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Shrinking Cities: East European Urban Trajectories 1960-2005 : 

Shrinking Cities: East European Urban Trajectories 1960-2005 Vlad Mykhnenko, Ivan Turok, and Maria Plotnikova Centre for Public Policy for Regions-(CPPR), University of Glasgow and University of Strathclyde CPPR-EUREAL Workshop 30th September 2006

Overall background: 

Overall background New conventional wisdom about the contribution of cities to national and regional growth contain the key drivers of innovation, creativity and productivity in advanced, knowledge-based economies provide vital economic, social, educational and cultural facilities to help attract and retain vital human capital and creative talent (‘buzz’) contain the assets and infrastructure to attract high order business and consumer services & tourism

Illustration: 

Illustration “Cities and metropolitan areas are drivers of economic development … creating growth, innovation and employment … The European Union will be most successful in pursuing its growth and jobs agenda, if all regions – especially those with the greatest potential for higher productivity and employment – are able to play their part. Cities are essential in this effort. They are the home of most jobs, businesses, and higher education institutions and are key actors in achieving social cohesion. Cities are the centres of change, based on innovation, entrepreneurship and business growth” (European Commission, 2005)

East European background: 

East European background A long ‘Great Transformational Depression’ of the 1990s (Kolodko, 2000) Followed by ‘tiger-like’ dynamism - high growth, large FDI (Spiegel Int’l Edition, 21 Dec 2005) Pro-business flexibility - low/flat taxes, deregulation, liberalisation, marketisation (The Economist, 14 Apr 2005) Property boom (‘The lure of central and eastern Europe proves irresistible to property investors’, The Financial Times, 13 March 2006) Large/capital cities on top of the world’s ‘league tables’: amongst the most expensive & the richest cities (Mercer 2006; UBS 2006) Small & medium East European cities – ‘loosing their dead-end feel’ (The FT, 9 Dec 2005) Old industrial cities hit the hardest –‘pittsburghs’ and ‘detroits’ in the making

‘The comeback of East European cities’: 

‘The comeback of East European cities’ “The city is being reborn ... The eastern European revolution, which implied a liberation of civil society, was also a revolution of urbanity, the beginning of a dramatic re-urbanisation […] Over the last two decades … we are observing the re-establishment of the city as a life-form with a civic-civil shape, and … we are in the process of reforesting the de-urbanised wastelands of the twentieth century ... The [city] centres and [building] sites show exactly where the main energy is flowing: to the construction of infrastructure – new airports, new port facilities, new train stations. The show movements within the cities: the internal urban migration – out to the villas in the new privileged neighbourhoods, or into the lofts and renovated old flats in the centres. They show the new needs: malls, shopping centres, drive-ins, fitness centres, gated communities … banks, offices of all kinds, hotels, entertainment worlds […] What is described here for the cities in Eastern Europe will effect the urban landscape all over Europe […] This is … where transnational, continental, intercontinental time is being produced” (Schlögel 2006)

Research Questions: 

Research Questions Are there any signs of a ‘comeback’ and improvement in the position of East European cities – in historical terms, relative to their national contexts, and continentally? Any obvious attributes associated with stronger or weaker city growth? size regional location national fortunes past-dependence

Population as an indicator of urban economic dynamism and growth: 

Population as an indicator of urban economic dynamism and growth A consequence of wider conditions in different places – differential employment opportunities A contributor to economic development – skilled labour, enterprise, demand for consumer & public services Both facilitated by rising personal mobility, wider regional disparities, falling international barriers (hence easier ‘adjustment’) and increasing policy attention Hence economic and demographic trends becoming more interdependent “there can be no doubt that at all stages of urban growth and decline there is causal interaction between population and employment movement” (Cheshire and Hay, 1989)

Link between population & employment trends: 

Link between population & employment trends Eurostat Regio Database (2006). EU-25: employment and population correlations in NUTS-1 regions, 1995-2003 UK: employment and population correlation in NUTS-2 regions, 1985-1995 Eurostat Regio Database (2006) and NOMIS (2006).

Five competing propositions concerning Eastern Europe: 

Five competing propositions concerning Eastern Europe Under-urbanised under state socialism: the rate of population growth in cities has increased/exploded in recent years and in relation to their national averages and historically Over-urbanised under state socialism: population in cities has declined and the level of urbanisation has been ‘corrected’ by market forces to the ‘normal’ levels Path-divergence: big and capital cities have performed better than smaller cities ‘cos of the larger scale of opportunities, assets & amenities geographical location maters: cities closer to the West (the core) , are growing more strongly than those in the periphery national socio-economic trajectories has diverged, hence those of their cities Natural demographic crisis: population in cities has declined as the result of low fertility/birth rates, ageing, mortality ‘Just sub-urbanisation’: the rate of population growth in inner cities has declined as the affluent classes move out from cities into ‘leafy suburbs’

Methods and data sources: 

Methods and data sources City as a continuous built-up area with over 200,000 population in 2000 Eastern Europe from the ex-GDR to the Urals Created by amalgamating constituent local authorities or using nationally defined urban agglomerations Yields 150 cities in 19 countries of Eastern Europe + East Germany They account for 30% of total population in Eastern Europe Data traced back to 1960 at 5-year intervals

