Does population decline lead to economic decline in rural regions?

Zuzana Gakova, European Commission
Lewis Dijkstra, European Commission

This presentation will show that population decline in rural regions rarely leads to economic decline. In addition, it demonstrates that the decline of population1 affects urban as much as rural regions. Lastly, it reveals that between 2000 and 2007 the increase in GDP per head was highest in rural regions in the EU-15, while in the Central and Eastern European Countries (CEECs) it was highest in urban regions. The first part describes population changes by type of region and shows that in the EU-15 population decline is more likely to occur in rural regions which have the lowest population share. On the contrary, in the CEECs, population decline is most frequent in the intermediate regions which represent the highest share of population. The second section concludes that economic decline can occur in all types of regions, but that the pattern is influenced by the level of a country's development. In the CEECs, growth is concentrated more in urban regions. Nevertheless, the economic growth of rural regions in CEECs was still above the EU average. This higher growth in urban regions is a result of a transition process and is expected to diminish over time.