The Romanian Economic Journal
The Romanian Urban Network
Jurnalul Economic
Silviu Negut, Claudia Popescu 3
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City image. The dynamic of inside perception between 2001 Marius Cristian Neacşu and 2004. Case study: Ploieşti
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Magnifying Firm Dynamics. Micro Level Dynamics in a Population of Dutch Firms, 1998-2003
Paul van Steen
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The urban micro region: Deva - Hunedoara - Călan Simeria
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Dysfunctions in the large urban habitat Berceni – Bucharest Alex Gavris
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Border and Labour Market
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Martin van der Velde
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Anul VIII, nr. 16
Jurnalul Economic
iunie 2005
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The Romanian Urban Network Prof. Silviu Neguţ, PhD.; Lect. Claudia Popescu, PhD. Academy of Economic Studies, Faculty of International Business and Economics – Bucharest The paper is aiming to provide a comprehensive outlook of the Romanian urban network from the beginning of the second half of the 20th century onwards, still emphasizing the recent urban developments. The study briefly reviews the long-term evolution of the geographical distribution of towns by demographic size. Major shifts in urban dynamics have occurred after 1990 due to deep on-going social and economic changes. Comparative advantages of urban areas have dramatically declined halting the half a century-long rural to urban transfer of population. Recent urban developments have slightly changed the concentration pattern of the urban population and the size and shape of urban polarization areas, but have determined profound changes of intra-urban relations. Dramatic changes occurred in the urban functional types. Finally, the content and the impact of the latest urbanization wave are discussed. Long-term urban dynamics In the second half of the 20th century, Romania recorded radical changes of social and economic development due to the ideologically driven policies. During this period, there were two turning points into the main trends of urban development: the first one was in 1948 that marked the passage from the capitalist economy to the centralised plan-based socialist system and the second was 1990 when the socialist economy began being replaced by the market economy. The 20th century witnessed an impressive increase in town number, an over twofold growth recorded at different stage in time and intensity: 23 new towns were declared in 1930 and 1989 each, 49 in 1968 and the most recently, 53 in the period following the year 1990. The consequence of this increase was, among others, the strengthening of the county urban netAnul VIII, nr. 16
works and their better balanced distribution within the national territory (Urucu et al., 2005). All along this period, the numerical increase of towns was achieved either by changing the legal status of some localities which boasted a new, dynamic economic and socio/economic life, or in a few cases by the construction of new towns planned mainly to perform industrial activities. The involvement of the political factor played a major role in the distribution of towns by category of size, in their balanced territorial spread and the formation of an urban network comfortable with the goals set by the central power (Urucu et al., 2005). For example, the new administrative-territorial division set up in 1968 was the best evidence of such a policy. Urbanisation was conceived as a political tool for the implementation of politically influenced development strategies. After 1950, industrialisation appeared to be the most important objective of the ecoiunie 2005
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nomic policy, thus the emphasis was placed on emergence of new towns. Boosting productive activities was a must for any urban centre, so the majority of the new towns was specialised in industry. Many small towns appeared as a consequence of previous industrial location and expansion. Their subsequent socio-economic dynamics showed a closed dependency on industrial evolution which became a source of vulnerability after 1990 when industrial decline hit mostly the small towns. Since 1990, the overall population of Romania has been in steady but slow decline due to mainly, a dramatic natural fall and, secondary, an increasing outward migration. The pace of urban demographic evolution in the latter half of the 20th century differed with each category of town and stage, in line with the objectives set by the central power, to balance the county urban network by increasing the number of new towns. It also reflects the economic and social level attained by the urban system in various stages. According to in-
creases or decreases of urban population, a certain regional grouping of towns can be observed. For example, in the last decade of the 20th century, towns with a growing population were located in Central and Northern Moldavia, Southern Dobrogea, the Getic Piedmont and North-West Transylvania. Negative rates were recorded mainly by the Braşov Depression and the Prahova Valley, the Western Plain, parts of the Romanian Plain, the Subcarpathian depressions and the south of the Moldavian Plateau. Romania’s recent demographic evolution is similar to that of other former socialist Central and Eastern European countries. The urban population is following the same trend because of the social and economic restructuring of urban economies. The urbanization rate, of 53.4%, has registered a slight increase recently, but still is one of the lowest in Europe. This explains the latest urbanisation wave, started in the late 1990s and continued at higher speed after 2000 (Fig. 1).
% 100
75
Rural Urban
50
25
21.4
23.4
1930
1948
31.3
38.2
54.3
52.7
53.4
1992
2002
2003
43.6
0 1956
1966
1977
year
Fig. 1. Urban and rural population ratio Anul VIII, nr. 16
iunie 2005
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Jurnalul Economic During the second half of the 20th century, the urbanisation rate has doubled, passing from 30% to more than 50%. The evolution was slower in the first half and faster in the second one due to politicaldriven urban development, followed by a slight regression at the beginning of the 21st century. The maximum value was reached in 1997, when the urbanization rate was of 55%, but the trends afterwards were of slow but steady decline. The growth of the urban population was the outcome of a number of factors, such as natural increase, rural inflows into the town, the urban status granted to some communes and the inclusion of some villages within the administrative extent of towns. The intensity of this process depended on the geographical region and the type of town. Although the ratio between these factors registered temporal changes, yet the high proportion of villagers adding to the urban population growth was a constant of the 1960-1990 period. After a long period of industrialisation-induced urban growth, the Romanian towns are facing a structural and functional crisis, due to cumulative effects of natural decrease, dramatic reduction of rural to urban migration, economic slowdown, reduced potential to diversify the urban economy and to attract dynamic activities. The severe impact of recent economic and social turmoil has been recently acknowledged by the United Nations population forecast. The 2000 projection is less optimistic than the one worked out in 1990, announcing a rate of 66.9% instead of 72.3% as previously projected (World Urbanization Prospects, 1990; UNO, Division of Statistics, 2000). Anul VIII, nr. 16
The distribution pattern of towns has recorded substantial changes during the second half of the 20th century. In 1966 the urban system still preserved the regional heritage from the beginning of the century, with higher densities of towns in the central and western part of the country. Larger concentrations of big towns are specific to Transylvania, whereas in the former Romanian kingdom their position is peripheral. Small and medium-sized towns largely outnumber the big ones, with dominantly agrarian functions and acting as basic services suppliers for large rural areas. The regional cities attracted major investments and contributed the most to the urban growth before 1966. In 1968 a new administrative territorial division was put in place, with counties replacing the former regions. A number of medium-sized towns turned into county-seats and concentrated the major part of the nation-wide urban dynamics. The centralized policy promoted the balanced development in the view of bridging the regional gaps in terms of towns’ distribution. Huge investments were directed to lagging behind regions, as Central Moldavia, Central Muntenia and Maramureş. Along with the urbanization process, the town system tended to a relative stability, functioning in a politically homogeneous environment. Just before the end of the socialist period, in April 1989, a number of 23 communes were granted the urban status. Most of them recorded socio-economic values below the average of those particular to big villages. From the functional point of view, the emphasis has been put on agricultural and industrial activities, ignoring mostly the tertiary sector. The selection process of iunie 2005
6 new candidates to township was aimed to enhance the even distribution of towns and not to meet the requirements of urban development. The urban network, counting 260 towns and cities, was characterized by: insufficient number of big towns (9% of the total) but they are dominant in the urban population break-down (45% of the total); the over-representation of small towns accounting for 70% of the total in number; and last but not least, the substantial proportion of county-seat towns because of their role in transmitting the political decisions at the regional level. So, the urban hierarchy was closely linked the administrative-territorial structure. The large cities with over 100,000 inhabitants are represented by the majority of the countyseats, important industrial and services centres, major national transport knots, university and cultural centres. They have a distinct impact on the country’s social and economic evolution: every second towndweller and every fourth inhabitant of Romania is a large city dweller. Their population dominates the urban settlement system and the territorial structure of the national economy. The concentration of population into large cities is the outcome of industrial production concentration. Medium-sized towns represent one third of the total number and play a major role in the national urban structure as a quarter of them are assigned the coordination of the counties. Their huge industrial units made them quite vulnerable and the lack of functional flexibility enhanced the slow development of services. Small towns account for two thirds of the number but they have a low demographic potential. They have registered a continuous increase in number, but they reduced their share Anul VIII, nr. 16
Jurnalul Economic into the total urban population to a half from 1930 to 2002. They are very different in functionality, including agro-industrial, industrial, spas and health resorts with a relatively well balanced distribution in space. Unlike the other two categories of towns, the small ones stayed at the periphery of the industrial and social progress and had to cope with many hardships in the course of their development. As a result, they are a pool of migrants for large cities (Urucu et al., 2005). After 1990, a new generation of towns has emerged, totalizing 53 units up to the beginning of this year, and the process is in progress. Although relatively dispersed across the national territory, the new towns cluster in particular parts of the country, rendering greater the gaps in terms of geographical distribution at the county level. As regards the demographic evolution, there is a clearcut distinction between the cities where company headquarters, research activity and education and cultural facilities are concentrated on the one side and the medium-sized and small towns with limited opportunities of economic development on the other side. The main characteristics of the urbanization process have generated important hierarchical distortions over time. The rank-size relations revealed a decrease in the median and upper sectors of the hierarchy as against the optimal line in 1948. The context was a special one, immediately after the Second World War, followed by a long lasting famine, an intense emigration flow including especially the Jewish population and the turmoil determined by the transition to the communist rule. Important changes have occurred afterwards. In the mid 1960s most medium and small iunie 2005
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Jurnalul Economic towns were grouped under the theoretical adjustment line, whereas at the beginning of the 1990s they were above it. The medium-sized towns were disturbed in their demographic evolution in the 1970s when many of them became county-seats and received huge flows of capital and investments. The inflow of labour force was a response to the economic explosion of this category of towns. This impressive leap was due to rapid industrialization associated with infrastructure and social developments in order to host the rural to urban exodus. The demographic increase of the county seats lays at the basis of the hierarchical distortions: during 1966-1992 they contributed with two thirds to the total urban population growth. Nevertheless, one can distinguish some differences among them: the former regional capitals with slower evolution and the new county-seats established in 1968 with faster increase. In fact, the explosive growth of the county seats was responsible for the over-sizing of the median sector, and hence underdevelopment of the upper and lower ends of the national urban hierarchy (Ungureanu, 1996). The recent urban developments have slightly changed the rank-size distri-
Anul VIII, nr. 16
bution of towns. The pattern still shows the same features as before 1990: very small number of cities but with a higher share in the urban population; mediumsized towns acting as a buffer in the middle of the urban hierarchy; an increasingly large number of small towns undergoing a drop of population. In comparison with early 1990s, when the most of medium and small towns were grouped above the theoretical adjustment line, due to their intense industrialization and demographic growth, in 2002 the most of them are found under the line because of the economic restructuring and population fall. The concentration pattern of urban population shows the dominance of the capital city and the county seats in the detriment of the small towns. The latter category represents two thirds of the total number but hold the same proportion of population as Bucureşti. The recent increase in the number of towns has no important impact on the rank-size relation. Although significant in number, the new comers in the urban hierarchy are exclusive representatives of small towns whose population is generally up to 10,000 inhabitants (Fig. 2).
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No. inhabitants 100000000 1000000 10000 100 1 1
10
100
1000 rank
2005
No. inhabitants 100000000 1000000 10000 100 1 1
10
100
1000 rank
Fig. 2. Rank-size distribution of towns The shape and the size of urban polarizing areas help us to distinguish the main pillars of the urban network: first of all, Bucharest is one of the finest examples of primate city in Europe; the ratio with the second ranked city in the urban hierarchy has been increasing in the last period from 5.9 in 1992 to 6.1 in 2002, although Bucharest is recording a demographic decline as well. Anyway, the regional cities are undersized in terms of population number. To efficiently coordinate the national territory they should reach 500-600 thousand inhabitants. Secondly, the regional cities seem to regain their coordination role of the national urban system. Before 1990, this role belonged to countyseats, considered to be at that time as the Anul VIII, nr. 16
main cores of the economic structures. As a result, the urban system has been split into a federation of subsystems made up of small towns acting as urban cells subordinated to the county seat. The small towns used to act strictly inside the county frameworks, their urban vitality being compromised at the expense of the county seats dynamics. About 85% of the settlements have evolved within the closed county urban structures. Two features were outstanding: the strong fragmentation of the national urban system and the territorial intra-urban competition has been annihilated in the favour of administrative competition. The general morphology of the regional subsystems of settlements indicates the dominance of the monocentric iunie 2005
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Jurnalul Economic type, gathering around one single coordination centre, such as those in Oltenia, Banat. The Moldavian system shows obvious bicentric trends, and the policentricity is well marked in Transylvania. Urban functionality Analysing the economic and social activity of Romanian towns in the post-war period reveals that the dimension and characteristics of the general urbanization process suffered radical changes comparatively with the pre-war period and with the particularities of this process in Europe. In the first half of the 20th century the Romanian towns had a specific functional structure, dominated by agriculture, mining, industry related to natural resources processing and traditional handicrafts, services especially trade and transport. After the Second World War, the traditional town as the place of production and exchange of nonagrarian products was replaced by the industrial urban centre. The 1956 Census data show an over 25% growth of industrial workforce, with almost 50% in the large cities and up to nearly 75% in the industrial towns. The 1970s and 1990s featured extensive industrialization, nearly all the Romanian towns being intensively developed and growing into economic centres, the medium-sized towns performing mainly industrial functions. In that period, more than 90% of the industrial output and value was supplied by towns. Over 45% of the active town population worked in industry. In the whole, the post-war functional profile of towns has changed as a result of late industrialization from the pre-war services-industrial and agrarianservices type to the dominantly industrial Anul VIII, nr. 16
and mixed (industrial and services or industrial and agrarian) types but very seldom services (Urucu et al., 2005). From the functional point of view, the most of the towns, including the big ones, developed industrial functions all along the second half of the 20th century. In this respect, striking similarities between the urban and industrial hierarchy came to define the urban network. The contemporary period, subject to a state-controlled industrialization policy, brought about dramatic changes in the orientation and rate of urban population dynamics, due to inconsistent socio-economic solutions, and gradual exhaustion of specific natural resources. According to different authors (Ungureanu, 1996), there are three successive stages in this period: -1948-1966, the urban population nearly doubled (+96.8%), and heavy industry centres located preferentially in the central-western part of the country surged (Hunedoara, Baia Sprie, Baia Mare; -1966-1977, the industrialization drive targeted some towns in the Romanian Plain (Slobozia, Alexandria, Urziceni), Getic Piedmont (Slatina, Balş, Filiaşi), Siret Passageway and Northern Transylvania. This new orientation of the industrialization policy highlights the growing importance of relational functions and the efforts to re-balance economic activities in the country. However, this policy shift did little to stop the decline of some small towns, such as those located in the Moldavian Plain; -1977-1992, is marked by a visible decline of urban dynamism (only a 31.9% increase) and only few small and mediumsized towns (Mioveni, Năvodari, Rovinari) continued to attract the labour force. At iunie 2005
10 the same time, ever more urban centres (35, i.e. 13.4%) recorded demographic losses, particularly the mining centres, where natural deposits kept exhausting (Cavnic, Anina, Zlatna). Another specific stage can be added after the radical changes brought about by the early 1990s: -1992-2002, the general trend is that of moderate decline due to socioeconomic changes (industrial restructuring, worsening of the living standard). The result was the dramatic decline of the natural increase of the population due to extremely low fertility and birth rates, and above all the reduction of in-migration flows. Only 10% of the total number of towns has registered a population growth, mainly young towns declared in 1989 and some others in the surroundings of Bucureşti or local centres of food production. As recently synthesized, according to the evolution of the urban economic activities, there were several successive stages during the second half of the 20th century: the development of regional capitals and the creation of new industrially specialised towns (1950-1970); the industrialization of county seats and mediumsized towns especially by big industrial units (1970-1980); the industrialization of small towns and rural settlements planned to become agrarian-industrial centres (1980-1989); the industrial decline after 1990 with various intensities according to the former industrialization level, age, size, and position within the settlement system. At the beginning of the 1990s, the industrial employment exceeded 50% in half of the total number of towns and 40% in three quarters of them. The agricultural employment was dominant in 3% of the Anul VIII, nr. 16
Jurnalul Economic towns, in two exceeding 50% and others four exceeding 40%. Constructions were still important in many towns where huge industrial investments were in progress (Cernavodă due to the nuclear power station here under construction, ports along the Danube and the Black Sea coast, towns located along important rivers where hydroelectric power stations were to be built. Employment in trade was really significant in a small number of spas and employment in education was the best represented in big cities, in particular. Nevertheless, 73% of the towns had an industrial function classified in three subcategories: industrial specialized (9%), industrial complex and of services (60%) industrial jointed (4%), followed by the mixed-economy (20%), of services (6%) and agriculture (1%) (Pop, 1997). The share of industrial employment ranged from 25% to more than 80% - some small towns dominated by different industrial sectors (Fieni, Zărneşti, Azuga, Bălan) were dependent economically and socially on huge productive units. Only two of the 260 towns and cities in 1992 scored less than 25% of the total employment in industry (Insurăţei and Negru Vodă). In the category of industrial towns one can distinguish several subcategories, such as: complex industrial and services urban centres (the most numerous, 156 out of 189 in total) comprising usually the county seats, so the biggest towns and cities in terms of population at county level: Bucureşti, Tulcea, Alba Iulia, Călăraşi, Vaslui, Alexandria, Râmnicu Vâlcea. But the majority of the components is made up by medium-sized and small towns, such as: Abrud, Borşa, Adjud, Dej, Zalau, Gheorghieni, Rădăuţi. The most of them are dominated by only iunie 2005
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Jurnalul Economic one industrial sector or even by one huge industrial unit. The latter ones, the so called “company-towns” are extremely vulnerable because of their entire economic and social life is related to one economic activity (Vlahita, Balan, Bocsa, Brezoi, Bumbesti Jiu). The biggest cities in the country have a complex and diversified industry, usually being represented by Ploiesti, Pitesti, Craiova, Braila (in the south), Iasi, Bacau, Galati (in the east), Timisoara, Arad, Oradea, Baia Mare (in the west) and Cluj Napoca, Brasov, Sibiu, Targu Mures (in the central part of the country). The demographic size of these cities would have suggested a tertiary functional profile, but even Bucuresti despite its main administrative, cultural, political, social functions had 51% of its labour employed in industrial activities. The second subcategory is that of specialised industrial towns whose total employment is at least 75% concentrated in industrial activities. They were specialised in natural resources processing (Aninoasa, Petrila, Uricani, Vulcan, Rovinari, Balan, Ticleni), engineering (Bumbest Jiu), car industry (Mioveni), glass industry (Boldesti Scaeni), textile (Cisnadie and Buhusi), ferrous metallurgy (Calan) and non ferrous metallurgy (Copsa Mica), pulp and paper (Zarnesti). Very few towns are industrial mixed in which to the dominant industrial labour is added agrarian and tertiary employment. There are mainly small towns with less than 20,000 inhabitants with one or two industrial sectors: Talmaciu (wood and textile), Avrig (glassware), Nehoiu (wood and ready mades), Scornicesti (engineering, ready mades) and so on. The most interesting is that only two towns were classified as agrarian having more than 50% of the employment in agriAnul VIII, nr. 16
culture (Mihailesti and Insuratei), both small towns located in the south-eastern part of the Romanian Plain. Romania has one third of its territory represented by plains with very good climatic conditions and soil cover and only two small towns specialised in agricultural functions. Services towns accounted for 6% of the total number of towns and could be included in the subcategory of industrial and services type. They are represented by spas and resorts located along the Olt, Prahova, Cerna valleys and along the sea shore. They had different specialisations in trade, tourism, transport. There are some examples of towns that should have been included in the same category of services towns but because of the industrial development the tertiary sector is less important (Borsec, Vatra Dornei, Sovata, Buzias). About one fifth of the total number of towns consisted of mixed urban centres enjoying a balanced structure of employment. They were different in terms of population size, although the small and medium sized towns prevailed. They had almost equal agricultural, industrial and tertiary functions, playing a special territorial role and polarizing large rural areas. Some examples are Lipova, Tecuci, Videle, Ineu, Rupea, Campeni (Pop, 1997). A more detailed classification of industrial towns distinguished at the beginning of the 1990s 12 types of mining and manufacturing centres as compared with the national average profile. Almost 10% of the towns were specialized in metallurgy, having more than 60% of the industrial employees hired in this sector. Some examples are Calan, Zlatna, Vlahita, Campia Turzii, Otelu Rosu, Abrud, Hunedoara. Pulp and paper is another industrial sector that contributed iunie 2005
12 to the urban economy of some towns (Adjud, Busteni, Dej) dominated by big enterprises. About 45% of the towns were specialized in engineering (tools, machines, equipments) and some of them had more than 90% of the industrial labour force concentrated in one big company (Bals, Colibasi, Cugir, Bumbesti Jiu). In terms of population with only two exceptions, Ploiesti and Brasov, all the others belong to the small and medium-sized categories. Two subsectors of engineering, according to the national classification of economic activities, electrotechnical and mechanics, have also contributed to defining strictly specialized towns. The former was found in 14 cases, very different in population size, some very small (Fieni, Sacele, Titu, Filiasi) and some very large (Bucuresti, Timisoara, Craiova, Cluj Napoca). The latter generated industrial specialization in a number of small and medium-sized towns, such as Sinaia, Barlad, Ocna Sibiului. In the late 1960s and early 1970s, a major part of investments has been channeled to chemical industry. Huge chemical complexes used to concentrate important volumes of labour force in towns as Victoria, Marasesti, Navodari, Ocna Mures, Onesti, Fagaras. Ten towns were specialized in glassware, including some dating from the beginning of the industrial development (Azuga, Alesd, Avrig) and some others belonging to the socialist period (Dorohoi). Textile towns are also specific to early industrialization (Buhusi, Cisnadie, Talmaciu) as well as to later stages of socialist industrial development. In this case, the textile industry was used to balance the labor force market of towns specialized in heavy industry or to transform small agrarian centers into dynamic industrial towns. That Anul VIII, nr. 16
Jurnalul Economic way, new textile towns have emerged: Draganesti Olt, Darabani, Mihailesti, Isaccea, Siret). Located in the mountain and hilly areas, the industrial towns specialized in wood processing are mainly small towns (Intorsura Buzaului, Brezoi, Huedin, Deta, Pancota). Food industry enjoys the most dispersed spatial distribution and the least specialization level, dominating the small towns in agrarian, touristic or mining areas (Solca, Beresti, Macin, Ianca, Valea lui Mihai, Fetesti, Segarcea). Leather industry is dominant in the workforce structure of some small and medium-sized towns such as Dragasani, Targu Frumos, Agnita, Marghita. Finally, the last type of specialized industrial towns is represented by those whose local economy is dominated by the industry of building materials. Some towns registered above average shares of employment in this industry (Medgidia, Jimbolia, Bicaz, Comarnic). After 1990, the in-migration as the major source of urban growth has scored a dramatic fall. The towns, especially small and medium-sized, have gradually lost their attraction capacity for new comers. Their former industrial profile, limited capacity to diversify the local economy, the imbalances on the urban labour market, reduced entrepreneurship and attraction for foreign investments, lack of high order services are the main factors that influenced the “return to the village”. From huge disparities in early 1990s, the in-migration has almost equal values in urban and rural areas in 2003 whereas the out-migration is higher from towns and the main losers are the small and medium-sized towns. The predominant shifts of population are increasingly those from urban to rural and within the urban network. The rural to urban iunie 2005
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feature of the geographical pattern of population mobility (Tab. 1).