Slide11: 

Key findings

A dramatic turnaround in city fortunes: almost every city was growing between 1960-1985; most are in decline today: 

A dramatic turnaround in city fortunes: almost every city was growing between 1960-1985; most are in decline today

Rates of decline in Eastern Europe are unprecedented in the post-war continental history: 

Rates of decline in Eastern Europe are unprecedented in the post-war continental history

Under-urbanised in the past? No accelerated urbanisation today: 

Under-urbanised in the past? No accelerated urbanisation today Relationship between urbanisation and city growth rates A comparison of West and East European levels of urbanisation and concentration (i.e. cities > 200k)

Over-urbanised in the past? Levels of urbanisation and population concentration in cities have stabilised - not plummeted down: 

Over-urbanised in the past? Levels of urbanisation and population concentration in cities have stabilised - not plummeted down

Path-divergence? Physical proximity to the West isn’t a blessing; distance from the West may be: 

Path-divergence? Physical proximity to the West isn’t a blessing; distance from the West may be

Path-divergence? Quality of life not an influence: 

Path-divergence? Quality of life not an influence

Path-divergence: relative improvement for large cities, absolute fall of medium & small cities: 

Path-divergence: relative improvement for large cities, absolute fall of medium & small cities

But not strong statistically: 

But not strong statistically

Path-divergence: capital cities are growing faster; almost the only growing cities: 

Path-divergence: capital cities are growing faster; almost the only growing cities

Past divergence: every city now equal in decline?: 

Past divergence: every city now equal in decline?

Path-divergence: national economic trajectories not an explanatory variable; city fortunes are: 

Path-divergence: national economic trajectories not an explanatory variable; city fortunes are

Natural demographic crisis: most cities have become growth laggards, following rather than leading national population change trends: 

Natural demographic crisis: most cities have become growth laggards, following rather than leading national population change trends

Natural demographic crisis? Yet half of the cities appear not affected : 

Natural demographic crisis? Yet half of the cities appear not affected

Natural demographic crisis? Yet some cities are ‘over-urbanising’, some are ‘de-urbanising’: 

Natural demographic crisis? Yet some cities are ‘over-urbanising’, some are ‘de-urbanising’

Natural demographic crisis - unnatural extremes? Tirana and Moscow v. Halle and Murmansk: 

Natural demographic crisis - unnatural extremes? Tirana and Moscow v. Halle and Murmansk

‘Just sub-urbanisation’? Not much difference in growth rates: 

‘Just sub-urbanisation’? Not much difference in growth rates

Emigration: the elephant in the room: 

Emigration: the elephant in the room

East European urban trajectories: three out of four are shrinking cities: 

East European urban trajectories: three out of four are shrinking cities

Use of Hierarchical Linear model to classify city growth patterns: 

Use of Hierarchical Linear model to classify city growth patterns Application by Maria Plotnikova

Rationale for Using the Methodology: 

Rationale for Using the Methodology Research objective: accounting for city-specific growth Interested in between city growth variability and within city growth variability Hierarchical Data Structure: cities nested within countries hence application of Mixed linear models/multilevel linear models

Hierarchical/Mixed Linear Model : 

Hierarchical/Mixed Linear Model Panel data: 150 cities, 9 time periods of 5 year growth increments Time divided in pre-transition and transition period (fixed effect, random effect of transition period) country and city fixed effects city random effects Random slope: city population share of country population

Cluster Analysis : 

Cluster Analysis Objective: identify and group cities with similar growth trends Wards Linkage clustering procedure on fixed and random effects for each city Cluster size is chosen based on values of diagnostic statistic

Preliminary Results 1: 

Preliminary Results 1 Pre-transition: countries-specific groupings are not pronounced and cities from different countries belong to same clusters Post-transition: more clustering based on countries

Preliminary Results 2: 

Preliminary Results 2 Bydgoszcz (PL), Naberezhnye Chelny (RU) are idiosyncratic outliers in both pre-post transition periods, i.e. have their own clusters Post transition: Separate grouping of all East German and most Polish cities together in Polish-German group of clusters Post-transition Belorusian cities clustered in neighbouring separate clusters Baltic capitals remain clustered together in pre-post transition

Conclusions: trajectories: 

Conclusions: trajectories Cities far out-paced national trends throughout the 1960s-1980s – partly planned, partly universal (yet failed) urbanisation ‘catching-up’ with the West Then dramatic slowdown lasting a decade Broadly stabilising at a slow rate of decline, analogous to national trends No recovery since the nadir of the late 1990s, except for a few large cities and capitals Four times as many cities are now shrinking than growing

Conclusions: propositions: 

Conclusions: propositions ‘Under-urbanisation’ hypothesis generally not confirmed ‘Over-urbanisation’ hypothesis generally not confirmed Internal/inherited strengths or weaknesses of cities (size, proximity to power, economic structures) are crucial; not national fortunes or geographic/physical qualities Natural demographic crisis is just a part of the story Sub-urbanisation isn’t a crucial factor behind the decline External and internal migration is the driving force of growth/decline Path-divergence is a powerful tendency turning towards polarisation: only one successful city for each three failing ones