bridge the gap between varying concepts of 'rural'. For the OECD Rural Development Program, launched in 1991, one of the primary tasks has been to develop a common definition of the notion of rural area. The main task of the project an Rural Indicators has therefore been to elaborate a common geographical framework for rural areas; to explore possibilities for the collection and aggregation of comparable rural information at different territorial levels; and to identify a set of basic rural indicators. Information was to be provided an sub-national areas with a sufficiently high degree of differentiation and yet comparability to make international communication meaningful.

Key elements of the territorial scheme are illustrated at Figure 1 and include:

  • The scheme covers the entire territory and not just the 'rural' part. As rural analysis relies on the description of the differences and interrelationships between rural areas and other parts of the country, data for all parts are required to confirm the consistency of the results.
  • The scheme distinguishes two hierarchical levels of geographic detail. At the local community level it uses the basic administrative or statistical unit, in most cases the community, as the lowest geographical areas to be classified as 'rural' or 'urban'. The larger administrative units at regional level can generally only be classified as being 'more' or 'less' rural.
  • This distinction between the hierarchical levels of territorial detail is central to the conceptual approach of the Rural Indicator Project. Only through these different levels can the complexity of rural problems in various national and regional contexts be seized. The framework has to allow for analysis of interrelationships between regions but also to enable differentiation between rural and urban communities within a region at a lower geographic level.
  • rural is about people and territory, the Rural Indicator Project selected the simple and intuitive criteria of population density, calculated as inhabitants per km2, which OECD members could agree to as the basis for the territorial framework (OECD 1994, p. 22).
  • The setting of the threshold at 150 inhabitants per km2 took into account population density thresholds used by member countries; the distribution of local community population and area; and the wide range of settlement patterns across the OECD.

Through this working definition the specificity of rural areas (communities) was reduced to just one dimension - a relatively low density. In reality, rural areas in the OECD reflect numerous and heterogeneous problem patterns and it was an important task of the project to understand and communicate this diversity better.
Division of communities into rural and urban by the simple criterion of population density was then used as basis for the second, regional, level. As regions usually comprise rural as well as urban communities, the degree of rurality was calculated by the share of people living in rural communities. Three types of regions were thus distinguished:

  •  predominantly rural areas
    more than 50% of the population lives in rural communities
  • significantly rural areas
    the share of the population in rural communities is 15-50%
  • predominantly urbanised areas
    less than 15% of the population is in rural communities.

Divergence of rurality

About one third of the total OECD population live in rural communities, occupying over 95% of the territory. National shares differ considerably, ranging from a rural population of less than 10% in the Netherlands and Belgium to about 60% in Finland, Norway and Turkey.

At the regional level the degree of rurality is described by the distribution of the three types of regions within each OECD member country (Figure 2). In some OECD countries, in particular the Scandinavian countries and Austria, more than three quarters of population live in either predominantly rural areas or significantly rural areas, reflecting the high degree of rurality at the regional level in these countries. For Japan and the north-western European countries, in particular the Netherlands, Belgium, Germany, the UK and Switzerland, the opposite is the case.

France, Portugal, Canada and the USA have a rather balanced structure, while Italy, Spain and the EU as a whole are characterised by a greater population share in urbanised regions. Ireland, Iceland, and to some extent Australia and Canada, have a dual structure with greater shares of their population inhabiting the rural and urban extremes and only a smaller fraction living in the intermediate regions. In Australia, in particular, the share of population living in the predominantly urbanised regions reaches 55% and the share in predominantly rural regions 23%. Moreover, the significance of this latter type can be underlined by the fact that 92% of Australia's total area belongs to the latter category.

The appropriate level for territorial analysis therefore depends on the question under review. If, for example, territorial differences in employment opportunities are to be assessed in an economic policy perspective, information should be analysed at the regional level. The premise is that within reasonable distances workers should be prepared to commute between their place of residence and the place of work. This may imply commuting from a rural to an urban area. It would not be a realistic rural policy objective to provide jobs for rural citizens only in their own (rural) community. A reasonable aim would be for rural citizens to find jobs within an acceptable commuting distance from where they live. The place of work could well be urban but it should be within the same region or labour market area. The distinction between three types of region allows an analysis of job opportunities under the different regional conditions.

The further analysis of the economic performance of rural regions in the OECD countries could provide a number of indicators that rural must not be equated with economic backwardness. In all the OECD countries there are also dynamic rural regions to be found. Nevertheless one has to admit that the majority of regions and the overall impression of rural areas is determined by the economic weak regional situation and the threat of out-migration. The difference at the regional level is experienced within the states observed and shows in some countries (like in Spain) an especially high disparity between leading and lagging rural regions (Figure 3) when calculating the employment changes as indicator for economic success.