Table 1. Structure of urban and rural internal migration flows determined by permanent residence changing (rates per 1,000 inhabitants) 1992 Total 12.9 Rural to urban 9.4 Urban to urban 5.8 Rural to rural 6.3 Urban to rural 3.8
1993 10.6 6.9 5.0 5.7 4.4
1994 11.7 6.6 5.6 6.5 4.7
1995 12.8 5.9 6.1 7.8 5.8
1996 13.0 5.9 6.5 7.0 6.7
1997 13.4 5.6 6.1 7.6 7.9
1998 12.3 4.9 5.9 6.4 7.7
1999 12.3 4.7 6.0 5.9 8.3
2000 10.9 3.9 4.7 5.5 8.1
2001 12.7 5.7 6.4 5.6 7.8
2002 14.7 6.2 7.2 6.8 9.5
2003 15.3 6.6 7.8 6.3 9.8
Source: Statistical Yearbook of Romania, INS, different years. The functional classification of towns in 2003 looks very much different, especially because of the steady and important decline of industrial activities and workforce. A recent analysis (Popescu et al., 2005) showed that according to the employment breakdown the number of industrial towns have halved in the last ten years. Less than 40% of the total number of towns is still dominated by industrial activities but the degree of specialization has been diminished largely. There are still some small towns specialized in only one industrial sector: Ticleni, Cugir, Zarnesti, Mioveni, Copsa Mica). Many of the former industrial towns are now characterized by complex industrial and services functions. Almost an equal number of towns, as previously, represents the towns that have already shifted to tertiary sector. Although industry is far less important than before, many of the towns are dominated by one or two sectors, such as Petrila, Vulca, Lupeni (coal mining), Balan, Cavnic (extraction of non ferrous minerals), Mioveni, Plopeni, Bumbesti Jiu (engineering), Cisnadie, Talmaciu (textile). Only four county seats still joins this functional category in comparison with 39 (out of 41) in 1992, Anul VIII, nr. 16
the majority being now services and mixed towns. Specialized industrial towns have registered a dramatic fall, from 29 in 1992 to only one in 2003. One third of the total number of towns is now made up of services towns, five times more than in 1992. They are very different in population size, ranging from small ones to some of the biggest in the country. Thanks to the recent industrial decline, some of the small towns regained their normal functionality: for example towns located in important touristic areas turned from industry to services, or those situated in the middle of the plain region became agrarian once again. The mixed towns, whose labour force is almost equally distributed among agriculture, industry and services, increased in numbers, to about one third of the total. They comprise different towns in size and administrative role. In 1992 there were only two county seats scoring less than 50% employees in industrial activities, ten years later their number increased to 29. The on-going industrial restructuring will enhance the trends already obvious in the urban functionality and, probably, the agrarian, services and mixed towns will iunie 2005
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take the lead in the detriment of industrial towns. Recent developments The approaching date of accession to EU, in 2007, acts as an impetus for the urbanization process. Partially, in this light should be seen the recent urban developments and the emergence of new towns after 2000. The legal framework is represented by the law on national territorial planning updated in 2001. The provisions of the law settle down the demographic and economic criteria, the basic infrastructure a commune should have in order to be given the urban status. Additionally, location criteria are made clear: 25-30 km large areas lacking towns are privileged. This is an important progress in defining the basic requirements for the urban status in comparison with the period up to 1990. A study worked out in 2001 (Muntele, Iatu, 2001) reached interesting conclusions by comparing the employment structure of small towns and big villages. In fact, no significant differences were noticed, proving that in most of the cases, the urban status has been granted randomly. This is the case of older towns such as Nadlac, Segarcea, Beresti, Targu Bujor and newer such as those belonging to the last socialist industrialization wave in 1989 (Pogoanele, Mihailesti, Basarabi, Insuratei). Some of the most industrially specialized small towns registered less tertiary employment in comparison with some big villages (Copsa Mica, Aninoasa, Fieni). In exchange, there were 86 communes the same sectoral structure of employment as the average of the small towns, being located mainly in the outskirts of big cities. In Anul VIII, nr. 16
practice, most of the new towns, declared after 2000, do not meet both economic and location criteria. Only a small part of them are located in large rural areas, and at most a half is capable to polarize the neighbouring villages (Fig. 3). Basically, the new towns are the result of political decision-making process, as in the socialist period. Although the urbanization process is slowly progressing in terms of number, the content and the significance of urban civilization and urbanity are still to be built in the long run. Some of the recent studies raised questions related to the present features of the urbanization process. At least in the case of small towns located in the plain areas there is a significant return of the workforce to agricultural activities. This could be a normal trend but the increasing numbers of employees are recorded by the subsistence agriculture and there is a general degradation of social and economic life. This tendency of “urban ruralization” is one of the most negative impact of the transition period and should be tackled carefully. It is questionable if the quantitative urbanization is the main road to be followed or qualitative changes are needed in order to sustain the urban development. Generally speaking, towns are the engines of regional development, so urban imbalances could have a negative impact on territorial cohesion. This is felt at three different scales: at national level – a persistence of pronounced imbalances between the main metropolitan areas and the rest of the country in terms of economic development; at regional level – a widening or at least the maintenance of a number of territorial disparities beyond those measured by GDP and unemployment. In particular, economic development iunie 2005
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Jurnalul Economic is accompanied by growing congestion and social exclusion in the main urban areas whereas a number of rural areas are suffering from inadequate economic links with neighbouring small and medium-sized towns and their economies are often weakening as a result. Larger urban areas are tending to sprawl outwards encroaching into the surrounding country-side as economic activity is increasing and the living standard is rising, creating what have to
Anul VIII, nr. 16
be known as “rurban” areas. In the meantime, rural areas where there are no towns of any size in the neighbourhood, are experiencing falling population and a decline in the availability of basic services; within towns – the development of poverty pockets and social exclusion areas with often only limited availability of essential services, mainly in towns placed at the bottom of the urban hierarchy.
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Jurnalul Economic References:
Băcănaru, I., Cândea, M., Erdeli, G. (1976), Tendances territoriales et socioprofessionelles dans l'evolution de la population urbaine en Roumanie, RRGGG-Geographie, 20, p. 177-189. Cândea, M., Erdeli, G. (1981), Consideraţii geografice asupra spaţiului urban în România, SCGGG-Geografie, XXVIII, p. 49-57. Cucu, V., Bugă, D. (1980), Hierarchisation des centres urbains de Roumanie, RRGGG-Geographie, 24, p. 127-133. Cucu, V., Deică, P., Ungureanu, Al. (1984), Ierarhia social-economică şi tipologia funcţională a oraşelor, în Geografia României, II, Geografia umană şi economică, Ed. Academiei, Bucureşti, p. 164170. Iaţu, C. (2001), L'evolution demographique des villes de la Roumanie: 1992-2000, Analele Ştiinţifice ale Universităţii Al. I. Cuza Iaşi, XLVII, s. IIc, p. 6877. Mihăilescu, V. (1968), Une experience de geographie urbaine en Roumanie, Przeglad Geograficzny, XL, 4, p. 783-789. Mihăilescu, V., Herbst, C., Băcănaru, I. (1962), Consideraţii asupra criteriilor complexe de clasificare funcţională a oraşelor, Probleme de Geografie, IX, p. 35-45. Muntele, I., Iaţu, C. (2001), Quasivilles ou pseudo-villes – l'ambiguite de la petite ville en Roumanie, Analele Ştiinţifice ale Universităţii Al. I. Cuza Iaşi, XLVII, s. IIc, p.78-85. Anul VIII, nr. 16
Neguţ, S. (1994), Classification fonctionelle des villes de la Roumanie, in vol. Les nouvelles dimensions du changement urbain, Le IX-eme colloque franco-roumaine de geographie, p. 115123. (1997), Modelarea matematică în geografia umană, Ed. Ştiinţifică, 231 p. Pop, Gr. (1996), Potenţialul geografic în dezvoltarea urbanului în România, SUBB-Geographia, XLI, 1-2. - (1997), Funcţiile şi dimensiunile urbanului în România, SCG, XLIV, p. 921. Popescu, C. (2000), Industria României în secolul XX. Analiză geografică, Ed. Oscar Print, Bucureşti, 283 p. - (1990), L’impact du gigantisme industriel sur l’evolution des villes de Roumanie, RRGGG-Geographie, 35, p. 21-29. - (1996), Tipologia industrială a oraşelor României, Analele Univ. Timişoara, p. 33-43. Popescu, Claudia, Dumitrescu, Bianca, Damian, Nicoleta (2006), Schimbări recente în funcţionalitatea urbană a României, Comunicări de Geografie, X, in press. Şandru, I., Ungureanu, Al. (1967), Quelques traits geographiques de levolution des villes de Roumanie, Analele Ştiinţifice ale Universităţii Al. I. Cuza Iaşi, s. IIb, XIV, p. 135-144. Ungureanu, Al. (1980), Oraşele din Moldova. Studiu de geografie economică, Ed. Academiei, Bucureşti. Ungureanu, Al., Ianoş, I. (1996), Characteristic features of the urban system in Romania, RRG, 40, p. 3-13. iunie 2005
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mânia. Spaţiu, societate, mediu, Ed. Academiei, Bucureşti, p. 206-224.
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Polycentricity and the Eye of the Beholder. A Multi-Layered Analysis of Spatial Patterns in the Dutch Randstad Bart Lambregts, Robert Kloosterman & Merijn van der Werff
1. Introduction The Dutch Randstad1 can be seen as the quintessential polycentric region that, as a whole, functions as a global city.2 It combines a political capital, a financial capital, a cultural capital, a world port, a world airport, headquarters of important transnational companies (including banks and producer services) and a highly skilled, cosmopolitan labour force. These assets are however not located in just one city as in London or Paris but are distributed over a number of historically distinct cities that together comprise the Randstad. The region encompasses a small number of larger cities that are located in more or less close proximity (mainly within commuting distance) and that do not differ that much in terms of size. The different parts are independent political entities. At first glance, the Randstad seems to lack a clear dominant city as Amsterdam has only slightly more inhabitants than the next largest city 1
The urban micro region: Deva - Hunedoara Călan - Simeria 2 See Hall, 1966; Scott, 1998, Kloosterman and Musterd, 2001.
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Rotterdam, which has the largest port, and The Hague, which is the political capital. Within the polycentric region of the Randstad, locational differences, at first sight, seem to be eroded to the point of insignificance. Nearly every subcentre of this region has access to the same infrastructure (both transport and communication) and is, moreover, located within one-hour travel time of the international airport Schiphol. Also in socio-cultural terms, the urban centres of the Randstad appears to form one, fairly homogeneous urban field as the majority of the people (also) speak English, and the cable delivers CNN, BBC, France 2, TV5 (French) and WDR, ZDF, ARD (German) television almost anywhere. Within this large urban field, it would seem that more or less the same kind of agglomeration economies are at work (Phelps and Ozawa, 2003). Conceptualising the Randstad as one polycentric, global city region with approximately 6 million inhabitants, an advanced economic profile, and good international linkages puts this region, in principle, in the same league as the more established global cities of London, Paris or iunie 2005
20 New York. In this article, we will demonstrate, that notwithstanding its manifest polycentric character, the Dutch Randstad has just one (international) centre, which is located in Amsterdam. Polycentricity, we will argue, does not imply a uniform socioeconomic space but allows for marked spatial differentiation between urban milieux. More generally, polycentricity regarding the distribution of population and employment is compatible with a highly monocentric layout if we look at the location of typical global city activities. It seems that the internationally oriented control and command functions of the global economy are strongly dependent on highly localised agglomeration economies that articulate themselves on a much lower spatial scale than that of the polycentric urban region and, partly, even on a lower scale than that of the city itself, namely on that of specific parts of the city. Below, we will first present the more conventional polycentric picture of the Randstad by showing the nearly continuous spatial distribution of both population and employment (section 2). This representation of the Randstad as one urban field is highly in line with the views of many geographers, urban planners and policymakers and, to a high extent, also with the daily experience of many inhabitants of the Randstad who see traffic jams both into cities and out of them, and notice only very slight differences in built environment and amenities.3 We then change tack and unfold a rather different analytical perspective on the Randstad region by focusing on advanced international producer
Jurnalul Economic services and related aspects. By using new data, we are able to show that Amsterdam is the evident international centre within the polycentric region of the Randstad (section 3). We conclude by exploring the theoretical and the policy implications of our findings (section 4). 2. The Randstad as a polycentric urban region The Randstad is generally known as the horseshoe-shaped urban configuration in the western part of the Netherlands. It roughly runs from Dordrecht and Rotterdam in the south, via The Hague and Leiden in the west to Amsterdam in the north and Utrecht and Amersfoort in the east (Figure 1). This ring of cities surrounds a predominantly rural area called the ‘Green Heart’. The outer borders of the Randstad are not precisely defined, nor are they much discussed or disputed in Dutch planning and policy discourses.
3
See Lambregts and Zonneveld, 2004 for an overview of interpretations by geographers and planners of the Randstad concept.
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Zaanstad Haarlem
Almere Amsterdam
Haarlemmermeer Leiden
Amersfoort Green Heart
The Hague
Utrecht
Zoetermeer
Rotterdam Dordrecht 0
25
50
kilometres
Map 1: Overview of the Randstad The Randstad measures approximately 4,500 square kilometres (60 by 75 kilometres) and is home to about six million people. These live in a large number of mainly medium-sized cities and an even larger number of small towns and villages. The region includes twelve cities with more than 100,000 inhabitants and another ten in the range 70,000 – 100,000. The most populous cities are Amsterdam (736,000), Rotterdam (599,000), The Hague (458,000) and Utrecht (261,000).
The co-existence of so many individual smaller and larger cities in a relatively small area gives the Randstad its typical polycentric appearance. A simple population density map of the Netherlands confirms the image of the Randstad constituting a highly polycentric urban configuration. The map shows that it can even be thought to be part of a wider urban field that reaches out to country’s borders with Germany in the east and Belgium in the south (Figure 2).
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Population density per km2 (2002) 4.700 to 20.800 2.000 to 4.700 600 to 2.000 100 to 600 0 to 100
Map 2: Population density in the Netherlands This polycentric picture even stands firm if the spatial distribution of employment is taken into consideration. With some 3,000,000 jobs within its borders, most of them in various kinds of (advanced) services, the Randstad is without doubt the country’s principle economic Anul VIII, nr. 16
powerhouse. The port of Rotterdam is Europe’s most important point of entry and departure for goods transported over sea and Schiphol Airport, located just south of Amsterdam, is Europe’s fourth largest airport in terms of passenger movements (figures for 2003). A dense iunie 2005
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Jurnalul Economic network of road and railway corridors connects the cities of the Randstad with each other, with other parts of the country and with other metropolitan regions across North West Europe. The employment density map presented in Figure 3 suggests that the four largest urban agglomerations of the Randstad (Amsterdam, Rotterdam, The Hague and Utrecht) are well-matched in terms of economic importance. Recip-
rocity and equivalence between these cities are often illustrated by pointing at the complementary characteristics of the cities’ economic profiles. Amsterdam then forms the financial and cultural capital, The Hague the political and administrative centre, Rotterdam the main logistic centre and Utrecht stands out as the seat of many a consultancy firm.
Employment density per km2 (2002) 4.600 to 26.200 1.700 to 4.600 600 to 1.700 100 to 600 0 to 100
Map 3: Employment density in the Netherlands Anul VIII, nr. 16
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The current spatial features of the Randstad can be traced back far into history (‘t Hart, 1994) but they are – at least partly – also the result of almost half a century of careful spatial planning. Already in 1958, in a report called ‘The Development of the Western Netherlands’ (Werkcommissie Westen des Lands, 1958) the Randstad was conceptualised as a ring of towns and cities, separated by green spaces, situated around a larger rural area (the Green Heart). Opinions then varied as regards the desired future of this area: should it be encouraged, by allowing inward growth, to develop into a real metropolis in order to let economic agents benefit from the associated agglomeration economies or, alternatively, should all efforts be directed at preventing the area from becoming a real metropolis and keep the Netherlands free from much feared metropolitan sideeffects such as congestion and unhealthy living conditions (Lambregts & Zonneveld, 2004). Proponents of the latter view won the battle and the nation’s first national planning memorandum of 1960 prescribed that growth should be directed to other parts of the country to prevent the Randstad from ‘overheating’ and congesting (Ministerie van Volkshuisvesting en Bouwnijverheid, 1960). This ‘antimetropolitan’ attitude towards the Randstad persevered throughout the Sixties and Seventies and it was only in the Eighties – a decade of severe economic crisis and global economic restructuring – that new themes came to underpin Dutch spatial planning. Most of all this decade saw an increase of the attention for the country’s international competitive position and the possibilities for strengthening this position by means of spatial policy. International competition for (increasingly) mobile eco-
nomic resources was regarded less and less as something that took place between countries and more and more as a matter between heavily urbanised regions. As far as the Netherlands was concerned, Germany, Belgium, France and Great Britain were replaced as competitors by their metropolitan representatives such as the Rhine-Ruhr area, Frankfurt, the Flemish Diamond, Paris and London. The Dutch counterpart became the Randstad (see, for example, Ministerie van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer, 1991). After all, the international orientation of the business community was strongest here and the region was blessed with two of Europe’s most important transport intersections. The Dutch policymakers’ choice for the Randstad was confirmed by their foreign colleagues. Just as the Dutch had created foreign metropolitan competitors that were not, or scarcely, recognised or acknowledged as such in the foreign countries themselves (e.g. the Rhine-Ruhr area and the Flemish Diamond), the attention of the German and Flemish urban and rural planners was focused more on the competitive threat that emanated from the Dutch Randstad in its entirety rather than on the individual Dutch cities. Current policy views on the Randstad seem to take this course further. The latest Spatial Policy Document (the Nota Ruimte) continues to capitalise upon the polycentric nature of the region (Ministerie van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer et al., 2004). It presents the entire Randstad as the nation’s most important trump card in the international competitive struggle to attract and retain mobile economic resources and foreign investments. The central idea is that
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Jurnalul Economic an attractive, internationally competitive environment can only be realised at this particular spatial scale, that it requires the mass and diversity of the Randstad at large to play along with more established global cities and city-regions such as London, Paris and Frankfurt. In the remainder of this article we demonstrate that a more refined analysis of the region’s economic structure may lead to very different conclusions. 3. Global city functions and the Randstad Looking at the spatial distribution of the population and the employment, the Dutch Randstad thus forms a fairly uniform urban field with stronger concentrations in and around the historical cities. This section explores a different analytical perspective on the Randstad, specifically focused on the identification of the place(s) where typical global city activities are located. The global economy is partly flows and partly nodes as the flows have to start and land somewhere. Global cities constitute these nodes where rich bundles of global flows—goods, services, capital, information, people—are co-ordinated, allocated, generated, initiated, transformed or transferred. Together these nodes form the backbone of the global economy (cf. Friedmann, 2001). Below, we will show that the Randstad’s global city functions are spatially articulated in a highly monocentric pattern, contrary to the classic image of the Randstad as a large, fairly homogenous urban region with relatively little differentiation. Saskia Sassen (2001a, 2001b) has analysed the particular characteristics of Anul VIII, nr. 16
the global cities over the last three decades. In her view, global cities are intimately and inherently linked with advanced producer services. With globalisation, economic activities become more dispersed and coordination tasks, concomitantly, become more complex. An increasing part of these central control and co-ordination functions are outsourced to producer services. Specialised producer services fulfil these tasks on a global scale and these firms themselves have branched out on a global scale contributing to a further strengthening of the global network of nodes (Hall, 2001). In addition, these producer services are subject to strong agglomeration economies (Amin and Thrift, 1992). They are, of course, dependent on a highly skilled labour pool, on sophisticated infrastructural facilities for (global) communication and transport, on other producer services for outsourcing on their part and, crucially, they thrive on thick, non-standardised information that has to be exchanged in face-to-face situations (and is even created in such exchanges).4 Agglomeration and, hence, proximity characterise advanced producer services. Agglomeration based on economic reasoning is strengthened by agglomeration based more on social reasoning. Increasingly it has also become clear that the workers of these producer services—among them many highly skilled creative people—are quite selective when it comes to the milieu they have to work in 4
According to Sassen (2001a): “This is a type of information loop that as of now still cannot be replicated fully in electronic space, and has as one of its value-added features the fact of unforeseen and unplanned mixes of information, expertise and talent, which can produce a higher order of information.”
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26 (and live in or nearby on commuting distance). They demand a certain quality of place and this refers to both cultural amenities (museums, cafés, restaurants, galleries, nightclubs etc.) and a tolerant and open cultural atmosphere (Zukin, 1995, Florida, 2002). These requirements contribute to spatial concentration of producer services in particular (localisation economies) and to agglomeration more in general (urbanisation economies). To explore the spatial patterns of advanced producer services empirically, we build upon the sophisticated methodology that is used in the GaWC global cities programme (see Beaverstock et al, 2000). In addition, we have used one other indicator that can give information on the more precise location of the global functions in the Randstad. This indicator is the spatial distribution of escort services in the Netherlands. Such services are part-and-parcel of the high-end amenities of global cities catering predominantly for more well to do clients from abroad and from the area itself. Before we show the results of this exploration, we first explain the particular methodology used for identifying the locations of producer services. We started with assessing around one hundred globally operating commercial service providers as to whether they are established in the Netherlands, and if so where. A great deal can be learned from the establishment strategies of such companies. Because setting up an office abroad is an expensive business for a company, one might assume that a lot of careful consideration goes into choosing a location. The company will only establish offices or outlets in those places, which it considers to be crucial for the realisation of its objecAnul VIII, nr. 16
Jurnalul Economic tives (Beaverstock et al, 2000). The locational preferences of such businesses therefore say something about the importance that is or is not attributed to certain locations from an international business perspective. We used a database of companies created by the British Globalization and World Cities Study Group and Network (GaWC) for their research into network relationships between world cities (see Taylor et al, 2002). The database contains information on 97 globally operating companies from six commercial services sectors. The six sectors are management consultancy, financial services, accountancy, legal services, insurance and advertising. These are sectors within which the GaWC researchers were able to trace at least ten globally operating businesses. In order to qualify as a global business, a company had to have branches in at least 15 different cities, with at least one branch in North America, Europe and/or the Pacific region of Asia. The database consists primarily of (originally) American, British and Japanese companies. A limited number has their roots in the Netherlands (including ABNAMRO, ING and the Rabobank). An assessment was made with regard to these 97 companies as to whether 1) they have a presence in the Netherlands and 2) where exactly their Dutch head offices are located. In order to establish this, a variety of Internet sources were consulted including the websites of the companies themselves, the Yellow Pages and the telephone directory. As regards the companies that turned out to have more than one office in the Netherlands, only the Dutch principal establishment, as designated by the companies themselves, was iunie 2005
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Jurnalul Economic included in the analysis. In order to place the pattern ascertained in perspective, the six service sectors were also analysed from a wider perspective. This involved examining the distribution of the total number of branches, the employment possibilities and the location quotients in these sectors. Of the 97 businesses, 78 have a branch in the Netherlands (see Table 1). Apparently, the majority of these ‘global players’ consider it important to be active on the Dutch market. However, the presence score differs considerably per sector. For example, all accountancy firms included in the original database have one or more offices in the Netherlands whereas designated.
the same applies to not even half of the selected law firms. The latter may have to do with the relatively modest size of the Dutch market and the very specific (almost completely in Dutch and therefore difficult to access for foreigners) knowledge that is required to provide legal services within a country. The Randstad appears to be favourite with most of these business service providers. All but two of these companies control their Dutch operations from within the Randstad. For three companies with more than one office in the country no clear head office could be
Table 1: Globally operating commercial service providers in the Netherlands (situation in April 2004) Head offices in the Presence GaWC ‘Top 97’ in the Netherlands Randstad Number of comSector Number of companies Number of companies panies Accountancy 17 17 14 Financial services 22 17 17 Insurance 10 8 8 Legal services 16 7 6 Management consultancy17 15 14 Advertising 15 14 14 Total 97 78 73 Source: Calculated by authors on the basis of websites of companies. Seen in this way, the Randstad clearly seems to function as a global region. However, this view needs to be adjusted if we focus on the spatial distribution of head offices within the Randstad. It actually appears that no fewer than almost three quarters (54 from 73) of the companies investigated have their main Dutch office in Amsterdam or in one of the surAnul VIII, nr. 16
rounding municipalities. Figure 4 shows that the number of establishments in Amsterdam far exceeds the rest of the Randstad. Amstelveen, adjacent to Amsterdam, follows at some distance and this municipality is then followed by Rotterdam and Utrecht. In the financial services, the advertising and the legal services sectors, there is almost absolute dominance of the iunie 2005
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Amsterdam region. In accountancy, management consultancy and the insurance sector, cities such as Rotterdam and Utrecht and their surrounding municipalities share a piece of the pie. What is strik-
ing is the complete absence of The Hague. Not one of the selected global service providers has selected the seat of the national government as its Dutch bridgehead.
Amsterdam Amstelveen Haarlemmermeer Utrecht Rotterdam Head offices of GaWC 100 Global Service Providers in the Netherlands 40 20 4 Advertising Finance Insurance Accountancy Legal services Management Consultancy
Map 4: Distribution of Dutch head offices of global service providers
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The question is whether the aboveobserved concentration in the Amsterdam region is an indicator of a more general pattern. The fact is that the commercial services sector is, in any event, very strongly represented in the northern part of the Randstad. Figure 5 shows the location quotients for the six different services sectors5. The six services sectors are significantly over-represented (location quotient greater than 1.75) in quite a number of cities and municipalities in the northern
over-represented in the Amsterdam region, while management consultancy is substantially over-represented in the region of ’t Gooi and large areas of the province of Utrecht. In addition, there is considerable over-representation of the legal services and insurance sectors typically in the largest four cities (Amsterdam, Rotterdam, The Hague and Utrecht). Map 5: Location quotients business services Location Quotients Selected Business Service Sectors LQ > 2 LQ = 1,25 to 2 LQ = 0,8 to 1,25 LQ = 0,5 to 0,8 LQ < 0,5
part of the Randstad. The financial services and advertising sectors are significantly 5 The location quotient method compares the local employment share of a particular industry to the national share of that industry
The structural characteristics of the Amsterdam local and regional economy and the geographic distribution of the head offices of the selected business service
30 firms therefore point very much in the same direction. However, the former cannot completely explain the latter. Whereas in terms of employment and the number of establishments in the six sectors together Amsterdam scores two to four times higher than Rotterdam, The Hague or Utrecht (see Table 2), in the case of the selection of world players, the relationship is even ten to one. Other factors must, therefore, be at work to make that the Amsterdam region stands out at international level compared to the rest of the Randstad. Only in Amsterdam do we find the global city milieu with the dense concentration of international advanced producer services. The agglomeration econo-
Jurnalul Economic mies that Saskia Sassen referred to are clearly at work here. In addition, Amsterdam stands out because of its other qualities as the cultural capital of the Netherlands (Kloosterman, 2004), as a very open cosmopolitan city and because of its qualities of place more generally (Trip, 2005). Looking solely at global city functions generates a highly monocentric picture with Amsterdam as the clear centre. Other cities in the Randstad may also be in close proximity to Schiphol and boast comparable facilities in terms of accessibility, but a truly international milieu that can support global city functions is only be found in Amsterdam.
Table 2: Commercial services* in the G4, 2002 Establishments Employment** From the GaWC ‘top 97’ Number Share Number Share Number Share Amsterdam 9,669 69% 56,015 48% 41 84% Rotterdam 1,433 10% 25,060 21% 5 10% Den Haag 1,115 8% 15,312 13% 0 0% Utrecht 1,855 13% 21,380 18% 3 6% Total 14,072 100% 117,767 100% 49 100% * Reduced to the six sectors focused on in this article, namely financial services, insurance, accountancy, legal services, management consultancy and advertising. ** Only full-time, not part-time. Source: LISA register of establishments 2002. The GaWC selection of business services is inevitably arbitrary. In our research project, we are also trying to capture the spatial differentiation within the Randstad by using other indicators. Elsewhere, cultural industries were used as indicators of differences in urban milieus (Kloosterman, 2004). Below, we use another, somewhat unconventional, indicator to underline the central role of Amsterdam within the Randstad. We have used anAnul VIII, nr. 16
other high-end service activity that is a part of the fabric of global cities, namely escort services. The oldest profession in the world can take on many forms and shapes, but our contention is that escort services can be seen as the expensive segment catering for both local and foreign persons (Cameron, 2004). Part of the demand for escort services is related to doing business (e.g. closing a business deal) and can, therefore, actually be seen as another proiunie 2005
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Jurnalul Economic ducer service (though one might have a very different normative appreciation of this particular activity). We expect, therefore, that the spatial distribution of this particular service activity is related to specific urban milieus that are characterised by the presence of high-earners and the clos-
ing of frequent business deals. Map 6 shows the distribution of firms providing escort services in the Netherlands. Again, we find a highly monocentric pattern with Amsterdam towering over the other Randstad cities. 5. Conclusions
Our analysis shows that the polycentric character of the Randstad evapoNumber of Escort Services (2004, listed in the Yellow Pages) rates when one delves below the general maps of the distribution of population and 50 employment. By looking at the distribution 25 of advanced producer services, Amsterdam 5 comes out Groningen as the centre of global functions within the Randstad. It is there where the cumulative agglomeration forces of advanced business services are at work contributing to creating a global milieu that, in its turn, attracts other international activities. Amsterdam is the global node or Haarlem Amsterdam gateway within the larger polycentric setting of the Randstad. Below the level of Leiden Enschede the polycentric region of the Randstad, agglomeration economies are to be reaped at 's-Gravenhage the level of an individual city and, arguaRotterdam bly—although this is still a research quesNijmegen tion—even at the lower level of a particular area of the city. These agglomeration forces are apparently very sticky and highly localised. Our view that locational differEindhoven ences do matter in the Randstad is further supported by the results of a recently performed analysis of the office strategies of advanced business service providers in the region. The findings point out that many such firms find it necessary to have an office in at least two and quite often in even all of the four largest cities in the RandMap 6: Distribution of escort serstad, suggesting that they consider it not vices feasible to serve the entire Randstad from Anul VIII, nr. 16
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32 a single, strategically located office (Lambregts, Van der Werff & Kloosterman, 2004). Apparently, the four largest cities constitute ‘business markets’ of their own; defined by their own set of localised agglomeration economies and difficultly accessed from the outside. In a sense, then Amsterdam, or a part of Amsterdam on the southern rim (the Zuidas area) is the central business district of the global city region of the Randstad. It is there where a wide spectrum of global linkages makes their landfall. For Amsterdam, this situation is anything but new. From about the end of the 16th century into the 18th century, Amsterdam was not just one global city but the global city co-ordinating flows of goods, services and capital across much of the globe. Then as now, the activities connected to the global node function were highly spatially concentrated (Lesger, 2001). Notwithstanding, the advances in ICT and transport close physical proximity remain a prerequisite for maintaining intensive global links. The example of Amsterdam also shows that it might be the case that these specific agglomeration economies can be reproduced over a very long time through the presence of key firms (e.g. banks), key institutions (educational facilities), key infrastructure (both transport and communication) and an open cosmopolitan atmosphere. The monocentric picture of the global region the Randstad is at loggerheads with the standing policy practice of promoting the entire Randstad as the country’s most important trump card as regards international competition. It begs the question of whether it might not be more effective, as far as international proAnul VIII, nr. 16
Jurnalul Economic filing is concerned, to continue building on the qualities and image which the Amsterdam region apparently already has. On a more general level this article has shown that the study of polycentric spatial patterns is a complex business. Regions that appear highly polycentric in terms of population or employment distribution may as well show strong indications for ‘monocentricity’ when different, more restrictive measures are used. Even a quintessential polycentric urban region as the Randstad is, at second glance, home to just one, global node that offers the right conditions for global service providers to feel at home. Polycentricity, hence, is up to certain extent in the eye of the beholder. Indicators that suggest that the Randstad is ‘polycentric’ have to be weighed against others that show that the Randstad is not polycentric at all. Further studies of polycentric urban regions should therefore aim to lay bare the multi-layered complexity of which such regions consist. Only in this way will we (as geographers and planners) be able to get a better grasp of what polycentricity, both as an analytical concept and as a key feature of many contemporary urban regions, really amounts to, and also only in this way will we be able to help spatial policymakers in their efforts to make the best of the opportunities offered by such regions. References: Amin, A. & N. Thrift (1992), ‘Neomarshallian nodes in global networks’. International Journal of Urban and Regional Research, 16: 571-587. Beaverstock J.V., Smith R.G., Taylor P.J. (2000) World city network: A new iunie 2005
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Jurnalul Economic metageography? Annals of the Association of American Geographers, 90 (1), pp. 123134. Cameron, S. (2004), ‘Space, Risk and Opportunity: The Evolution of Paid Sex Markets’, Urban Studies, 41(9): 1643– 1657. Florida, Richard (2002), The Rise of the Creative Class; and How It’s Transforming Work, Leisure, Community and Everyday Life. New York: Basic Books Friedmann, J. (2001) Intercity Networks in a Globalizing Era. In: A.J. Scott (ed.) (2001) Global City-Regions: Trends, Theory, Policy. New York: Oxford University Press, pp.119-138. Hall, P. (1966) The World Cities, London: Weidenfeld and Nicolson. Hall, P. (2001) Global City-Regions in the Twenty-first Century. In: A.J. Scott (ed.) (2001) Global City-Regions: Trends, Theory, Policy. New York: Oxford University Press, pp.59-77. Hart, M. ’t (1994) Intercity Rivalries and the Making of the Dutch State, in: C. Tilly and W.P. Blockmans (eds.), Cities and the Rise of States in Europe, A.D. 1000 to 1800, Boulder/San Francisco/Oxford: Westview Press, pp. 196-217. Held, D., A. McGrew, D. Goldblatt and J. Perraton (1999), Global Transformations; Politics, Economics and Culture. Cambridge: Polity Press. Kloosterman, R. (2004), ‘Recent employment trends in the cultural industries in Amsterdam, Rotterdam, The Hague and Utrecht; a first exploration’, (Tijdschrift voor Economische en Sociale Geografie, 95:2. Kloosterman, R. and S. Musterd (2001), ‘Polycentric urban region as a reAnul VIII, nr. 16
search concept’, Urban Studies, 2001 38(4): 619-629. Lambregts, B., M. van der Werff & R. Kloosterman (2004) Quantitative analysis of business service connections in the Randstad. Working paper produced within the framework of the POLYNET project. Lambregts, B. and W. Zonneveld (2004), ‘From Randstad to Deltametropolis: Changing attitudes towards the scattered metropolis’, European Planning Studies 12 (3): 299-321. Lesger, C. (2001), Handel in Amsterdam ten tijde van de Opstand; Kooplieden, commerciële expansie en verandering in de ruimtelijke economie van de Nederlanden ca. 1550-ca. 1630. Hilversum: Verloren Ministerie van Volkshuisvesting en Bouwnijverheid [Ministry of Housing and Building Industry] (1960) Nota inzake de ruimtelijke ordening in Nederland [Report on spatial planning in the Netherlands], The Hague: Staatsuitgeverij. Ministerie van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer [Ministry of Housing, Spatial Planning and the Environment] (1991) Nadere Uitwerking Randstad Internationaal. Eenheid in verscheidenheid. Rapportage van de Stuurgroep [Further Elaboration Randstad International], The Hague: Ministry of Housing, Spatial Planning and the Environment. Ministerie van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer [Ministry of Housing, Spatial Planning and the Environment] et al (2004) Nota Ruimte: Ruimte voor Ontwikkeling. The Hague: Ministry of Housing, Spatial Planning and the Environment. iunie 2005
34 Phelps, N. & T. Ozawa (2003), ‘Contrasts in agglomeration: protoindustrial, industrial and post-industrial forms compared’, Progress in Human Geography, 27(5): 583-604. Sassen, S. (2001a), The Global City; New York, London, Tokyo (Second Edition). Princeton/London: Princeton University Press. Sassen, S. (2001b), ‘Global cities and global city regions: a comparison’, in: A. Scott (ed.), Global City-Regions; Trends, Theory, Policy, Oxford: Oxford University Press: 78-95. Scott, A. (1998), The Regions and the World Economy. Oxford: Oxford University Press. Taylor, P., G. Catalano & N. Gane (2002) ‘A geography of global Change: Cit-
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Jurnalul Economic ies and Services 2000-01’, GaWC Research Bulletin 77, University of Loughborough, Department of Geography, Loughborough (available on the web: http://www.lboro.ac.uk/gawc/rb/rb77.ht ml) Trip, J.J. (2005), ‘Multiple land use as a means to increase quality of place in railway station areas’, Journal of Housing and the Built Environment Werkcommissie Westen des Lands (1958) De Ontwikkeling van het Westen des Lands: Rapport [The Development of the Western Netherlands: Report], The Hague: Staatsuitgeverij. Zukin, S. (1995), The Cultures of Cities. Oxford: Blackwell Publishers.
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Landscape Changes in the Valley of the Danube as a Result of Human Activities Impact Prof. Gheorghe Vlasceanu, PhD Assist. Prof. Aurel-Cristian Ches, PhD candidate Academy of Economic Studies, Faculty of International Business and Economics – Bucharest Danube’s floodplain is one of the regions in Romania that have undergone some of the most dramatic changes in the last 100 years, as it was transformed for agricultural purposes only to be later restored to its natural state, as the losses proved to be greater than the benefits. This region is considered one of the world’s most important ecoregions. However, in the XX-th century Danube’s natural system was affected by human activities. Great resources meant great opportunities for exploitation. Dams were built and large areas were drained for agricultural purposes and flood protection. Thus, much of Danube’ wetlands, floodplains and floodplain forests were destroyed. The increasing pressure of human activities and unsustainable agricultural practices didn’t prove to be cost-effective, and benefits were outrun by losses. Economical and environmental costs showed that action had to be taken. Therefore, in 2000, it was signed the declaration that created the Lower Danube Green Corridor, Europe's largest cross border wetlands protection and restoration area. Keywords: floodplain, human activities, environmental assessment, restoration Romanian Plain Romanian Plain, the largest plain of Romania, is located in the south of the country, is bordered to the west, south and east by the Danube river, and to the north by the higher plateaus and Subcarpathians. The slope of the landform descends slightly from the north to the south and from the west to the east, towards the valley of the Danube. The relief has a relatively plane surface, with a thick layer of loess (which reaches an extension of 10 to 45 meters), developed terraces and rivers with wide Anul VIII, nr. 16
floodplains. The slight declivity is also reflected by the large meanders of the rivers. The evolution of the loess layer determined the formation of V-shaped valleys or even gorges, and it also determined the great depth of the water tables location, a reason for which most of settlements are located in the valleys, along the contact line with the floodplains or the terraces base. The existing geomorphologic processes, specific for a plain, are those characteristic for loess formation. The lack of effective drainage has usually caused significant damage to the crops. iunie 2005
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As a particular landform, Danube’s floodplain stands out, as a low alluvial plain, with an extension of 1 to 6 km, even up to 25 km in the Large Island of Braila. Much of this floodplain has been transformed for agriculture, by dam construction and drainage. Natural lakes, especially floodplain lakes, numerous in the past, had consequently disappeared. Only a few remained. Among them, some lakes can be mentioned: Bugeac Lake, Oltina Lake, Vederoasa Lake, Baciu Lake, Hazarlic Lake, Turcoaia Lake, Jijila Lake, Suhaia Lake, Fistoveanca Lake, Radulea Lake, Chircanu Lake. Valley of the Lower Danube The Danube basin covers 817,000 km and is the most international river basin in the world, extending over all or part of the territories of 18 countries. The Danube River flows across ten countries and four capitals and is Europe’s second longest river after the Volga, flowing over 2,857 km from Germany’s Black Forest to the Romanian Danube Delta on the shores of the Black Sea. The Danube is also Europe’s only major river that flows west to east. It has played a vital role in the economic and cultural development of the continent. The European Commission recognizes the Danube as the “single most important non-oceanic body of water in Europe” and a “future central axis for the European Union”. Danube is the most important axis of naval transport in Europe. As result of the completion of Danube – Main – Rhein channel, it was created a waterway which links the Black Sea to the North Sea. 2
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Danube has played an important role in Romania’s history, culture and economy. 38 percents of its length and half of its navigable part including its mouths are situated on the territory of Romania. Its resources and its economical, political and social importance made it a densely populated area from ancient times. Along its length there are 220 localities, out of which 22 are towns. The archaeological proofs show that some of the present towns are known from the times of Roman Empire, that is 2000 years ago. Orsova (Dierna), Drobeta Turnu-Severin (Drobeta), Turnu Magurele (Turris), Cernavoda (Axiopolis), Harsova (Carsium), Isaccea (Noviodunum), Tulcea (Aegyssus). The population growth and the appearance of new towns continued through the Middle Ages to the present day. Nowadays, Romanians towns located on the banks of the Danube according to its flowing direction are: Moldova Noua, Orsova, DrobetaTurnu Severin, Calafat, Corabia, Turnu Magurele, Zimnicea, Giurgiu, Oltenita, Calarasi, Fetesti, Cernavoda, Harsova, Macin, Braila, Galati, Isacccea, Tulcea, Sulina. There are bridges across the Danube at: Giurgiu, Fetesti- Cernavoda, and Giurgeni – Vadu Oii. These towns and cities play a major role as fluvial ports. The settlements located along the Danube have a well developed industrial role, some of them being among the leading industrial centres of the country
Danube’s Sectors: On the Romanian territory, nube’s course can be divided in four tors: Bazias – Drobeta Turnu-Severin tor, Drobeta Turnu-Severin – Calarasi iunie 2005
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Jurnalul Economic tor, Calarasi – Braila sector, Braila – The Black Sea sector (the maritime sector). Bazias – Drobeta Turnu-Severin sector, is also known as Danube Gorge (the longest transversal valley in Europe, with a total length of 144 km). This sector varies in width from a few hundred meters to 5 km. Before the construction of the Iron Gates hydroelectric and navigation system (between 1970 and 1972), this sector was characterized by a steep slope, high speed of water, whirlpools and rocks on the river bed, some of them visible at low water level. The construction of the Iron Gates Hydroelectric plant and navigation system (the second largest plant in Europe, with an installed power of 2100 MW), lead to a rise of the water level and consequently for some of the settlements a new location had to be found, as it was the case of the town of Orsova. Drobeta Turnu-Severin – Calarasi sector, is Danube’s sector which is situated in the south of Romanian Plain. This sector is characterized by low banks and a wide floodplain. Due to Danube’s great width, the waterspeed slows, and favours the formation of the alluvium deposits and islands. In the past, in Danube’s floodplain there were large lakes linked to the river by secondary arms; these floodplain lakes have been dammed and drained, as it was the case of Lake Greaca, the largest, while some of them have also undergone a planning program (for example Lake Bistret and Lake Suhaia). Unlike the northern bank, which is low and has a well-developed floodplain, the southern Bulgarian bank of Danube is high and has no floodplain. Anul VIII, nr. 16
Calarasi – Braila sector (known in the past as Danube’s ponds), is the third sector from upstream to downstream. The Danube divides two times into two arms, which form a giant island up to 25 km wide, which represent the widest sector of Danube’s floodplain. These regions, formerly flooded, covered with ponds, marshes, lakes and forests are nowadays dammed, drained, and transformed into agricultural land (Braila’s Great Island, Ialomita’s Pond). Due to the mild climate, the largest sector of Romanian Danube’s floodplain was used in the past by the shepherds who climbed down the Carpathian Mountains as a place to spend the winter. Braila – The Black Sea sector is also known as the „Maritime Danube”, as its depth allows access for sea-going ships and ocean liners, along the rectified and dredged Sulina arm. Between Braila and Ceatal Izmail, the Danube flows through a single arm, and beyond that point the river divides into three arms: Chilia, Sulina and St. George which enclose the Danube Delta. Danube Delta The Danube basin is home to a wide variety of natural habitats. Among these are the Lower Danube floodplains and islands and the large lakes, reed beds and marshes of the Danube Delta. These habitats are home to a rich and in many cases unique biodiversity, which includes more than 100 different species of fish, and among them six endangered species of sturgeon. The 600,000 ha Danube Delta has been designated as a World Heritage Site, iunie 2005
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UNESCO Biosphere Reserve and Ramsar Site. It is the habitat of more than 280 bird species, including 70 per cent of the world’s population of white pelicans and 50 percent of the pygmy cormorant population. Danube Delta is the largest compact reed bed in the world, with a total surface of 115.000 ha covered by reed. Between its three arms, there is a unique mixture of canals, reed beds, marshes, lakes and ponds. Climate The Romanian Plain and the Danube Valley are situated in terms of latitude at mid-way between the Equator and the North Pole and are characterized by a temperate climate, with four distinct seasons. The western part of the Romanian Plain has a continental temperate climate with sub Mediterranean climatic influences, characterized by rainy autumns and mild winters. Romanian Plain central part has a climate of transition from the oceanic and sub Mediterranean influences of the west to the more arid climate in the east. The quantity of precipitation also decreases from west to east. Baragan has a drier temperate climate, with eastEuropean aridity influences, with very cold winters and hot summers, with frequent droughts. As concerns the Danube Floodplain, the evaporation along the river and the watershed level – close to the soil surface, causes a high level of humidity that determines moderate temperatures and fewer tropical days. The average annual temperature reaches 10-11°C, while in the Danube Floodplain the average annual temperature Anul VIII, nr. 16
has the highest values in the country, that is >11°C. July average temperature reaches 22-23°C, while in January the temperature drops to -3°C. Average annual precipitation reaches 500-600 mm in the western and central part of Romanian Plain, 400500 mm in the Baragan, and at the mouths of Olt and Jiu rivers. Danube Delta reaches less than 400 mm of precipitation annually. The largest quantity of precipitation falls from May to July in form of showers. The wind which blows from South and Southeast, also known as the „Austru”, affects the crops in the fields, because is a very hot and dry wind, which causes drought. During the winter, the dominant wind is the „Crivat”. The effects of the winds are moderated by the Danube’s floodplain shelter role. The large variations recorded by the atmospheric circulation determine strong fluctuations of the average annual precipitation quantity and pattern. As a consequence, droughts occur at irregular intervals in Romania, and affect mostly the South-East and Danube floodplain regions. Romania’s drought affected regions, Dobrogea and the eastern half of Romanian Plain, represent at the same time the main Romanian agricultural region. The soils in this territory are affected by different processes of degradation. As inappropriate agricultural techniques are still being used, much of this zone’s soils are affected by a decrease in the contents of humus and nutrients and by degradation because of compactness and crust formation. In the last few years, in the southern region of Romania has been observed a substantial reduction of the soil’s water reiunie 2005
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Jurnalul Economic serves due to prolonged droughts. The main problem that occurs in the drought affected regions is that of adopting managerial policy adapted to the drought scenarios, in order to make sure that measures are being taken: short-term measures (compensation of humidity deficit through irrigations, culture rotation, fertilization, adaptative agricultural techniques) and medium and long term measures (assuring water levels in reservoirs, creating tree lines for protection). Droughts usually occur in September, March, April, and sometimes in June. Yet, the humidity deficit in the soil’s and plants’ water necessity reaches a maximum point during summer months when the high temperature increases the evaporation process. All these characteristics prove the need for irrigation. For this purpose, Danube’s water is used for the SadovaCorabia, Giurgiu-Razmiresti, GalatuiCalarasi, Pietroiu-Stefan cel Mare, Terasa Brailei and Carasu irigation systems. From a total of 14.8 million hectares of agricultural land, in Romania the drought occurs on approximately 7,1 million hectares, which also include most of the 3,2 million hectares planned for irrigation. According to the data provided by the ministry of Water, Agriculture and Forest and The Romanian Statistics Yearbook, from 1980 there has been an increase of irrigated land surface, while between 1990 and 1999, the irrigated land surface decreased from 62.5 % to 9.4 % of the entire irrigation planned surface. In 2001, 400.000 ha were irrigated, while in 2002, only 200.000 ha (6.2 %) were still irrigated. Anul VIII, nr. 16
At present, there is a government plan which stipulates that the irrigation system must be rehabilitated by the year 2010. Soil salinization occurs on approximately 0.6 million ha, with some intensifying tendency on the irrigated or inappropriately used lands, or in areas with a salinization potential, which total another 0.6 million ha. Direct economic losses to the crops because of the mentioned restrictions are estimated at 20 percents per year. Flora In the past, most of this region was covered by forests, a thing which is also revealed by the toponymy of some places. Thus, the name of “Teleorman” county comes from the Turkish words “deli”crazy and “orman”- forest/woods, which indicates the former great expansion of the forested areas in this region. The eastern part of the Romanian plain has natural steppe vegetation, while for the central and western part, the characteristic is given by a blend of steppe and forest. Among the different species found in this area, there are: oak, lime, ash, elm, hornbeam. The shrub includes numerous species: may, sloe, wild rose, privet, common elder, cornel, hazel. The high impact of human activities reduced the original natural vegetation to some islands, much of it being replaced by agricultural land. The same phenomenon is found in the Danube Delta whose natural vegetation is represented by water plants and large surfaces covered with reed, and by iunie 2005
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the characteristic floodplain vegetation, with forests of willows, alder and poplar. Fauna On the low altitude plain region live a wide variety of rodents (hare, ground squirrel, field mouse) and birds (lark, quail, partridge). In the forested areas live wild boars, deer, wolves, and foxes. This region is also known for its high-density of pheasants, most of them brought here by colonization, and also for the sporadic presence of protected species, such as two species of bustard. Danube’s floodplain’s fauna is represented mostly by the great number of species of birds, especially water birds, along with a rich variety of species of fish, most of them with economic value. The most valuable in this respect are the sturgeons, well-known for their caviar. Socio-Economic Importance The main economic uses of the Danube are: navigation/transport hydro-electric potential domestic/drinking water supply water supply for industry water supply for agriculture fish resources, including sturgeons (best known for caviar production) agricultural land and pastures in Danube’s floodplains and in the Danube Delta tourism and recreation waste disposal reed used in paper industry sand and gravel for construction Anul VIII, nr. 16
In addition, the Danube’s remaining floodplains provide a range of economically important ‘ecological services’, such as water quality regulation and flood control. Danube’s Floodplain
Lower Danube River and its floodplains and wetlands are a unique natural area whose economical, ecological and scientific significance is of international importance. The floodplains of the Lower Danube are areas with outstanding biodiversity, providing multiple functions and benefits such as: biodiversity conservation, water purification, pollution reduction, flood protection and support for socioeconomic opportunities such as fishery and tourism. Floodplains and wetlands have a great importance in the maintenance of water quality and environmental health in the Danube River and Black Sea and offer a basis for creating economic development opportunities for local populations (fish harvesting, tourism etc). Until the end of the 19th century, the Danube was a largely natural system with an extensive network of channels, oxbows, backwaters, marshland, floodplain forests and meadows. The river was characterized by constant changes in its course and dynamic natural exchanges with its floodplains. Since then, human interventions in the way of flood protection, agriculture, electricity production and navigation have destroyed over 80 percents of the Danube’s wetlands, floodplains and floodplain forests. That led to great losses in terms of habitats and wildlife. One exiunie 2005
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Jurnalul Economic ample is the considerable reduction of nursery areas for spawning fish and the blocking of migratory pathways for commercially important species such as sturgeon, which now survive only as small remnant populations. Changes in discharge volume and speed, water quality, and alluvium volume as a result of river regulation and pollution have also had negative impacts on biodiversity. Such developments have altered the river, affecting wildlife and the food, water and raw materials resources. The fertility of the lands of the Danube’s floodplain determined seasonal cultivation, once the water retreated. The good crops which were obtained encouraged the expansion of the cultivated land. On the other hand, the annual rainfall creates an irregular water level pattern in time and space. Therefore, at the beginning of the XX-th century, the authorities decided that these fertile floodplain regions should be drained and cultivated permanently, by building dams and draining the land. Starting from 1904, M. Roco (who had been hired in 1893 to work at the construction of the Fetesti-Cernavoda railway, and worked under the supervision of engineer Anghel Saligny until 1895, when the famous bridge over the Danube was finished) drew up the first projects and realized the first dams and drainage systems in the Danube’s floodplain, being a forerunner of land improvement and planning, fields which, at those times, were looked at with scepticism. In 1906 he finished a part of Spantov-Oltenita dam, which was considered a great success and represented the base for the first Land Ameliration Law, in 1906. The construction of dams continued in Oltenita region, as it had positive results Anul VIII, nr. 16
on fishing, and, at the same time, the expansion of agricultural land lead to an increase, in real terms, in the total surface of agricultural land in Romania. The first dams were built between Oltenita and Giurgiu, but in 1930, the works came to a stop. After World War II , the works were resumed in an ever faster rhythm and at an ever larger scale, which lead to the drainage of over 80% of Danube’s wetland. These works actually continued the extended deforestation process undergone by the Romanian Plain in the XIX-th century, when, as a consequence of the peace treaty signed in Adrianopol in 1829, the commerce and navigation along the Danube was liberalized. Thus, it occurred a sudden upsurge in grain demand on Western European market, which determined big projects involving the expansion of agricultural land in Romania. Grain production pushed forward the commerce, and thus, Romania became one of the most important European exporters. Romania’s wheat was listed on the Braila International Grain Stock Exchange. The price level fixed here became standard price for Western Europe and other regions as well. From the second half of the XIX-th century to the outbreak of World War II, Romania became a major grain supplier for both Western Europe, especially Germany and Scandinavia and Egypt, Syria and other East-Mediterranean regions. Between 1921 and 1932, the average grain-cultivated land surface in Romania was 11.1 million ha and an annual medium production of 1000 kg per ha was obtained. The best crop was collected in 1929, while in 1927 crop failure occurred. As regards wheat, an average land surface iunie 2005
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of 3.2 million ha was cultivated between 1921 and 1938. In the next period, during the communist regime, the figures in the statistics are not credible, as the statistics were often exaggerated or false, for propaganda purposes. After a period of full exploitation of the agricultural land in Danube’s floodplain, the crop began to fail. The new agricultural land was little by little affected by aridity, which resulted in loss of fertility and crop failure. Thus was discovered that the element left out during land planning was exactly the one which determined the very existence of Danube’s floodplain, that is, its annual inundability. The fertility of this land proved to be temporary, due to the river’s alluvium deposits, which were full of nutrients. Aridity also caused the need for irrigation. After the revolution in December 1989, during Romania’s prolonged economic transition period, the irrigation systems in Romanian Plain and Dobrogea were almost totally destroyed. Taking all these into consideration, the best solution for most of this land is ecological reconstruction, which can be done in two ways: by removing the dams and flooding the land, or by controlled flooding, by maintaining the existing dams. Thus, in case of pollution, the lakes and ponds can be isolated from the river avoiding any spread. Danube Green Corridor The existing damage to the floodplain and wetlands of the lower Danube and the increasing pressure of human activities have adverse effects on the ecologiAnul VIII, nr. 16
cal, biological and scientific values of the area. Thus, Romania, Bulgaria, Moldova and Ukraine (four countries bordering the Danube River) have agreed in 2000 to create Europe's largest cross border wetlands protection and restoration area. This initiative will establish the Green Corridor for the Danube, a stretch of at least 600,000 hectares (1.5 million acres) of existing protected wetlands and new ones along the Danube River. The objectives of the Danube Green Corridor project are: -assess the current state of the natural protected area -build new natural areas in the Danube Flood Plain -create natural cross border reservations together with Bulgaria, Moldova and Ukraine -designate the wetlands in the Danube Flood Plain -ecologically reconstruct some areas of the Danube Flood Plain -coordinate and indicate the sociocultural and economical activities -make a correct assessment of the environmental costs and long term environmental effects of the common actions of the Declaration signatory States The accomplishment of this project was the result of a decade of action focused on this direction. Thus, in 1992 WWF Green Danube Program is established. Six years later, in 1998, WWF Danube-Carpathian Program is initiated, and two years later, in June 2000 the Lower Danube Green Corridor Agreement was signed. In 2003, WWF (World Wide Fund for Nature) completed the official “Danube River Basin Public Participation iunie 2005
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Jurnalul Economic Strategy” as a contribution towards implementing the EU Water Framework Directive in the basin. The four countries have to establish programs and take all suitable measures to ensure the protection of the Lower Danube Green Corridor wetlands and floodplain habitat by: - protecting and restoring the wetlands and floodplain habitat in the Danube river basin, taking into account the necessity of protecting some social economic objectives of great importance from floods; - setting up a common standard system for water quality indicators allowing a clear evaluation of the state of the environment and certain human activities in buffer and economic zones; - protecting and improving the quality of water and environmental conditions of the Danube river ecosystem. The Lower Danube Green Corridor (which includes the Danube Delta) is composed of a minimum of 773.166 ha of existing protected areas, 160.626 ha of proposed new protected areas and 223.608 ha areas proposed to be restored to natural floodplain. The Lower Danube Green Corridor will comprise the following areas: - areas with strict protection regime - buffer zones with differentiated protection regime, in which human activities could be permitted and degraded areas restored
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- areas where sustainable economic activities could be developed. The Green Corridor for the Danube will include wetlands, lakes, flooded areas, flooded forests and meadows. In the last 100 years, more than 80 percent of the Danube River Basin's wetlands and floodplains have been destroyed. The floodplains have been disconnected and were affected by the impacts of development, dam construction, pollution and war. The aim of the agreement is to reconnect these lands to restore the essential wetland functions to the benefit of local people, nature and sustainable economy. References: Vlasceanu Gh., 1997, Populatia si asezarile din Campia Burnas, Editura Anima, Bucuresti Bratescu Gh., 2004, Povestea graului, Clipa, nr. 666, anul XIV, California, SUA * * * , 2000, Danube Green Corridor, Romanian Centre for River Restoration (www.rcrr.org) * * *, 2000, Declaration on the Cooperation for the Creation of a Lower Danube Green Corridor, Ministry of Water, Forests and Environmental Protection, Romania * * * , 1998, The WWF DanubeCarpathian Programme, World Wide Fund For Nature, Vienna, Austria (www.wwf.org)
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Place Branding: a Useful Approach to Place Management? G.J.Ashworth URSI, Groningen, NL
[email protected] The purpose of this review is to sketch briefly the history of place marketing from its origins within marketing science, geography and public sector place planning to its present applications in the Western city and its emergence most recently as place branding. The questions posed are, ‘what are we doing and why are we doing it?’ and, ‘is it both theoretically valid and practically effective?’ From marketing to place marketing The terminology, concepts and, to a more capricious extent, philosophy of marketing was imported into geography and spatial planning as an instrument for the description, analysis and planning of places during the course of the 1980s. The reasons for this can be traced to developments in marketing, geography and public sector spatial planning. Marketing had been developed, largely in the inter-war period as a technique for selling physical products by commercial enterprises for the clear purpose of profit in competitive markets. However the introduction of the three concepts of social marketing (i.e. where the objective is not the selling of physical products but influencing customer behaviour for social purposes), non-profit marketing (i.e. marketing by non-commercial enterprises for reasons other than direct monetary gain), and image marketing (i.e. where the product is an intangible perception or feeling unrelated to a physical Anul VIII, nr. 16
product) made possible a transference of the marketing approach to the public sector management of places. Similarly geography almost since its inception as a self-conscious academic discipline has had an interest, bordering at times on an obsession, with the idea of ‘sense of place’ (Ashworth & Graham, 2005). Places had a ‘genius’, a ‘habitus’ that was more than the sum of the natural or human features of which they were composed. The French concept of ‘pays’ or the similar German concept of ‘landschaft’ open up the possibility of treating places as products, for they assume that places are more than locations for phenomena or arenas for activities but are creations of the human imagination. It is not remarkable therefore that geography eventually embraced marketing: it is only remarkable that it took around a century to do it. Admittedly Ratzelian concepts of ‘Heimat’ (Ratzel, 1898) conceived of places as creatable, promotable and thus unstable, polysemic, imagined entities which were ‘sold’ by authorities with an interest in their ‘consumption’. However, it was aniunie 2005
46 other 100 years before academic geography became comfortable with the idea of places existing only in the mind. In the course of the 1970s the attention of geographers began to focus on three topics relevant to this argument. First, there was the geography of perception, encapsulated in the well-known work of Lynch (1960) and many less well known precursors, such as Tolman (1948). Secondly, there was the realisation that the nineteenth century exploration of semiotic metonyms allowed places to be treated as languages conveying deliberately inscribed messages for reading by their users (Ashworth, 1998). Thirdly, the geography of decision-making directed an emphasis upon how decisions that shaped places were made and indeed who made them and for what implicit or explicit reason. Taking these three, originally quite disparate, ideas together, it is only a short remaining step to the manipulation and management of these perceptions through the encoding and decoding of messages, in order to exercise influence upon this decision-making for some predefined purpose. However these developments would have had little effect upon the management of places if there had not been in the same period a vaguely felt but widespread disillusionment with the effectiveness of the traditional regulatory instruments of urban and regional planning, by the political and professional managers of places. For a variety of largely unconnected and diverse reasons relating to changes in fashionable political approaches, especially the rediscovery of markets in the 1980s, together with the failure of governments to make notable inroads into the deep-seated problems of regional economic disparity, Anul VIII, nr. 16
Jurnalul Economic multiple economic and social deprivation and exclusion, and urban poverty, dereliction and even governance. Numerous books and reports appeared in the 1980s which regarded cities as being merely assemblages of unsolvable economic problems, seedbeds of social malaise and increasingly ungovernable. Place marketing offered a new, if largely untried, possibility that was thus eagerly embraced for its promise and its novelty. It was not that ‘city boosterism’ was a new idea (see the nineteenth century historical cases described in Gold & Ward, 1994 and Ward 1998) but that that promotion (largely treated as a synonym for advertising) was a valid activity for public sector management agencies (Burgess, 1982) and that the systematic application of marketing was relevant to collective goals and practices. The transition from the random addition of some often crude and disembodied promotion to the existing tool box of planning instruments to a more far reaching application of marketing as a means of viewing and treating places as a whole was neither smooth nor complete. However by the beginning of the 1990s there was, if not a complete theory, at least a serious attempt to create a distinctive place marketing approach (Ashworth & Voogd, 1990; Berg et al., 1990; Paddison, 1993; Borchert, 1994; Ashworth, 1994; Ashworth & Voogd, 1994; Grabow , 1998). Since then a number of paradoxes have become evident. On the one hand marketing specialists have continued to refine their concepts and ideas and place marketing has become a commonplace activity of cities, regions and countries. On the other hand very few marketing specialists have given much thought to its appliiunie 2005
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Jurnalul Economic cation to places, treated as products, and, if they do, they too easily assume that places are just spatially extended products that require little special attention as a consequence of their spatiality. Equally public sector planners have long been prone to the adoption, overuse and then consignment to oblivion, of fashionable slogans as an understandable result perhaps of their necessity to convince political decision makers who place a premium on novelty, succinctness and simplicity. From marketing to branding A currently prevalent manifestation of place marketing is the advent of conscious place branding. Like place marketing, of which it is only a part, branding has its origins in the competitive selling of physical products by commercial enterprises. It must first therefore be explained and then its application to places by public sector agencies for wider economic or social purposes can be assessed. What is branding? The central question is, ‘what is a product brand and what is the process of product branding?’ How is it different from product differentiation, product positioning within competitive situations or just the unique selling proposition of a product: all of which are well known and easily understood concepts? Unfortunately there is no single accepted definition and the marketing experts have often compounded the problem in their attempts to elaborate (Rainstro 2001). Currently, there is at least a general agreement in the Anul VIII, nr. 16
marketing literature that the brand is more than an identifying name given to a product. It is also not (as Kotler et al., 1999, seem to be suggesting) a synonym for a single catchy slogan, however much this might embody the aspirations of the city authorities. A brand embodies a whole set of physical and socio-psychological attributes and beliefs which are associated with the product (Simoes & Dibb, 2001). It is more than the shaping of distinctiveness: it is the forging of associations. “… a brand is a product or service made distinctive by its positioning relative to the competition and by its personality, which comprises a unique combination of functional attributes and symbolic values” (Hankinson & Cowking, 1993: 10). Branding is a deliberate process of selecting and associating these attributes because they are assumed to add value to the basic product or service (Knox & Bickerton, 2003). From this value stems a series of consequential and important attributes about the nature of the product, of its marketing and of consumer behaviour towards it. The components of the brand The product A branded product requires a brand identity, a brand differentiation and a brand personality (Akker, 1996}. These are not so much separate attributes as restatements of the same feature from different perspectives. Identifying and clarifying the brand identity, or the core identity, is in itself an instrument of differentiation of one product from another and recognising its brand positioning, that is its relationship to competing products within a defined competitive arena. The process iunie 2005
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of product branding involves both creative initiation and subsequent careful maintenance. This brand management is thus both strategic and tactical although disproportionate attention in the literature is generally paid to the former. The objective of the process and method of measuring its degree of success is the increase in brand equity which is the extra benefit enjoyed by the consumer above the bare utility value of the product. Such equity in turn is composed of the two elements of brand value (i.e. the associations themselves) and brand awareness (the strength of the recognition of such associations). In summary, brand identity, brand positioning and brand image are related as in the diagram below. BRAND IDENTITY How the owners want the brand to be perceived
BRAND POSITIONING That part of the value proposition communicated to a target group that demonstrates competitive advantage
BRAND IMAGE How the brand is perceived
The producer Product marketing and specifically product branding has shifted much of the focus of its attention recently to the nature of the producer and specifically the idea of Anul VIII, nr. 16
corporate level marketing, and thus corporate branding, which is a development of traditional product branding, linked to other corporate level concepts, such as corporate image, corporate identity and corporate communications (e.g. Balmer, 1998; Balmer and Greyser, 2003; Balmer & Gray, 2003). Product branding is now generally subsumed into the branding of the organisations that make and sell them. The corporate brand can be defined as the state of will of the organisation. It is the expression of a corporate identity that “articulates the corporate ethos, aims and values and presents a sense of individuality that can help to differentiate the organisation within its competitive environment” (Riel and Balmer, 1997: 355). ‘The associations represent what the brand stands for and imply a promise to customers from the organisation’ (Aaker, 1996) or even an explicit ‘covenant’ (Balmer, 2001) between an enterprise and, not only its customers, but also its key stakeholder groups. This links the integrity of the product brand to the organisation and people behind the brand “a corporate brand is the visual, verbal and behavioural expression of an organisation’s unique business model” (Knox and Bickerton, 2003: 1013). The brand is expressed through the company’s mission, core values, beliefs, communication, culture and overall design (Simoes & Dibb, 2001). Crudely expressed, our products are different because we are different and they have added value because we have such value. The difficulties, limitations and vulnerability to unpredictable and unmanageable events of a corporate brand as so defined have been widely noted. “… aliunie 2005
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Jurnalul Economic though prevailing corporate thinking considers identity to be a monolithic phenomenon, this premise is narrow and inadequate” (Balmer & Greyser, 2002). It seems so self-evident as to be not worth stating that organisations are not a single organism but are a composite of individuals and thus inevitably possess multiple identities. These may “co-exist comfortably within the organisation even if they are slightly different” (Balmer & Greyser, 2002: 16) but equally may not and organisations manage their multiple identities to avoid potentially harmful misalignments. The consumer Branding is not only a differentiation of the product, it is also a differentiation of the consumer. The objective is brand equity, loosely defined as the extent and nature of the consumer’s knowledge of the brand which is composed in turn of the sum of brand value, brand awareness and brand loyalty. The first is the balance of positive or negative associations, the second the degree of recognition of the distinctiveness of the brand and the third the consistency of these variables over time. Each could be further refined and linked to brand image as which is the perception of the brand in the minds of people and ‘brand identity which is the creation of a relationship between the brand and the customers through a value proposition which may be functional and emotional. It perhaps needs reiterating here that although branding is performed by producers for their advantage, it is also in the interest of consumers in so far as it facilitates consumer decision making. Brand equity simplifies choice by allowing Anul VIII, nr. 16
consumers to rapidly identify products whose supply is guaranteed, quality controlled and stabilised . Brands are not only considered as valuable assets of a company, but furthermore in a post-modern consumer culture, play a vital role in the construction of consumer identity (Eliot & Wattanasuwan, 1998). Certainly there are links between the adoption of life-styles as group identifiers and the strong association between these and specific brands to the extent that groups themselves become branded with the product (e.g. compare the associations evoked by the ‘Armani set’ and the ‘Lonsdale set’). Much brand management in practice is an interaction between such lifestyle brands and the products they feature with producers attempting to exploit, create or even on occasion eschew such associations. From products to places What is place branding? The simple answer is that place branding is merely the application of product branding to places. However there are at least three different sorts of place branding which are often confused in the literature but which are really quite different operations conducted by different types of producers for widely different objectives. The first, is geographical nomenclature, the second, product-place cobranding and the third, branding as place management. Geographical nomenclature is merely where a physical product is named for a geographical location. The archetype is the sparkling wine, ‘Champagne’. This is iunie 2005
50 not place branding as we mean it here. It is merely, but interestingly enough, a copyrighted brand name, legally preventing other places from adopting the word but not the ‘champagne method’ and presumably preventing other producers in the location naming their different products with the same place title. There is no conscious attempt to link any supposed attributes of the place to the product, which gains nothing from the association which is only an historical-geographical accident which could conceivably have been somewhere else without loss. A place becomes only a name for a specific brand or, in other instances, a generic name for a production process. The place has no other significance and neither determines the locus of production or any other transferable characteristic: Parma ham receives nothing from Northern Italy, muslin from Mosul nor sprouts from Brussels. However there are many instances where it would be difficult not to name the product from its location as the geographical location is an important part of what is being sold. Property agents and tourism promoters come immediately to mind as they are unavoidably selling actual geographical locations. Here the typology begins to move away from the first category towards the second and third especially when sellers begin to select, modify and manipulate geographical nomenclature creating, in effect their own geographies in an attempt to enhance the product with spatial associations. Co-branding is common enough among physical products (it could be labelled the ‘fish-and-chips’ phenomenon). Co-branding of product and place, attempts to market a physical product by associating it with a place that is assumed to Anul VIII, nr. 16
Jurnalul Economic have attributes beneficial to the image of the product. Again the example often quoted in the text-book is ‘Swiss watches’. This is a different use of place nomenclature than ‘Champagne’ because the objective is to transfer characteristics of reliability, fastidiousness and meticulousness assumed to be associated with the Swiss people or the country Switzerland, to watches for which these are presumed to be desirable attributes. The product’s value is thus increased. This is an intrinsically dangerous practice if only because place images are both multifaceted and unstable. The above characteristics of the Swiss assumed to be beneficial to the product could be substituted by the much less helpful, and equally assumed, characteristics of parsimony, parochialness and creative dullness. Equally such place associations can change quite rapidly shifting from positive to negative associations. Consider the quite different associations implied by the place co-branding of Belgian beer, chocolates and lace. Thirdly, place branding can be treated as an instrument of place management. At its simplest level much place management depends heavily upon changing the way places are perceived by specified user groups. The creation of a recognisable place identity, little more than a sort of ‘civic consciousness’, can be subsequently used to further other desirable processes, whether inward financial investment, changes in user behaviour or generating political capital. It should be clear from the above definitions that this is more than the creation and promotion of place images as part of place management: it is attempting to add value iunie 2005
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Jurnalul Economic by moving perceptions of defined user groups from the generic to the brand. Are places place-products? An immediate, persistent and convincing objection to this whole line of argument is that places are just too complex to be treated like products. This would explain Hankinson’s (2001: 129) comments that “in contrast to the marketing of locations, there are relatively few articles to be found in the academic literature with regard to the promotion of locations as brands. This is in contrast to the increasing evidence in the press that branding, at least as a concept, is increasingly being applied to locations”. The conclusion of this argument is that place branding, like place marketing in general, is impossible because places are not products, governments are not producers and users are not consumers. However, place branding is not only possible, it is, and has been, practiced consciously or unconsciously for as long as cities have competed with each other for trade, populations, wealth, prestige or power. All branding tries to endow a product with a specific and more distinctive identity (Cova, 1996: 1997), which is, in essence, what most city marketing seeks to do for cities. A place needs to be differentiated through unique brand identity if it wants to be first, recognised as existing; secondly, perceived in the minds of place customers as possessing qualities superior to those of competitors; and thirdly, consumed in a manner commensurate with the original objectives. Thus identity, differentiation, personality and thereby positioning in competitive arenas are all transAnul VIII, nr. 16
ferable concepts as long as the implications of this transfer are fully understood. Places can be easily assumed to possess the characteristics of identity, differentiation and personality and can thus be managed to maximise equity, value and awareness. However, whether the terms suffer a significant shift in meaning when applied to place products remains to be considered. We can accept places as brandable products if their intrinsic and distinctive characteristics as place products are understood and a special form of marketing developed which accommodates and utilises these characteristics. Much of the literature from marketing specialists is not particularly encouraging in these respects. There have been numerous studies of the promotion of individual and groups of places, since Burgess’ pioneering account of (1982) promotional media used in UK local authorities. Almost 20 years later Hankinson (2001: 127-140) studied the practice of branding in 12 English cities, discovering that it was both widely used and little understood, which was a not altogether startling nor indeed very helpful conclusion but is all too typical of many such investigations. Trueman et al. (2001: 8-13) struggled with this problem of transfer of conventional product brand analysis to places, concluding that it was possible, ‘provided sufficient weight is given to different stakeholders’. This is no more than a recognition that places have more varied ‘users’, ‘owners’ and ‘governors’ than do commercial corporations and thus not only are the products more varied, so also are the goals of the producers and the utilities of the consumers. The two intrinsic weaknesses of stakeholder approaches, iunie 2005
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namely that the list will never be allinclusive and the weighting between them crude, are so more evident with places than with commercial products as to effectively admit that the conditions can never be met. The similarities between corporate branding and city branding have occurred to many observers (see the arguments in Kavartzis, 2004; Kavaratzis and Ashworth, 2005). Both have multidisciplinary roots (e.g. Ashworth & Voogd, 1990), both address multiple groups of stakeholders (e.g. Kotler et al, 1999; Ashworth, 2001), both have a high level of intangibility and complexity, both need to take into account social responsibility (e.g. Ave, 1994), and both deal with multiple identities (e.g. Dematteis, 1994). However it must be remembered that public place management corporations may have even greater difficulties than commercial companies in projecting a single clear corporate identity. Indeed most democratic political systems encourage the open expression of alternatives rather than concealing them within a spurious communal unanimity. How can we brand places? Finally the ‘how’ question can be considered although in most planning studies this would be the first, and often only, consideration. It should be evident from the arguments above that the instrumental choices are dependent upon answers to the preceding conceptual questions. You cannot answer, ‘how’ without obtaining prior answers to ‘what’ and ‘why’. It is not the main purpose of this brief paper to outline in detail the practical Anul VIII, nr. 16
techniques used by places to brand themselves. Suffice it to recall here that the three main techniques currently fashionable among urban planners can be listed as ‘personality branding’, ‘signature building and design’ and ‘hallmark events branding’. All are intended to not only attract attention and place recognition (thus brand awareness) but also to raise associations between the place and attributes regarded as being beneficial to its economic or social development (thus brand utility). ‘Personality branding’ (or ‘the Gaudi gambit’ after the success of its Barcelona application), depends upon the simple reality that people are unique individuals and this unique quality can be transferred to a place, if a place and person can be rendered inseparable. Artists as diverse as Mozart, Presley, Macintosh, Wagner, or Dudok are now associated through personality branding with cities as varied as Salzburg, Memphis, Glasgow, Bayreuth, and Hilversum, such that the place becomes inseparable from the creative work. The process is neither automatic nor necessarily beneficial. The more distinctive, indeed eccentric, and more visual the personality, the more easily it transfers to the place. Rotterdam’s current attempts to become the ‘City of Erasmus’ raises the obvious difficulties of not only an absence of global recognition of the person and his works but the near impossibility of linking a philosophical idea with a physical location. Perhaps ‘Kant’s Königsberg’ (Ashworth & Tunbridge, 2000) is exceptional. Similarly much personality branding is unintentional and even damaging. The Florence of Savaranola or even the Braunau of Hitler are associations which iunie 2005
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Jurnalul Economic many would regard as memorable but on balance undesirable. ‘Signature’ or ‘flagship’ building is hardly new: the Coliseum, Rome, Parthenon, Athens or Hanging Gardens of Babylon were all deliberately and spectacularly noticeable structures, intended both to house cultural activities but also be in themselves clear statements that the city in which they were located, and probably the governments that created them, were associated with wider desirable attributes. This process might be called the ‘Pompidou ploy’ after the grands projet on the Paris Beaubourg (Hamnett & Shoval, 2003). Flagships depend for their success on dual notoriety. The structure must be stridently noticeable, and the creator must score highly in the celebrity architect status scoring system. Functionality and aesthetic quality are largely irrelevant. Public museums, galleries and space for podium arts are a favoured function but private non-publicly accessible functions for such buildings are not uncommon (London’s Lloyds Building, Groningen’s Gasunie). A city with a genuine Rodgers, Libeskind, Gehry, Foster, Koolhaas et al. in its possession has acquired recognition and status by that fact alone. The third technique is the hallmark event, which is a regular or spasmodic cultural, economic, sporting, political or other occurrence that renders the place notable and confers upon it some desirable associations of patronage in some field. The established world renowned cultural festivals such as Edinburgh, Bayreuth, Stratford or even Glastonbury, Woodstock and Oberammergau support substantial profitable tourism industries but more important contribute more generally to the ambiance Anul VIII, nr. 16
and character of the place which may well have numerous beneficial spin-off effects in other economic sectors. This alone explains the fevered competition between cities for such designations as ‘European City of Culture’ or for hosting major sporting events. Three caveats must be mentioned to dampen any undue enthusiasm that such branding is a panacea for urban strategic planning. First, linking a particular city with a particular creative artist, signature design or cultural activity is a potentially dangerous strategy if only because culture, art and design are fashion driven activities in which today’s renowned celebrity is tomorrow’s forgotten nonentity. The Nazi era Kunsthaüser or Soviet era ‘Palaces of Culture’ now embarrassingly litter German and East European cities. Secondly, success in branding is more than the effective creation and propagation of a brand. Branding is only a means to an end and the attainment of that end may depend upon the operation of a much wider range of variables. In Bilbao, for example, the ‘Guggenheim effect’, has resulted in a global notoriety and an increase in short stay cultural tourists intent only on visiting a single museum. It has not however stimulated local cultural activities nor contributed much to the solution of the structural economic problem that was its original purpose. Thirdly, place branding is a cheap and seemingly simple activity. It can be performed almost anywhere and takes little investment. A game that anywhere can play is one that everywhere will attempt. The competition is likely to be intense and only the particularly skilful or fortunate will succeed. iunie 2005
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Jurnalul Economic Places, products and brands
This paper began with the assertion of the existence of a gap between two approaches to place branding, that of the marketing specialists familiar with commercial products and that of the public sector place managers. This gap has not been bridged here but its dimensions have been specified and some order has been brought to the confusion resulting from two quite different approaches. What can be termed the Kotler approach, from its most well known proponent, which is implicitly supported by most of the marketing science experts cited here, stems from the standpoint and experience of commercial product marketing. Here there is no logical or practical difficulty in transposing physical and place products, commercial and public corporations, customers and place users. Place branding becomes the use of place names as products and the use of place attributes as associations for products. In contrast the approach advocated here stems from the viewpoint and experience of place management, where marketing terminology, techniques and philosophies have been used for at least a decade as part of public sector management for collective goals. In so far as brands are assets that are expensive to create and manage, it is not surprising that brand owners endeavour to protect them from not least predatory competitors. It is perhaps a significant distinction that copyright law rarely applies to place products. (The ‘champagne’ type-case copyrights the nomenclature as product name not the place product in our sense of the word.) The disputes that have occurred, such as the Anul VIII, nr. 16
‘battles’ between spatial jurisdictions for ‘ownership’ of Robin Hood Country or King Arthur’s Camelot have not resorted to judicial resolution, which points up a number of significant differences between place products and other products. Place branding from the standpoint of the place recognises that place products remain places with the distinct attributes that accrue to places, such as spatial scale, spatial hierarchies, resulting scale shadowing, the inherent multiplicity and vagueness of goals, product-user combinations and consumer utilities. All these and more (as outlined in Ashworth & Voogd, 1990) make places distinctive products and thus place branding a distinctive form of product branding (Kavaratzis, 2004; Kavaratzis & Ashworth, 2005). If these distinctions can be recognised and incorporated into the process then it becomes a valid and effective form of management: if not, it is a fashionable irrelevance. Acknowledgment The study of the application of marketing to places for various purposes has for some time been a focus of research in the Faculty of Spatial Sciences, University of Groningen. The ideas behind this paper, therefore, owe much to my colleagues Piet Pellenbarg, Henk Voogd and Michaelis Kavaratzis. References Aaker DA, 1996, Building Strong Brands, Free Press, New York Ashworth GJ, 1994, Marketing of Places: What Are We Doing?, in Ave G and Corsico F (eds), Marketing Urbano Iniunie 2005
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Jurnalul Economic ternational Conference, Edizioni Torino Incontra, Torino Ashworth, G.J. (1998) The conserved European city as cultural symbol: the meaning of the text. In Graham, B.J. (ed) Modern Europe: Place, culture, identity Arnold, London 261-86 Ashworth GJ, 2001, The Communication of the Brand Images of Cities, paper presented in the Universidad Internacional Menendez Pelayo conference: The Construction and Communication of the Brand Images of Cities, Valencia Ashworth,G.J.and B.J. Graham (2005) Senses of place: senses of time Ashgate, Aldershot. Ashworth,G.J. & J.E.Tunbridge, (2000) The tourist-historic city: Retrospect and prospect for managing the heritage city. Elsevier, London Ashworth GJ and Voogd H, 1990, Selling the City: Marketing Approaches in Public Sector Urban Planning, Belhaven Press, London Ashworth GJ and Voogd H, 1994, Marketing and Place Promotion, in Gold JR and Ward SV (eds), Place Promotion: The Use of Publicity and Marketing to Sell Towns and Regions, Wiley, Chichester Ave G, 1994, Urban Planning and Strategic Urban Marketing in Europe, in Ave G and Corsico F (eds), Marketing Urbano International Conference, Edizioni Torino Incontra, Torino Balmer JMT, 1998, Corporate Identity and the Advent of Corporate Marketing, Journal of Marketing Management, Vol. 14, No. 8, pp. 963-996 Balmer JMT, 2001, Corporate Identity, Corporate Branding and Corporate Marketing: Seeing Through the Fog, Anul VIII, nr. 16
European Journal of Marketing, Vol. 35, No. 3-4, pp. 248-291 Balmer JMT and Gray ER, 2003, Corporate Brands: What Are They? What Of Them?, European Journal of Marketing, Vol. 37, No. 7-8, pp. 972-997 Balmer JMT and Greyser SA (eds), 2003, Revealing the Corporation, Routledge, London Berg L Van den, Klaassen LH and Meer J Van der, 1990, Marketing Metropolitan Regions, European Institute for Comparative Urban Research, Rotterdam Borchert JG, 1994, Urban Marketing: A Review, in Braun GO (ed.), Managing and Marketing of Urban Development and Urban Life, Dietrich Reimer Verlag, Berlin Burgess, J (1982) Selling places: environmental images for the executive Regional studies 16(1) 1-17 Cova B, 1996, The Postmodern Explained to Managers: Implications for Marketing, Business Horizons, Vol. 39, No. 6, pp. 15-23 Cova B, 1997, Community and Consumption: Towards a definition of the ‘linking value’ of products and services, European Journal of Marketing, Vol. 31, No. 3/4, pp. 297-316 Dematteis G, 1994, Urban Identity, City Image and Urban Marketing, in Braun GO (ed.), Managing and Marketing of Urban Development and Urban Life, Dietrich Reimer Verlag, Berlin Elliot R and Wattanasuwan K, 1998, Brands as Symbolic Resources for the Construction of Identity, International Journal of Advertising, Vol. 17, No. 2, pp. 131-144 Gold JR and Ward SV (eds), 1994, Place Promotion: The Use of Publicity and iunie 2005
56 Marketing to Sell Towns and Regions, John Wiley and Sons Ltd, Chichester Grabow B, 1998, Stadtmarketing: Eine Kritische Zwischenbilanz, Difu Berichte, 98/1, pp. 2-5, Deutsches Institut für Urbanistik Hamnett, C. & N. Shoval (2003) Museums as flagships of urban development’ In Hoffman LM, S.S.Fainstein, & D.J.Judd, (eds) Cities and visitors: regulating people, markets, and city space. Blackwell, Oxford. 219-36. Hankinson G, 2001, Location Branding: A Study of the Branding Practices of 12 English Cities, Journal of Brand Management, Vol. 9, No. 2, pp. 127-142 Hankinson G and Cowking P, 1993, Branding in Action, McGraw-Hill Book Company, London Kavaratzis, M.(2004) From city marketing to city branding: towards a theoretical framework for developing and managing city brands. Place branding 1 (1) 5873 Kavaratzis, M. & G.J.Ashworth (2005) Place branding: useful instrument or fashionable irrelevance. Tijdschrift voor economisch en social geografie Knox S and Bickerton D, 2003, The Six Conventions Of Corporate Branding, European Journal of Marketing, Vol. 37, No. 7-8, pp. 998-1016 Kotler P, Asplund C, Rein I and Heider D, 1999, Marketing Places Europe: Attracting Investments, Industries, Residents and Visitors to European Cities, Communities, Regions and Nations, Pearson Education Ltd, London
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Jurnalul Economic Lynch, K. (1960) Image of the city MIT press, Cambridge Paddison R, 1993, City Marketing, Image Reconstruction and Urban Regeneration, Urban Studies, Vol. 30, No. 2, pp. 339-350 Rainisto SK, 2003, Success Factors of Place Marketing: A Study of Place Marketing Practices in Northern Europe and the United States, Doctoral Dissertation, Helsinki University of Technology, Institute of Strategy and International Business Ratzel, F. (1898) Deutschland: einführung in die Heimatkunde Grunow, Leipzig. Riel CBM van and Balmer JMT, 1997, Corporate Identity: The Concept, its Measurement and Management, European Journal of Marketing, vol. 31, No. 5-6, pp. 340-355 Simoes C and Dibb S, 2001, Rethinking the Brand Concept: New Brand Orientation, Corporate Communications: An International Journal, Vol. 6, No. 4, pp. 217-224 Tolman E. (1948) Congitive maps in rats and men Psychology Review 55 189208 Trueman MM, Klemm M, Giroud A and Lindley T, 2001, Bradford in the Premier League? A Multidisciplinary Approach to Branding and Re-positioning a City, Working Paper 01/04, Bradford University, School of Management, Bradford Ward SV, 1998, Selling Places: The Marketing and Promotion of Towns and Cities 1850 - 2000, E & FN Spon, London
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City image. The dynamic of inside perception between 2001 and 2004 Case study: Ploieşti Assist. Prof. Marius-Cristian Neacşu, PhD candidate AES Bucharest The purpose of this review is to sketch briefly the history of place marketing from its origins within marketing science, geography and public sector place planning to its present applications in the Western city and its emergence most recently as place branding. The questions posed are, ‘what are we doing and why are we doing it?’ and, ‘is it both theoretically valid and practically effective?’ City image. The dynamic of inside perception between 2000 and 2004. The aim of this paper is to identify changes in inside perception of the Ploieşti city, a real sequence of Romanian urban habitat, giving the effects of the communist urban planning policies. On the other hand, city image, which represents the mental perception of the city, could be the solution for a “good” planning in order to develop a “good” place for living. Also, the paper examines inner image of Ploieşti city, identifying “attractive” and “repulsive” areas as they were indicated during the two questionnaires made in 2001 and 2004. Key words: city identity, city image, city planning, urban geography Premises The city, seductive from the point of view of scientific approach, has known different and multifarious approaches throughout the academic community, over the years, while its meanings became more and more complex. What it is that determined this “anthropic power”, unequalled on Earth (as George Bugliarello names the urbanisation process, Rethinking Urbanization, 2000) is not very clear, but its roots go deep into the sedentary process, induced by the agricultural revolution from the Neolithic. Disregarding the laws that it has obeyed during its evolution, or the geographical spaces that it has configured, this particular type of habitat has set its sole “beneficiary” Anul VIII, nr. 16
as being mankind. And the human community is acknowledged to be the pressure factor concerning the urban space organisation. Therefore, it turns interesting to analyse the mental meanings that the city and the urban forms generate. Is this to say that the man is prisoner of the habitat, or may, the habitat, in this particular urban context, be modified under the empire of that particular human community’s perception? In 1960, year that marks the start of an especially scientifically fertile decade, because of the new concepts that arose from the academic debates and the university scientific groups, on the background of the modernist trend that used to dominate the society, and researchers’ opponent iunie 2005
58 opinions related to its consequences (the depersonalisation of cities, and of urban life, the attempt to understand the city, and the way it works, as an engine, as a system, the human community remaining a simple quantitative component in this whole gearing; the exaggerating of geographic determinism and the models’ monopole in the scientific approach of cities), the American citizen, Kevin Lynch launches the concept of city image, as an idea and as an expression, in the pages of the work “ The image of the city”, whose promoter he was, along with Jane Jacobs, Christopher Alexander and others. Therefore, urban elements and forms create certain connexions and meanings in the mind of the urban actors. The physical part of the city is doubled by the mental one (the mental map, the urban image). The mental city outlines, or at least should indicate the lacks in functionality in the physical city. People are no longer prisoners of a predefined urban model, determined in its whole, but now like or have a repulsive attitude towards certain elements or forms that appear in the urban landsacpe. The inhabitants, therefore, become an active element in the reconfiguration and resize of the urban architecture. For Lynch, the city is a “text” that is deciphered, decrypted by the inhabitants, or by the simple bystanders of that particular ur-
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Jurnalul Economic ban life. Therefore, the city must be “readable”. If it is “readable”, then it is decoded and correctly perceived by people, that is it has meanings. If the elements and the urban forms are loaded with significances, then, the city has an identity. The organisation of the urban space / urban planning are completed by the urban design, a complex interface through its interdisciplinary, among many disciplines that study the urban space, with a significant applicative power at detail level. The urban design influences the human perception, creating, therefore, a certain city image. The city image becomes, then, a work device strong enough for a future organisation of the urban space, as well as by nature of the impact that it may have on the business environment interested in that city, setting a certain course regarding city marketing. By the nature of its activity and image evolution, the city has became today a genuine “urban product”, producing, and being through itself, a “brand” – city branding. The attempt to relate urban space with economic profitability becomes, more than ever, an essential philosophy of urban space organisation, and not only an instrument used for blurring the lacks in functionality and also for solving some problems regarding urban planning.
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URBAN PLANNING
URBAN DESIGN
CITY IMAGE
URBAN BRANDING
URBAN MARKETING
Figure no 1. The relations between city image and other concepts that approach the urban space coherence and the continuity of life in that The city – identity and image. Theourban community. (G. Dematteis, 1994). retical considerations Also, the identity of a city is the expression of the ways the urban space has Each city from the map of the been planned in the past, materialised in world is identifiable through a series of external, voluntary interventions, whose qualitative or quantitative attributes that effects have been amplified, diminished, or make it unique in the world urban “tissue”. even annulled by its own, internal organiTherefore, the geographic coordinates, the sation of the city - self organisation demography, the localisation, the shape, all which is dominant and permanent. This is of them constitute just as many exterior how the identity becomes an expression of “dimensions” that offer the possibility of (self) organisation, of the city as seen in the an indubitable identification. “past”. If we try to approach the “present” Although all the cities may be idenor the “future” city, its identity is transtified precisely, not all of them have a posed into image - city image. This is “clear” identity, on the contrary, many of nothing else than the mental representathe contemporary cities raft across a genution of the city at an individual/urban ine identity crisis. community level. The city identity designates that Basically, there are “two” realities: unitary set of characteristics, capable of a) the objective reality, resulted having the same meaning for each inhabifrom a complex of geographical conditant of the city (Brunet & Ferras, 1992), tions, that act independently from human reflecting itself at a mental level through a will and that is submitted to cosmic laws symbol, adopted and “built” in time, by b) the perceived reality, which is each generation, symbol that insures the in accordance with different dependent or Anul VIII, nr. 16
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60 independent variables (sex, age, education, income, health etc.), and with the perception scale. As such, city image represents the perception of present urban reality – “the first reality” (the objective one) –, practically, a mental representation of it, “a second reality” (Racine, 1994) or “a second city”, the one identifiable through social inquiries. Likewise, for any city there is a collective image, a mental product of the human community that populates and represents it, but also, individual images of the urban actors, unique images, mental representations of the city, of its neighbourhoods, of its streets, through some physical directly perceptible landmarks, which sometimes become animated, more or less, by different social meanings of some objectives, areas, by their history or name. Lynch’s idea resides in the isolation of some urban elements and the diagnosis of the inhabitants’ view of them, searching for the meanings that they have on a mental level. As such, some distinctive elements are aimed: • The paths. They are ways of access along which the observer (a simple inhabitant of the city or a visitor) passes by, occasionally or potentially, with the purpose of reaching certain objectives, either by foot (and it is interesting here to observe the quality of the sidewalks and of the pedestrian crossings), either by a vehicle (case in which the dominant of the perception is given by the quality of the traffic road). For most of the inhabitants, the streets are the predominant elements of the city image. People observe the city Anul VIII, nr. 16
Jurnalul Economic when they pass through it and some elements of the urban landscape are allotted in space and spotted in terms of their localisation along a street, a boulevard, etc. Therefore, for the inhabitants of Ploieşti, as well as for the ones outside it, who come here, The Republics Boulevard dominates their image of the city, through the clear express in the urban landscape, as well as through the fact that, the starting point, as well as the destination of the boulevard are clear and well known, fact that confers it a stronger identity, with more powerful accents in the perception of inhabitants, as well as through the functional characteristic associated with it, as the Republics Boulevard represents a genuine commercial thoroughfare of the city, not disregarding the creative valences manifested in the green zone in Mihai Viteazu Square, whose dominant symbol is, of, course, the regnant. Also, there are other elements of the city landscape associated to the boulevard, deeply rooted in the inhabitants’ memory - the headquarter of National Company of Electricity, identified by its colour, as it is known as the “Red House”, the Cemetery of the Russian Soldiers, etc. In the same way, the Independence Boulevard (which leads to the South Train Station of the city) represents, for many of the ones interviewed, an attractive area, especially considering its particularity - the presence of a remarkable street alignment, the route being known by the inhabitants as the Boulevard of Chestnuts, with leisure valences, its identity plus being offered by the fact that during the week-end, the road traffic is forbidden, therefore becoming a re-creative space for the week-end. iunie 2005
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NORTHERN INDUSTRIAL ZONE
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• The nodes. These are “strategic” places or points, penetrable by an observer, from and towards his destination. Some of these “nodes” represent the nucleon of those districts, that constitute themselves as symbols for that particular area and around which they clearly show their influence. Well marked in the urban landscape, through squares, and roundabouts (signalled by Kevin Lynch as being genuine “breaches” in communication, where the rhythm or direction is sensibly changed) are the crossings situated along the Republics Boulevard and the Independence Boulevard that go through the city from north to south - Mihai Viteazu Square, The Heroes Square, The Victory Square, the 1st of December Square -, along with other secondary nodes of local importance. • Landmarks. They are another type of reference elements for the city image, with a particular typology; they are external, impenetrable by the observer. This category is constituted from reference elements that have a certain local utility, when they can’t be “seen” except from certain places or from certain angles. This is the case of certain road posts, shop windows, some institutions or churches (St John’s Cathedral, for example, in Ploieşti), Anul VIII, nr. 16
different elements (the “Clock” from the Civics Centre, the Central Halls) or other details of the urban landscape that “fill” the inhabitants’ image. • The Neighbourhoods. They are fundamental “cells” of the urban social space, with a remarkable internal cohesion through which that urban community perceives the whole city. Therefore, in most cases, the district image is reflected on the general qualitative image of the city, taking into account the time spent inside that particular neighbourhood. Also, the district may set a certain social behaviour to its inhabitants. The neighbourhood is acknowledged through a certain characteristic (texture, space, forms, details, symbols, type and colour of buildings, social significances with a certain emotional meaning, type of activity, functions, inhabitants, degree of maintenance/usage, topography, etc. Kevin Lynch, 1967), which allows the observer to identify it, if he is inside it (endogenous perception), characteristic that transforms itself into a basic reference, if the subject is outside it (exogenous perception). As such, the districts are relatively wide areas of the city, which may be mentally identified by the observer, and that have certain own internal quality. Practically, at a perceptive level, each district is unique, impressing a certain belonging spirit to its inhabitants, which may sometimes be identified as a strong urban community held in a tight internal cohesion. Under these aspects, the city of Ploieşti, as most cities in Romania, for that matter, knowing the communist systematisation, seems a city lacking in history, with an almost chaotic aspect, with functional spaces that imbed, the districts, in their iunie 2005
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vast majority, keeping the monotony of serial buildings, with grey, lacking in personality facades, specific to work districts, spread in most part of the city, especially in the western side, not presenting a distinct, internal differentiation, for many of the people interviewed. • The limits (discontinuities). These are linear elements with a precise identity for the observer, diametrically opposed to the access ways. These are frontiers between two types of precincts. Therefore, it is worth mentioning the railway from the south of Ploieşti, brutally
inserted in the residential part of the city, separating the urban periphery in which industrial precincts (Southern Industrial Zone), the transport precincts (the railway, the National Route no 1) and the residential precincts girdle, the latter which being indicated as repulsive areas (the Mimiu, Petrolului, Râfov, Moţoi neighbourhoods) by the people interviewed. The same repulsive valence is attributed to Bereasca district, separated through a double limit by the “core” of the city - the Dâmbu brook and the railway from the North-East. railway and
LUPENI RUDULUI
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The concept becomes extremely interesting, especially in the urban Romanian environment, on the first hand because of the excessive centralisation and the nationalisation of the intention to act at the level of urban space, through the creation of new urban spaces or the reconfiguration of the already existing ones, in its functional, and also aesthetic dimension (“a sense of beauty” absolutely specific to the architecture and the communist regime’s urbanism, that had to mark a city with working ambitions), and on the other hand, because of the situation created after 1989, when private urban space appeared, and everything failed in the other side’s court: an excessive tolerance, urbanistically speakAnul VIII, nr. 16
SIL VA N
S-E INDUSTRIAL ZONE
RÂ PE
AN
ing and the arise of some spaces and urban forms out of local urban community’s control and acceptance. In both cases, the man is the “prisoner” of the urban habitat, whom he can only perceive, but his perception does not contribute to the outline of that city’s identity. The quality of life in the urban environment is tightly related to the quality of the public services, along with the feeling of belonging to that particular community, and the fact that certain elements or urban forms express common meanings for each of the city’s inhabitants. The city image reflects in a very high proportion, the urban identity. And the latter one may be preserved, strengthened, and even changed iunie 2005
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Jurnalul Economic through the activity of local authorities who promote the urban spaces, in their attempt to attract investors. The above presented elements constitute the “rough material” that lies at the basis of drawing up a city image. These do not appear as singularities, but are put into a scheme; they receive value and significances through the relations among them. This is why the perception scale (the “geographical resolution”) is essential for the general outlining of a city image. As such, a landmark means nothing unless the resolution is increased (the perception scale is reduced), if it is not inserted into a scheme on the street, in a crossroads, in a neighbourhood, in a part of the city, city reflected by a number of mental individual images, number proportional with the number of inhabitants. Methodological aspects This study has been carried out using two questionnaires that were conducted in 2001 and 2004 in Ploieşti city, on two experimental focus groups (250, respectively 200 inhabitants). The selection of the focus group in 2001 has been done randomly, on the street, and it was conducted under the form of an interview, considering a qualitative questionnaire, and in 2004, the study was conducted through an online application on the Internet, on the web pages of the city (with all the advantages and disadvantages that incur from this). The questions were closed, semiopen that offered the opportunity of attaching personal details (following the model of something else/what?) and open, especially the ones aiming “deficiencies”, Anul VIII, nr. 16
“solutions” or “prognoses” (for ex: How would you see Ploieşti city in twenty years’ time?) Objectives: a) the perception on urban habitat and the inside perception on city image; b) the links that may be established between the perception on the city and different independent variables, selected in the heading of the questionnaire - sex, age, education, the length of time spent living in that district, etc (the hi square significance test); c) the identification of causal relations between the perception on different life and urban living conditions (the urban habitat) and the perceived quality of the city image; d) the outline of some territorial disparities and of some opinion regions (perception maps). Case study: Ploieşti
Identification elements. The municipality of Ploieşti is one of the large cities in Romania (250 000 inhabitants), situated in the SE, 60 km north from the capital Bucharest, iunie 2005
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fact that has constituted both a favourability factor, but also a restrictive one, in certain moments of its evolution. Situated in the plain, right at the contact with the sub-Carpathian frame from the north, it has benefited from the complementarity of the resources, developing as a true district capital, with a functional complexity of the spaces, being, altogether, a developing pole on the urban-industrial axe of BucharestBrasov . Identity elements. When hearing the name of Ploieşti two things come to mind, before anything: oil and the one day Republic. The first imprinted it with the functional dominant for almost a century; at Ploiesti the price of oil in the world was set towards The First World War, and the second marks a sequence of its historical evolution, which began over 500 years ago. Each evolution phase marks different particular features of the habitat, and also, phases in the organisation of the urban space: o
Village (before 1600)
I n this phase, the hearth of the settlement was in the SE of today’s city. Although it was in an active transit space between the Carpathians and the ports from the Danube, Ploieşti was nothing but an insignifiAnul VIII, nr. 16
cant village compared to the surrounding blossoming townlets – Targsor, Gherghita, Filipeşti, etc, where the agric activity was preponderant in the life style. o borough (1600-1800) The period is defining for the town’s ulterior evolution. In 1599, Ploieşti takes a considerable leap, becoming a borough, which had as premises: the position at the crossroads of the commercial ways coming from Transylvania and Moldavia with the ones from Walachia, as well as the protectionist system instituted by Mihai Viteazu, (weekly market in Ploieşti and the forbidding of this thing in the other surrounding townlets). The commercial and trade activities (professionals from Brasov are prompted) come to have a special amplitude, imprinting a chaotic development to the borough, which expands greatly towards N and S, along the Dambu brook. In the mid 18th century, Ploieşti becomes a chief town, acquiring administrative functions. o Trade centre (1800-1850) In this phase, the town expands towards W, increasing its built surface from 1.9 square km to 5.2 square km, following especially the penetration arteries from the W (Targoviste) N (Brasov), and S (Bucharest). Concomitantly, the population Increases, especially due to the migration of the inhabitants from the surrounding townlets (who did not beneficiate from the political protectionism), but also, due to the foreign immigrants (for example Bulgarians, fled after the Russian-Turkish wars) Meanwhile, the commercial function intensifies, being doubled by the communicaiunie 2005
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- Ploieşti is tied to Bucharest through a telegraph line; • 1857 – the first oil distillery in the world (the property of Marin Mehedinteanu) in the SE of today’s city; • 1858 - Ploieşti, the second city in the world illuminated with lamp oil (after Bucharest, 1857);
o Industrial city (1850 – The First World War) It is the time of the “oil boom”, when Ploieşti expands considerably, when the city increases its surface four times, reaching over 19 square km in 1912, and approximately 50 000 inhabitants, Romania’s fourth largest city after Bucharest, Braila, Craiova, with a population density that was over 2000 inhabitants per square km. International interests are inserted in the area, the petroleum societies being based mainly on German, French, English, Dutch and American capital. The great oil pipelines of the state (PloieştiConstanta, Ploieşti-Giurgiu) are doubled by the many private oil pipelines that surrounded Ploieşti. o Capitalist industrial city (,,interwar”) Anul VIII, nr. 16
After the First World War, Ploieşti expands, from a territorial point of view, but the deficient capitalism imprints it a chaotic development, the rank of city being kept mostly through functions than through the urban aspect, the public-private mixture imprinting it with negative visual connotations, with regards to its image. The agric reform (the appropriation of the land to the peasants) leads to the population settlement in the rural medium, the annual growth rhythm according to the censuses from 1930 and 1948 reducing to half of the one from the period in the beginning of the century, from 2.4% (19121930) to 1.2% (1930-1948). The lack of concordance between the city’s territorial expansion, favoured by the topographic conditions, and its population materialises in the poor valorisation of the urban space. o Municipality (the “socialist” phase) After the Second World War, the horizontal expansion diminishes in favour of the vertical one. The city does not expand considerably in its territory, but the population increases in a rhythm without precedent, due to the socialist policy from the post-war period. iunie 2005
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The setting up of the communist system draws important modifications to urban life: The vigorous implant of industry begins; Homogeny policies are applied, regarding the territorial repartition of the production forces;
The systematisation (the building of new neighbourhoods or the rebuilding of older ones which had a low building density) which brushes up the spatial distribution of the population; A fairly numerous available work force is created due to the collectivisation from the rural medium;
Communist period
old city core (before
between 19001945
Sequences in urban planning, by street network (Ploieşti, Romania) It is the time of the great petrochemical platforms of Ploieşti – Brazi, Teleajen – which absorb the young work force form the surrounding settlements, but also form much longer distances, especially from Oltenia and Moldavia. Between 1966 and 1977, the city generates over 60% of the industrial production of the district, and more than 90% of the commercial trade is made with products finalised in the city. It is also worth noticing Anul VIII, nr. 16
that in the same time, the city consumed over 10% of Romania’s electrical energy. After 1980, on the fund of a political crisis of a super centralised system, the inhabiting conditions begin to deteriorate. o After the implosion of the communist system The radical change of the political system draws mutations and reconfigurations of the urban space. Some functional spaces modify both on the fund of the iniunie 2005
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1. Administrative, services, cultural, residential 2. Residential (traditional – old neighbourhoods) 3. Residential (communist – block of flats) 4. Industrial 5. Transports (railway) 6. University of Oil and Gas 7. Commercial (Mall - Metro) and new residential Functional zones (Ploieşti, Romania)
Around the central area the residential space concentrically distributes itself, the older neighbourhoods in which houses predominate lying in its proximity, towards the exterior, lying the newer “worker” neighbourhoods. It is worth mentioning that the residential area expands over the ring of railways, especially in the S area of the city. Well individualised and located in the territory, in general outside the road and rail ways ring, lye, in the proximity of the city, the four industrial areas: - The Northern industrial area – compact, of relatively reduce dimensions; the petroleum refining, polluting industry predominates; - The Eastern industrial area – traditional (refining) industrial activities, thermo-electrical power station; iunie 2005
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- The Southern industrial area – oil distilleries, petrochemistry, car constructions; it is dispersed in the territory, being strongly stifled by the residential area, the transport, etc. - The Westen semi-industrial and deposit area – alimentary industry and warehouses.
The green space is extremely dispersed. The city disposes of almost 3.7 square km (6.4 % of the city’s surface) of green space, as 11 to 15 m2 are due to each inhabitant (much below the W.H.O medium of 50 m2 per inhabitant).
seg me nt of over 55 (23% in 2001, as opposed to 3% in 2004); The two sexes are represented almost equilibrate in 2001 (42% masculine and 58% feminine), whereas in the second poll, it seems to highlight mostly the masculine perception (67%); It seems that, at least at the level of 2004, the Internet has been accessed by people owning a university degree (approximately 70%), as opposed to a third in the classical poll; Regarding the type of residence (one level house or block of flats), the differences are insignificant; in both cases pre-
Ploieşti – the hypertrophy of the urban network in the Prahova county City Image. The dynamic of inside perception between 2001 and 2004. Firstly, between the two although quantitatively similar samples, some clear differences have outlined, as a result of the way of “selecting” the respondents: in 2001, street questionnaire, random selection, whereas in 2004, Internet questionnaire (hosted by different sites of Ploieşti) Therefore, some differences have been outlined: A population segment, aging between 18 and 25, with 20% larger than in the case of the street questionnaire, difference that is perfectly reflected in the age Anul VIII, nr. 16
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Jurnalul Economic dominate the owners living in blocks of flats; The perception of the inhabitants regarding the city image of Ploieşti is relevant through the large percentage (approximately 70%) of the ones living in this city for over 15 years. The perception from micro-scale to macroscale. It is obvious within the two sequences of the study, the differentiated perception from the micro-scale (residence level) to the macro-scale (neighbourhood and city), the percentage of the people who appreciate the quality of their own residence as being good and very good (86% in 2001 and 65% in 2004) knowing a significant decrease as regards to the appreciation of the street, the neighbourhood, or the city, case in which there is a growth in the percentage of the undecided (I can’t tell, respond, with regards to the neighbourhood between 14 and 35% of the people interviewed). The results highlight an absolutely natural thing, considering that each man knows its own residence better than the street or the neighbourhood he inhabits. Correlation between variables and the acuity of perception. Applying the hi-square test (the test of the null hypothesis), it has resulted that the perception is distorted inversely proportional to the own income. As such, in the case of the people with low income, the acuity of the perception as regards to the living conditions increases. City image. Although there is an entire segment in the questionnaire that aims the living conditions, the last part of the poll is interesting with regards to identifying the perception on city image. As such, according to the results of the questionnaire, it seems that the city of Ploieşti is Anul VIII, nr. 16
not an attractive place from the point of view of the business opportunities, as at the statement “The city offers many employment possibilities and business opportunities”, 77% have stated that they “disagree” or that they “partially agree”. The negative perception is enhanced by the high percentage (over 65%) of the ones who respond in the same manner in the case of the statement “Ploieşti is an extraordinary place for me to live in along with my family”. In return, over 40% perfectly agree with the statement “It is a city with a working aspect (series of grey blocks) which has not preserved its historical past.” Also, the inhabitants of Ploieşti name precisely the first three things they dislike most in their city, as the analysis of the responses for the afferent question outlines predominantly the sector of public services (street cleaning, illumination, and public security, but no lastly, the behavioural hazard), a small percentage of the people interviewed indicating also the architectural aspect. The question “Which are the first three things that you like most within our city?” also highlights some interesting aspects: Firstly, the diffusion of the perception in a very wide spectre: from concrete elements (The Chestnut Boulevard, which in 2004 has the highest percentage, the Palace of Culture), and diverse social aspects or elements related to the urban services. A significant percentage (17% from the 2004 questionnaire) does not respond to this question, although they have given answers to the former one. 55 % of the people interviewed in 2001 and a similar percentage in 2004 are not satisfied with the ensemble image of the city of Ploieşti. iunie 2005
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„Which do you consider to be the symbol that represents the city of Ploieşti?” is the edifying question form the questionnaire, with regards to the perception on the city image or identity. And the study has showed that over a third of the inhabitants who were interviewed indicates as symbol or associates the city image to the petroleum or the connected elements (oil distilleries, The University of Petroleum and Gas or the Museum of the Petroleum).
Mental maps. The results of the study have allowed the identification and outlining of some attractive and repulsive areas in Ploieşti, highlighting, in the first case, the central part and the axe of the boulevards that go across the city from North to South, and in the second case, the peripheral neighbourhoods.
“Attractive areas” (left) and “repulsive areas” (right)
I. Centre -,,the city core”; all urban fluxes converge to it; - Administrative space (The City Hall and local government headquarter); - Cultural space (The Palace of Culture which covers the largest public library “Nicolae Iorga”, the Theatre “Toma Caragiu”, the Philharmonic, Museums - Watches Museum, Oil Museum etc.); - Services (banks, tourism agencies, the shopping centres); - Residential space
The outer neighbourhoods I. East - the oldest part of the city, over Dambu River and the railway (double discontinuity); - one level houses are predominant; - scarcity of public utilities (the quality of streets, salubrity, public illumination etc.); - ethnical segregation; - a large part of the interviewed people want to move away.
II. The Boulevard of Republic - It has large squares with green space (“Mihai Viteazu” Park, with a towering equestrian statue of the prince); - Commercial; - the northern axe of the city (North-Centre);
II. South - situated out of the city across the railway from the southern part; - periphery located in the middle of industrial space; - poorness aspect of the neighbourhood; - less public security; - problems with urban infrastructure
Conclusions Romania, and in general, the countries from the former communist block constitute a “fertile” ground for complex studies of urban and social geography, Anul VIII, nr. 16
which are very attractive to the researchers in the area, as we are in the phase of crystallising some work models. Although the city image is an especially attractive concept to the geographers, it requires an interdisciplinary approach iunie 2005
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Jurnalul Economic and the understanding of the way in which the concept may be fully operable in the following urban planning studies. There are no clear perception differences between the two opinion polls made in Ploiesti (2001 and respectively, 2004), especially regarding the attractive and repulsive areas of the city, although the samples from the people interviewed have been sensibly different regarding the structure. However, on the basis of this primary perception, repeated polls must be made, with a more and more profound degree of detail and specificity. The results of this study have shown that the social status and the quality of life distort the acuity of people’s perception of the city they live in, regarding the aspects related to identity, symbols, etc. The mental maps and the situation of the perceptions have outlined an attractive area on the North-South axe of the city, crossing the central part, with a complex functionality, while a general totally negative perception is represented by the neighbourhoods situated outside the area of the “city body”, beyond the discontinuities (railway etc.) at the periphery of the city, in the proximity of the industrial platforms. It seems to be a typical situation for the forced industrialised cities that are going through functional and why not, identity reconsideration times. References:
2. Dematteis, G. (1994), Urban identity, city image and urban marketing, Institut für Geographische Wissenschaften, Berlin. 3. Lynch, Kevin (1977), Image de la cité, Fac. de Arhitectură, Bucureşti. 4. Akkerman, Abraham (2000), Harmonies of Urban Design and Discords of City-form: Urban Aesthetics in the Rise of Western Civilization, Journal of Urban Design, Vol. 5, Nr. 3, Carfax Publishing Company, U.K. 5. Erickson, Bill, Roberts, Marion (1997), Marketing local identity, Journal of Urban Design, Vol. 2, Nr. 1, Carfax Publishing Company, U.K. 6. Ianoş, Ioan (2000), Sisteme teritoriale, Ed. Tehnică, Buc. 7. Montgomery, John (1998), Making a city: urbanity, vitality and urban design, Journal of Urban Design, Vol. 3, Nr. 1, Carfax Publishing Company, U.K. 8. Neguţ, Silviu (1997), Modelarea matematică în geografia umană, Ed. Ştiinţifică, Buc. 9. Schurch, Thomas W. (1999), Reconsidering urban design: thoughts about its definition and status as a field or profession, Journal of Urban Design, Vol. 4, Nr. 1, Carfax Publishing Company, U.K. 10. Salingaros, Nikos (1999), Urban Space and its Information Field, Journal of Urban Design, Vol. 4, Nr. 1, Carfax Publishing Company, U.K. 11. Sevastos, Mihai (1937) - Monografia oraşului Ploieşti, Tiparul Cartea Românească.
1. Bugliarello, George (2001), Rethinking Urbanization, The Bridge, vol. 31, no.1 (electronic version).
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Magnifying Firm Dynamics. Micro Level Dynamics in a Population of Dutch Firms, 1998-2003 Paul J.M. van Steen Urban and Regional Studies Institute, Faculty of Spatial Sciences University of Groningen, The Netherlands
[email protected] The demography of firms approach studies changes in the amount and composition of large populations of firms on a regional or national level. In this paper, a micro level approach is applied. For a group of 2,000 firm establishments in the Netherlands, changes in existence, names, locations and network participation for individual firm establishments are recorded and examined from year to year for a period of 5 years (1998-2003). The results show that after five years, 30% of the firms have closed down altogether and another 16% has moved to a new location. Also, 5% of the firms have adopted a complete new name. The micro level changes in the economic landscape are therefore impressive. This study confirms the 'liability of age' rule: older establishments have a lower risk of closing down; also, older firms relocate much less often than younger firms. The firm death rate is related to the urbanization level of the business environment, as larger cities experience higher firm death rates than rural areas. Firms on average reach the age of 18 years, but the deviation around this average is considerable. The majority of firm relocations is over short distances. Although the observable dynamism in the economic landscape is considerable, it can be assumed that the underlying organisational internal dynamics – in organisational structures, in production processes, in production factors and in management, to name a few – are even more impressive. The study of such more non-visible firm internal factors could help explain the visible changes in the economic landscape. Key words: demography of firms, firm dynamics, firm deaths, firm relocations, firm names, firm networks 1.
Introduction: Aims of this
paper Most empirical studies on business sector dynamics use aggregated data: data on the total number of firms in a spatial entity (e.g., a country or a regional subdivision such as a province), or data on the absolute number of firms characterized by a certain type of spatial-economic behaviour or event. By this token, it is known from Anul VIII, nr. 16
the databases of the Dutch Chamber of Commerce that the Netherlands contained 895,276 firm establishments at the beginning of 2001; in the course of that year, over 94,000 new firms started their business whereas almost 55,000 firms went out of business (Huisman & Van Wissen, 2005). Thus, for every 1,000 establishments existing at the beginning of the year, 61 firm deaths and 105 firm births were registered, resulting in a positive balance of iunie 2005
74 44 establishments and a net growth rate of 4.4% for the year 2001. All regions in the Netherlands experienced a positive net growth rate in the number of establishments, although strong regional variations could be noted (ranging from 1.7% in the region of Zeeuwsch-Vlaanderen to 6.8% in Flevoland) (Huisman & Van Wissen 2005). The databases used to generate such macro indicators do not allow for more extended or detailed data mining. For example, how many of the firms started in the year 2001 show up in the firm death numbers over 2002 or 2003? Can regularities be found in the group of firm deaths? Are younger or smaller firms more likely to go out of business than older or larger firms? Is the death rate amongst branch plants or subsidiairies higher or lower than that of other firms? Is a firm relocation an once in a lifetime event, or do certain firms relocate frequently? This paper presents a micro perspective by analysing, on the level of individual units, the fortunes of a sample of 2,000 firm establishments in the Netherlands between 1998 and 2003. It is on this detailed level that changes, both in form and function, in the economic landscape can be observed. New buildings for shops, offices, distribution centres or production units are built; existing buildings for businesses are expanded, renovated, replaced or abandoned. Other structures loose their business function to other functions, or experience a change in ownership or type of business. New firm name signs appear on facades as well as in the official firm registers. Once independent establishments become part of a multi-location organisation by either establishing a branch or subsidiary, or by being taken over by Anul VIII, nr. 16
Jurnalul Economic another organisation with the result that the once independent status of the establishment changes into a subsidiary status. More often than not, the name and appearance of the branch establishment change as part of the process. The net result of the visible changes in the economic landscape are captured in photographs of commercial or retail streets taken from the same perspective on two different moments in time. Although such snapshots are presented primarily for reasons of nostalgia, they do reveal that in only a few decades the composition, structure and appearance of streets can change completely. Should those two photographs be accompanied by more pictures taken at regular time intervals, the dynamic nature of especially commercial streets would become even more evident. This paper aims to develop an understanding of the micro-level changes in the Dutch economic landscape by, first, examining a number of key events in a sample of 2,000 firm establishments: 1. firm deaths and firm survivors: how many establishments went out of business? how many establishments managed to survive? 2. firm relocations: how many establishments have moved to a new location? how often? where to? 3. change of network status: how many establishments experienced a change in their network status – distinguishing between single establishments, headquarters of multi-location organisations and branch locations of multilocation organisations. 4. changes in firm names: how many firm esablishments have changed their names completely or partially? iunie 2005
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Jurnalul Economic Secondly, it is the aim of this paper to relate the abovementioned forms of firm dynamics to one another and to a few available firm characteristics, notably age of the establishment and type of location (urban versus rural). 2.
Demography of firms
The topic of this paper can be positioned in a relatively new methodological approach to regional economic dynamics, known as "demography of firms" (Van Dijk et al. 1999; Pellenbarg & Van Steen 2003a, 2003b). The demography of firms approach studies the structure and development of populations of firms in the same way demographers analyse what happens in populations of people by focusing on trends in fertility, mobility and mortality. Basically, the demography of firms approach seeks to utilise and translate concepts and research methods from the field of population demography in order to understand past, present and future changes in the number, composition and other relevant spatial-economic features of a localised group or 'population' of firms. In the demography of firms approach, firms are seen as living organisms, subject to processes like birth, growth, selection, ageing, illness and death. This view is not completely new. Already in the 1970s, Hannan and Freeman discussed the field of 'organisational ecology' as a way to analyse sociological aspects of organisational change using particular models drawn from population ecology (Hannan & Freeman 1977; Hannan & Freeman 1989). The biological analogy of firms with people has semantical and conceptual Anul VIII, nr. 16
problems as well as limitations. Ekamper and Van Wissen (1994) hold the view that the resemblance between the demography of people and the demography of firms allows useful application of various techniques from the former; at the same time, they comment, the differences between the two fields are numerous. Nevertheless, the use of biological metaphors to refer to certain features of business has already a long record in many languages and has been incorporated in daily speech. The English term 'parent company', for example, exists as moederbedrijf ('mother firm') in Dutch and Firmenmutter ('firm mother') in German. (Note that the English term is sexneutral, as opposed to its Dutch and German counterparts). The use of metaphors, biological or otherwise, as an instrument in the study of economically and spatially relevant aspects of firm behaviour or firm dynamics need not be belittled. Economic geographers and others have used metaphors at many occasions. Birch (1987), for example, applied the analogy of an economic thundercloud to describe the growth, shrink, and entry and exit processes in the total population of firms in the United States. In general, the use of metaphors can be helpful in both research and policy implementations. Blankert (1984) labels metaphors as 'indispensable links between old and new knowledge'. Krugman refers to metaphors as "a kind of heuristic modelling technique" (1995: 79). 3. Unravelling the metaphor: key events in the Dutch demography of firms
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76 Population demography considers birth and death as the most important events in a human life. These events are also important in the demography of firms approach, where the event of firm migration (relocation) is traditionally added as a third key event because of its important spatial dimension. Firm birth The interest in firm births owes much to a number of studies published in the 1980s, triggered by "The job generation process" by David Birch in 1979. In this landmark work, Birch unravelled the components of economic change in the United States during the 1970s and found that, quite contrary to the common view at the time, middle-sized and large firms contributed relatively little to the overall growth of employment. Two thirds of all new jobs generated in the USA were created by small firms with less than 20 employees. Subsequent studies revealed more or less similar findings. For The Netherlands, Wever (1984) was the pioneer in empirical research on new firms. The birth rate figure in the Netherlands in recent years is more or less constant at the 10% level (VVK 2002). This figure includes both 'real' start-ups (firms started by persons not yet active as entrepreneurs) as well as new branches and subsidiaries of existing firms. A cross-national study by Reynolds et al. (1994) shows that most firm birth rates in the European Union are to be found in the 7 to 16% range, but regional birth rates demonstrate a somewhat larger variation between 5 and 20%. The pattern of regional birth rates in the Netherlands shows high figures for the most urbanised regions around AmsterAnul VIII, nr. 16
Jurnalul Economic dam (including the fast growing city of Almere), Rotterdam and The Hague. These regions are characterized by a heavy concentration of business services. New firm formation is also high in the urbanized region around Groningen in the Northern part of the country (Pellenbarg and Van Steen 2003b). This situation confirms the conclusion of Reynolds et al. (1994), who find that in most countries high firm birth rates are to be explained by growth in demand, a large amount of small firms, and a high degree of urbanization. Firm death In population growth figures, birth figures are balanced by death figures (and, in a spatial context, also by emigration and immigration figures). The firm death rate for the Netherlands is approximately 6%, which is low by international comparison (Ekamper 1996, Pellenbarg & Van Steen 2003b). Not always do firm deaths result in an abrupt stop of economic activities or in job loss for the involved employed persons. If a branch plant is closed down but all of its productive capacity including employment is relocated to one or more other establishments, the 'loss' is purely administrative and limited to just one establishment in the statistics. Bankruptcy of a firm is in many occasions followed by the startup of a new firm taking over the (altered) name and all or many production tools and workers. These re-starts are, of course, unknown to the world of population demography. Also, the life span of people has an important time-dimension, determined by biological processes. Firms, however, can become quite old. One of the oldest firms in the world is Sweden based Stora; in 1998, Stora merged with Finnish Enso Oyj iunie 2005
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Jurnalul Economic to form StoraEnso, one of the worlds largest producers of forest products (www.storaenso.com). The roots of Stora go back to late 13th century (Heij 1997). Despite such almost endless timehorizons, firms in the developed world on average reach the age of 12 years (De Geus 1997). Firm migration A third important facet of regional economic dynamics is firm relocation. This is a phenomenon well studied amongst economic geographers. A complex set of factors originating in firms themselves, attributes of their absolute or relative location and aspects of the supply of other (alternative) business sites determine firm relocation. These three categories of variables are referred to as internal push factors, external push factors and pull factors, respectively (Lloyd & Dicken 1977).
For the Netherlands, the Chambers of Commerce reported an annual firm migration of 6 to 7% in the 1980s and 7 to 8% in the 1990s (Pellenbarg & Kemper 1999), which puts firm relocation numberwise inbetween the birth death rate of 6% and the firm birth rate of 10%. Most of the relocated firms are growing firms; most of the firm relocations take place over relatively short distances (Pellenbarg & Van Steen 2003b). The total population of firms in the Netherlands changes very gradually from year to year (cf. figure 1). Between 1998 and 2003, the number of firm establishments increased from 760,000 in 1998 to 773,000 in 2003, which equals an increase of 1.7% (Note that figure 1 presents data on numbers of firms which slightly differ from the abovementioned Chamber of Commerce figures).
785 780 775 770 x 1,000
765 760 755 750 1998 1999 2000 2001 2002 2003
Figure 1: Number of firm establishments in the Netherlands, 1998-2003. Source: CBS, Statline, various years. Anul VIII, nr. 16
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4. Unravelling macro data by using micro data As was noted in the introduction, the macro data presented in the previous section do not allow for the examination of possible relations between firm demographic key events in one year with those in the next year. Also, relations with other features internal and external to the firm are not possible. In order to come to a deeper understanding of firm dynamics, a sample of 2,000 firm establishments was drawn from the register of the Chamber of Commerce in 1998. Only 'economic active' establishments were included in the sampling frame. For each of these establishments, a number of variables were exported from the database, or compiled on the basis of these primary variables: official name of the firm establishment in the Chamber of Commerce register; the unique registration code, consisting of an eight digit main number and a four digit subnumber. This registration code can be used to determine the network status of the firm establishment: 1. a single, independent establishment (unique main number – the main number does not appear elsewhere in the register of the Chamber of Commerce), 2. the headquarter location of a multi-location organisation (main number shared with subsidiairies, but unique subnumber '0000'), 3. the subsidiary establishment of a multi-location organisation (unique subnumber with common main number); year in which the firm was established, in order to determine firm age; Anul VIII, nr. 16
Jurnalul Economic location of the establishment (address, zipcode, name of town or city; official code for municipality, used to determine degree of urbanization – see below); type of business sector. Exactly one half of the 2,000 establishments were drawn from municipalities classified as 'strongly urbanized', whereas the other 1,000 establishments were drawn from 'rural' municipalities. These two classes form the two ends of a five class division of Dutch municipalities according to the so-called address density. The 'strongly urbanized' municipalities are characterized by 2,500 or more addresses per square kilometre; the 'rural' municipalities have on average less than 500 addresses per square kilometre. For the former group, we selected the 10 municipalities with the largest population size; for the latter group, the 20 municipalities with the smallest population size. The ten largest cities of The Netherlands, all in the 'strongly urbanized' group of municipalities, are Amsterdam, Rotterdam, The Hague, Utrecht, Eindhoven, Tilburg, Groningen, Breda, Apeldoorn and Nijmegen. For each of these cities, we drew a random sample of 100 establishments; for each of the twenty 'non urban' (rural) municipalities, we drew a random sample of 50 establishments. The 'urban' versus 'rural' distinction was inspired by the intention to test for the existence of differences between urban and rural business environments. Davelaar & Nijkamp (1984), for instance, have suggested that urban areas operate as incubators for the establishment of new firms, suggesting that urban areas will be characiunie 2005
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Jurnalul Economic terized by higher firm birth rates compared to rural areas. Ekamper (1996) adds that urban areas with high firm birth rates are also characterized by high firm death rates. High entry rates are thus related to high exit rates (Brouwer & Van Wissen 2005). Studies of firm relocations and location factors for firms have revealed that larger cities are characterized by firm relocation processes from the inner city area and older residential neighbourhoods adjacent to the inner city to the outskirts of the town, to new industrial parks and highway locations (Van Steen 1998). Agglomeration diseconomies in urban areas will set in motion higher number of firm relocations compared to non-urbanized or modestly urbanized areas (Richardson 1995). Our sample of 2,000 firm establishments is, despite a small underrepresentation of wholesale companies (12% in our sample, 15% in the population), a good reflection of the sectoral breakdown in the population of the 829,000 establishments in 1998. Also, the share of independent establishments (89%), branch locations (8%) and headquarters (3%) is a perfect reflection of the composition in the population. Over half (53%) of the establishments in our sample is younger than 10 years old. On average, the 2,000 establishments are 18.2 years old. Firms located in rural municipalities are on average 5 years older than firms in urban areas (21 versus 16 years). 5.
2000 Firms, 5 year later
Five years after our sample of firm establishments was constructed, precisely 600 or 30% of the 2,000 establishments have disappeared from the economic landAnul VIII, nr. 16
scape. Another group of 326 firms occupied a different location in 2003. This is 16% of the 1998 sample, or 23% of the 1,400 surviving firm establishments in 2003. Another visible aspect of changes in the economic landscape are the names that firms use to present themselves. Of the 1,400 establishments still in existence after the five year period of our examination, 82% are registered using exactly the same name as in 1998. Three categories of name changes can be distinguished: 1. minor name changes: corrected misspellings, or small additions in the name of the firm (e.g., "Leo van der Kroft Paintworks" in stead of "Leo van der Kroft", or "Jansen & De Vries Inc." in stead of "Jansen & De Vries"). 2. major name changes: the name of the firm has changed considerably, but part of the changed name is still recognizable from the previous name (e.g., "Henny Kramer Fashion Clothing" in stead of "Fashion Kramer"). 3. complete name changes: the firm has adopted a complete new name (e.g., "Dream Lounge International Gallery" in stead of "Dr. Who?", or "Barn's Harleyshop" in stead of "J.A.M. Pieper"). From this overview we can conclude that the amount of dynamics in our sample in the five year period 1998-2003 is impressive: 30% of the 2,000 establishments have disappeared completely; 16% of the firms relocated to another location; and 7% of the firms adopted a complete new or strongly changed firm name. After five years, only 46% of the original 2,000 establishments are still in operation on the same address as in 1998 and with more or less the same firm name and the same iunie 2005
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network status (independent, subsidiary or headquarter). In the next three sections, the events of firm deaths, firm relocations and changes in network status will be examined more closely. Special attention will be given to the existence of relationships between the spatial-economic dynamics in our sample group and firm age and type of business environment. 6.
Firm exits
Between 1998 and 2003, 600 or 30% of our 2,000 establishments in the study group disspeared from the economic landscape. For the first four years of our analysis, every year more or less the same amount of firms went out of business: 7.5% of the amount of firms in the previous year. This is somewhat higher than the 6% firm death rate for the whole population of Dutch firms, as reported by Ekamper (1996). Higher than average death rates occur in the sectors of business services (35%) and wholesale (33%), in urban areas (35%), amongst young firms (40% in the age group of younger than 5 years in 1998), amongst branches (42%), in multilocation organisations with only one headquarter and one branch (62%), amongst branches with the headquarters in the same city or town (60%) and amongst firms that have not relocated in the 1998-2003 timeframe (33%). Lower than average death rates occur in the agricultural and industrial sectors (17%), in rural areas (26%), amongst middle-aged firms (age 11 to 40 years in 1998, 21%), in large multi-plant organisations with more than 50 branches Anul VIII, nr. 16
(12%) and amongst firms that relocated between 1998 and 2003 (18%). Subsidiaires demonstrate a higher chance of being closed down then headquarters or independent firms. The death rate for subsidiaries is 42%, compared to 27% for non-subsidiairies. These findings are in line with those of Caves (1998) for industrial firms. Of the 1,400 surviving firms, 3% has a different network status in 2003 compared to 1998: 23 originally independent firms became part of a multi-location organisation (6 of these became a subsidiary; 17 of these became a headquarter because a subsidiary was established elsewhere); 19 establishments that were part of a multi-location organisation in 1998, transformed into an independent establishment in 2003 The average age of firms leaving the economic landscape is 18 years, whereas the median age is 8 years. The comparison of these two figures indicates that the majority of the disappeared firms shuts down at a young age. Indeed, close to 60% of the firms was younger than 10 years of age at the time of their exit; 20% of the firms reached an age between 10 and 20; 13% of reached an age between 20 and 50. Only 10% of the firm establishments was older than 50 years at the time of their dissolvement. All in all, young firms have a higher risk of loosing the battle for survival. Of the firms established ('born' in the terminology of the demography of firms approach) in 1998, a slight majority (54%) was closed down in or before 2003. Of the firms in the age group 0 to 5 years in 1998, a total of 40% has disappeared from the economic landscape in 2003. iunie 2005
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Jurnalul Economic Figure 2 presents the age specific death risk of the firm establishments in our sample. The curve clearly demonstrates that how older an establishment gets, how lower the risk of firm death is. In the first year of existence, the death risk is about
12%; in the tenth year of existence, the death risk has halved to about 6%. This 'liability of age' is one of the well known death risks in the demography of firms (cf. Baldwin 1995).
Figure 2: Survival curve of firm establishments, 1998-2003 The death rate amongst firms located in rural municipalities (25.6%) is significantly lower than amongst firms located in the group of ten largest strongly urbanized areas (34.4%). At the same time, the average age at dissolvement is 23 years for firms located in rural areas against 14 years in urban areas. These differences can be explained by the fact that rural areas are characterized by low, and urban areas by high firm birth rates. Because of the much higher birth rates amongst younger firms, firm death rates in the largest cities are higher than those in rural areas. 7.
Firm relocations
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The annual firm relocation rate in our sample varies from 5.3% to 6.3% (table 1). These findings are in line with firm relocation rates found in other studies for the Netherlands for the mid and late 1990s (cf. Pellenbarg 2005). All in all, 20% of the 2,000 establishments in our study relocated – 16% relocated once, 4% relocated more than once. The relocation rate is lower than average in the hotel, bar and restaurant sector (8%) and amongst agricultural firms (9%). The business service sector demonstrates an above average share of firms that have relocated (28%). Firm relocation rates are low amongst subsidiaires (7.5%) but high amongst headquarters (27%).
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Jurnalul Economic Table 1: Firm relocation dynamics, 1998-2003.
(A) number of surviving firms
1999 2000 2001 2002 2003 1851 1714 1582 1463 1400 116
101
108
87
77
(C) relocation rate: (B) as % of number of surviving years 5.8 previous year %
5.5 %
6.3 %
5.5 %
5.3 %
(B) number of firms moved since previous year
The firms that moved between 1998 The relocation of a firm often goes and 2003 (and still existed in 2003) on avhand in hand with a name change: of the erage moved 1.25 times – out of every four firms with a major or complete name moved firms, on average one firm moved change, close to 40% have relocated to a twice in the five year period considered. new location in 2003 (compared to 21% of Also, the data show that the firm death the firms with an identical name in 2003). rate amongst firms that never moved after 1998 is 33%, compared to only 18% of 8. Organisational networks amongst firms that experienced a relocation after 1998. Firm relocation, then, can As already noted, the firm death rate be seen as a sign of firm vitality. amongst subsidiaries is high (42%). In conThe majority of firm relocations are trast, only 27% of the headquarters and over (very) short distance. Twothirds of all 29% of the independent establishments relocated firms move from one location to dissolved between 1998 and 2003. Many another location within the same municiclosed subsidiaries are relatively young: pality. Only one in every seven firms move close to 60% of the disappeared branch to one of the other eleven provinces within establishments were younger than 5 years the Netherlands. Only 14 establishments, old in 1998. The death rate amongst head or 3.5% of all relocated firms, have moved offices located in the larger cities is much to another, non-adjacent province. higher (33%) than the death rate amongst Most relocating firms are young: head offices in rural municipalities (16%). half of the business units that moved beThe death rate of subsidiaries is retween 1998 and 2003 were younger than 5 lated to the size of the organisational netyears of age in 1998. Only 15% of the work (i.e., the total number of establishmoved firms is older than 20 years. These ments in that network). Branches belongfindings correspond with other studies. ing to network with a high number of esVan Steen (1997), for example, found that tablishments have a lower chance of being firm establishments that have not moved closed down than branches in small netin the first 20 years of their business life, works (cf. table 2). are unlikely to move in subsequent years. Table 2: Survival rates of subsidiaries and size of networks, 1998-2003 size of organisational network in 1998 (no. of estab- no. of no. of sur- survival Anul VIII, nr. 16
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Jurnalul Economic lishments, including head office) very small: 2 establishments small: 3, 4 or 5 establishments medium: 6 to 50 establishments large: 50 or more establishments all subsidiaries The high death rate of branches in very small networks (one head office, one branch) could be explained by the merging of activities that originally toke place in two locations into one single location. In other cases, it could simply have been unprofitable to maintain a branch establishment. The low death rate of branches in large networks suggests that individual branches in such large networks are less vulnerable; it could well be that less profitable branches are kept "alive" by other, more profitable branches in the same network. Small organisational networks, with only one or a few branches, have a strong
branch locations in 1998 65 39 35 34 173
vivors in 2003 25 19 26 30 100
rate 19982003 38 % 49 % 74 % 88 % 58 %
local or regional character. For the majority (67%) of the very small networks (one head office, one branch), both establishments can be found in the same province (The Netherlands consists of 12 provinces). This is in sharp constrast with the large networks (50 or more establishments), where only 9% of the branch locations included in our sample have their head office located in the same province. The high firm death rate in (very) small organisational networks, as captured in table 2, is related to high firm death rates in locally or regionally organized networks (table 3).
Table 3: Survival rates of subsidiaries and distance to head office, 1998-2003 location of head office of branch no. of branch no. of survivors survival rate considered (in 1998) locations in 1998 in 2003 1998-2003 in same municipality 47 19 40 % elsewhere in same province 27 15 56 % elsewhere in same region (*) 23 15 65 % in other region (*) 67 45 67 % unknown 9 6 67 % all subsidiaries 173 100 58 % * we distinguish 4 regions: North (provinces of Groningen, Friesland, Drenthe), East (Flevoland, Overijssel, Gelderland), West (North Holland, South Holland, Utrecht), South (Zeeland, Noord-Brabant, Limburg) Between 1998 and 2003, 60% of the branch establishments with a head office in Anul VIII, nr. 16
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in another region in the country. The chance of survival of subsidiaries with head offices located at greater distance is therefore larger. However, there is a strong correlation with the size of the network: 'head office at larger distance' is strongly correlated to 'large network' (table 2). 9.
Conclusions
Firm dynamics is to be interpreted as a form of adaptation to changing circumstances (Pellenbarg et al. 2005). Two schools of thought can be distinguished here. The organisational ecology school (cf. Hannan and Freeman 1989), which focuses on the internal structure of organisations, holds the view that individiual firms are not well equipped to adapt to circumstances. The population of firms adapts primarily through the process of natural selection (firm births and selective firm deaths). The evolutionary economy school of thought does not deny the importance of selection processes, but also states that firms can adapt to changing circumstances by means of innovations and organisational changes. Next to firm births and firm deaths, evolutionary economists therefore also focus on growth and shrink, mergers, spin-offs and firm relocations as forms and strategies of organisational change. The analyses underlying the presentation in this paper demonstrate that at the micro level a considerable amount of dynamism and adaptation to changing circumstances can be observed in the Dutch economic landscape. After 5 years, almost half of the establishments can not be traced at their original location with their original name. Three out of every 10 estabAnul VIII, nr. 16
lishments have dissolved; another 16% has moved to another location; and 5% of the firms have changed their name. The most important dimensions of this study of firm dynamics can be summarized as follows. 1. The death risk of establishments diminishes as firms grow older. This insight is not new, but the material used for this paper confirms this rule firmly. The death risk in larger cities is higher than in rural municipalities of the Netherlands. 2. On average, business establishments reach the age of 18 years. The distribution around this average is considerable. 3. Every year, 5 to 6% of the firm establishments move to another location. This relocation chance is related to age: older firms have a lower relocation chance. 4. Most firm relocations are moves over short distances: 60% of the firm moves is within the municipality, 20% is to another municipality in the same province. One out of every 14 firm relocations is to another – mostly: neighbouring – province. 5. Firm relocation is an indicator of firm vitality: relocated firms have a significant lower chance of closing down in the first few years following the relocation. 6. A considerable amount of firms change their name. Firm relocations are an important reason for a firm to chance it's name. 7. Almost 9 out of every 10 establishments in the Netherlands are independently operating single firms. Branch establishments almost never relocate, but do have a high risk of dissolvement. Firm death rates amongst branches are very high in very small networks; young subsidiaries iunie 2005
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Jurnalul Economic also are characterized by high death rates. Young branch establishments are therefore a vulnerable group in the business landscape. The analysis applied in this paper has one shortcoming. A reliable variable indicating the size of the establishment, and the change in this size, was not available. It can be assumed that growth and shrink processes, for example in numbers of employees, are strongly related to firm demographic events of exit and relocation. In more general terms, understanding and monitoring of firm internal variables can help predict – and, from a policy point of view, perhaps help prevent negative outcomes of – the more visible dynamics reported in this paper (cf. Hall 1987, Van Steen 1993, Pen 2002). Nevertheless, the amount of firm dynamics observed above is without doubt magnified by an even larger amount of firm internal dynamics. Behind the walls that separate the firms from the outside world, complex interrelated systems of production factors are to be found – in essence: labour, capital and know-how. The level of visible dynamics in the economic landscape is even surpassed by large amounts of dynamics in terms of labour growth, labour shrink, capital investments and divestments and increase or decrease in the efficiency of utilizing human capital. In other words: when an even stronger magnifying glass is applied, the amount of dynamism observed increases. References: Baldwin, J.R. (1995), The dynamics of industrial competition. Cambridge, Mass.: Cambridge University Press. Anul VIII, nr. 16
Birch, D.L. (1979), The job generation process. Cambridge, Mass.: Cambridge University Press. Blankert, J.W. (1984), Over metaforen en wetenschap. In: Economisch Statistische Berichten 69 (3468), p. 754-755. Brouwer, A. & L. van Wissen (2005), De jaren tellen al vroeg mee: demografische aspecten van opheffingen. In: P. Pellenbarg, P. van Steen & L. van Wissen (eds.), Ruimtelijke aspecten van de bedrijvendynamiek in Nederland. Assen: Van Gorcum, p. 127-140. Caves, R.E. (1998), Industrial organization and new findings on the turnover and mobility of firms. In: Journal of Economic Literature 36, p. 1947-1982. CBS (various years), Statline. www.cbs.nl Davelaar, E.J. & P. Nijkamp (1984), De stad als broedplaats van nieuwe activiteiten. In: Stedebouw en Volkshuisvesting 67 (2), p. 61-66. Dijk, J. van, P.H. Pellenbarg & P.J.M. van Steen (1999), Determinants of firm migration in the Netherlands. An exercise in the demography of firms approach. In: J. van Dijk & P.H. Pellenbarg (eds.), Demography of firms. Spatial dynamics of firm behaviour. Utrecht/Groningen: Koninklijk Nederlands Aardrijkskundig Genootschap/Faculteit der Ruimtelijke Wetenschappen Rijksuniversiteit Groningen. Nederlandse Geografische Studies 262, p. 87-121. Ekamper, P. (1996), Opheffing van bedrijfsvestigingen: een sterftetabel benadering. In: Planning, Methodiek en Toepassing 48, p. 12-21. Ekamper, P. & L. van Wissen (1994), SIMFIRMS: Firmografische miiunie 2005
86 crosimulatie van bedrijfsvestigingen in Nederland. Deel 1: Theorie en beschrijving. Den Haag: Nederlands Interdisciplinair Demografisch Instituut. Geus, A. de (1977), The living company. Cambridge, Mass.: Harvard Business School Press. Hall, R.H. (1987), Organizations. Structures, processes & outcomes. Englewood Cliffs, N.J.: Prentice-Hall Inc. Fourth edition. Hannan, M.T. & J. Freeman (1977), The population ecology of organisations. In: American Journal of Sociology 82, p. 929-964. Hannan, M.T. & J. Freeman (1989), Organizational Ecology. Cambridge, Mass./London: Harvard University Press. Heij, J.-J. (1997), Bedrijven sterven te snel. In: Intermediair 33 (15). Huisman, C. & L. van Wissen (2005), 'Facts and figures' van de demografie van bedrijven in Nederland. In: P. Pellenbarg, P. van Steen & L. van Wissen (eds.), Ruimtelijke aspecten van de bedrijvendynamiek in Nederland. Assen: Van Gorcum, p. 11-38. Krugman, P. (1995), Development, geography and economic theory. Cambridge, Mass./London: The MIT Press. Lloyd, P.E. & P. Dicken (1977), Location in space. A theoretical approach to economic geography. London etc.: Harper & Row. Second edition. Pellenbarg, P. (2005), Bedrijfsverplaatsingen. In: P. Pellenbarg, P. van Steen & L. van Wissen (eds.), Ruimtelijke aspecten van de bedrijvendynamiek in Nederland. Assen: Van Gorcum, p. 101-125. Pellenbarg, P.H. & N.J. Kemper (1999), Industrial mobility in the Netherlands: patterns, causes and impacts for spaAnul VIII, nr. 16
Jurnalul Economic tial policy. Groningen: SOM, University of Groningen. SOM Research Report 99D34 Pellenbarg, P.H. & P.J.M. van Steen (2003a), The demography of firms in the Netherlands: introduction to the 2003 maps. In: Tijdschrift voor economische en sociale geografie 94 (1), p. 144-146. Pellenbarg, P.H. & P.J.M. van Steen (2003b), Spatial perspectives on firm dynamics in the Netherlands. In: Tijdschrift voor economische en sociale geografie 94 (5), p. 420-430. Pellenbarg, P., P. van Steen & L. van Wissen (eds.) (2005), Ruimtelijke aspecten van de bedrijvendynamiek in Nederland. Assen: Van Gorcum. Pen, C.J. (2002), Wat beweegt bedrijven. Besluitvormingsprocessen bij verplaatste bedrijven. Groningen: Faculteit der Ruimtelijke Wetenschappen RuG. Nederlandse Geografische Studies 297. Reynolds, P.D., D.J. Storey & P. Westhead (1994), Cross-national comparisons of the variation in new firm formation rates. In: Regional Studies 28, p. 443456. Richardson, H. (1995), Economies and diseconomies of agglomeration. In: H. Giersch (ed.), Urban agglomeration and economic growth. Berlin etc.: Springer Verlag, p. 123-155. Steen, P.J.M. van (1993), Rendement en ruimte. Bedrijfsrendementen in een ruimtelijke context. In: P.J.M. van Steen (ed.), Geografie in beweging. Liber amicorum Pieter Lukkes. Utrecht/Groningen: Koninklijk Nederlands Aardrijkskundig Genootschap/Faculteit der Ruimtelijke Wetenschappen Rijksuniversiteit Groningen. Nederlandse Geografische Studies 167, p. 123-145. iunie 2005
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Jurnalul Economic Steen, P.J.M. van (1997), Bedrijfsgrootte en ruimtegebruik van ondernemingen in leeftijdsperspectief. Groningen: Faculteit der Ruimtelijke Wetenschappen Rijksuniversiteit Groningen. Onderzoek en Advies 83. Steen, P.J.M. van (1998), Bedrijvenlandschap 2000+. Bedrijfsverplaatsingen en de vraag naar bedrijfslocaties in Nederland. Groningen: Faculteit der Ruimtelijke Wetenschappen Rijksuniversiteit Groningen. Onderzoek en Advies 85.
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Steen, P.J.M. van (2005), Bedrijvendynamiek onder het vergrootglas. In: P. Pellenbarg, P. van Steen & L. van Wissen (eds.), Ruimtelijke aspecten van de bedrijvendynamiek in Nederland. Assen: Van Gorcum, p. 39-64. VVK (2002), Bedrijvendynamiek 2002. Woerden: Vereniging van Kamers van Koophandel. Wever, E. (1984), Nieuwe bedrijven in Nederland. Assen: Van Gorcum.
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The urban micro region: Deva - Hunedoara - Călan - Simeria Professor Silviu Neguţ, PhD. Lecturer Liviu Bogdan Vlad The article approaches the “Deva - Hunedoara – Călan - Simeria” urban micro-region, from a development perspective, analysing its background and its contemporary evolution from the point of view of the economy, of the population and of the geo-historical landmarks and traditions, and based on this analysis, concludes in the drawing-up of some guidelines for its future functioning. Key words: urban micro-region; human geography. 1.
The urban anteriority
The Hateg - Orastie depression, distinct entity within the space of the Southern Carpathians presents a wide opening towards the valley of the main river of Transylvania, the Mures river, through the valleys of the Strei and Cerna rivers. Within the Hateg – Orastie depression, the Călan Corridor and the Hills of Hunedoara singularise. Within this space, an urban form with specific features has come into being, practically, an urban micro-region, within which the position of the four cities (Deva, Hunedoara, Călan, Simeria) stands out bearing a nearly perfect rectangular symmetry. The four cities are singularised as urban settlements ever since the DacianRoman ancient times and have preserved this statute until modern times. The main factor they benefited from throughout their long historical evolution has been their geographical, in this case, geohistorical position. As such, they present to this day, a territorial configuration through which a functional unity asserts itself Anul VIII, nr. 16
thanks to: the administrative-political situation of the Deva city (a district residence), the major industrial centre of Hunedoara, the Simeria railway junction and the complementary industrial centre of Călan. Two of these human settlements, respectively Hunedoara and Deva, are situated within the area of the Hunedoara Hills, in the proximity of some iron ore deposits exploited ever since the getodacian period. On the other hand, Simeria and Călan excel through their situation which crosses the ancient connection roads to the former capital of Dacia (Sarmizegetusa Regia) and to the dacian and roman influenced cities from the valley of the Mures River, which are situated along the commercial road towards the former deployment of Colonia Splendisima Porolisum, recognised from the Hills of Moigrad in the Salaj region. It is interesting to state out the fact that among the Romanian Carpathians within which the analysed region is enframed, the historical hearths of the settlements have been, thanks to the resources of the subsoil, permanent funciunie 2005
90 tional hearths, perpetuated afterwards throughout all historical eras until today. It is not by accident that within this region, both the capital of the Dacian state (Sarmizegetusa Regia), as well as that of the Dacian roman province (Sarmizegetusa Ulpia Traiana) were set up. Between these two poles, within the Romanian space, that quasi-administrative (political) form, known as “The Land of Hateg” asserted. As a matter of fact, the strategy of the bipolarity Sarmizegetusa Regia vs Sarmizegetusa Ulpia Traiana has determined, to a great extent, the constancy of the roman administration, on one hand, and the provision of ingression into the areas that presented a geo-strategic and economic interest, mainly, the gold mines in the Apuseni and Banat Mountains, on the other. Such a strategy has obviously favoured ever since Antiquity, the emergence of some nuclei of the urban persuasion, which can be found today among the inventory of the Roman camps, and respectively of the later medieval forms. These evolutions have been concurrently favoured by the quality of the resources form the adjacent (Carpathian) areas of this urban quadrangle. The area, in its whole, has maintained a healthy environment for the agric-pastoral activities, situation propitious to the development of the human settlements, in general. Also, the urban forms emerged here have attracted other resources into the productive circuit: mainly iron ores, from which, the urban centre of Hunedoara especially benefited however, later on. 2. Contemporary evolutions The necessity for developing and expanding the modern communication ways, correlated to the regionalAnul VIII, nr. 16
Jurnalul Economic administrative role of the city of Deva have stimulated Simeria to become a railway centre of regional and even national importance. In its turn, the functional amplification of the Hunedoara centre has favoured the industrial complementary stimulation of the city of Călan. Therefore, ever since the beginning of the industrial development period, an urban equilibrium has been outlined, through which an urban formation of a unique persuasion, was configured, the urban micro-region of Deva - Hunedoara - Călan - Simeria, characterised by: • Limited spatial association of a significant number of cities • Functional diversity within this limited space • Convergence area within which the dacian fundaments coalesce and not lastly, the roman encrypted significations • The frequency of some unique resources (ex. iron) Important shifts may be noticed, however, especially after 1970. It is the moment when the industrial position of the cities of Călan6 and Hunedoara is nationally asserted. Hunedoara, therefore becomes between 1950 and 1970 the largest and most important iron and steel centre of Romania. In the following times, respectively after 1980, one may remark a diversification of the industrial resources and their distribution towards the near cities, respectively towards Călan (the new coke6
The statistics of the time shows that the iron and steel centres of Hunedoara and Călan reached to produce 166 times more steel and repectively 11 times more pig iron than in 1950, in Romania.
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chemical foundry) and towards branches and structures within the settlements netof apparent local interest, but actually, of works from the area and especially among national level, such as the great thermoethose settlements positioned in the valleys lectric power station of 1000 MW from of the Strei, Cerna and Mures rivers. SiMintia-Deva. The city of Deva, which was meria is endowed with new attributes. known until then due to its administrative In such a process of evolution, the responsibilities, gains complex industrial villages in this region distinguish through a structures, becoming better enframed into higher potential than that of the surroundthe specific of the region, unlike Hunedoing regions, as the cities of Deva, Hunedoara and Călan which can be distinguished ara, Călan and Simeria find themselves tied through a greatly specialised industry. in tight and complex social and economic The excessive industrial developinter-relations, functioning as a true unitary ment has determined functional and urban subsystem. demographic shifts in the existent relations Such elements have determined the assigning of the concept of urban micro-region to this city ensemble, according to its definition as such in the geographical literature7.
DEVA SIMERIA
HUNEDOARA CĂLAN
Distance in km: HUNEDOARA - 20 km - DEVA DEVA - 9 km - SIMERIA SIMERIA - 14km - CĂLAN CĂLAN- 12 km - HUNEDOARA
Fig. 1 – The map of the urban micro-region: Deva-Hunedoara -Călan-Simeria 7
Vintila Mihailescu, Geografie urbana in Romania, BSRG, Human and economic Geography, Bucharest
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The key elements of this territorial urban form, unitary urban subsystem, consist mainly of: The very small distances between cities, respectively 15-20 km The presence of the common features concerning the economic and social aspects, respectively: o Hunedoara and Călan: highly specialised (iron and steel) industrial centres o Deva and Simeria: relatively complex functions o Excessive evolution of the human potential o The complementarity of Deva and Simeria (both, with functional diversity) as opposed to Hunedoara and Călan (which are mono-specialised) o The complementarity of the touristic attractions These are the defining features of the cities from the above mentioned urban quadrangle in the transition period towards market economy.
tants and a surface of 58.83 km 2 . It excels through a functional diversity in a relatively limited space, with branches of national and regional importance. Through its position and its functional tradition it has influenced the railway activity and mainly, it has stimulated the functional amplification of the Hunedoara centre. Deva, through its situation on the left bank of the Mures River, within the space of the interrelations between the Apuseni and Poiana Rusca Mountains, appears as a gate of the analysed area, opening towards the west of the country. Altogether, through its altitudinal situation (187 m) and trough its geohistorical9 sympathies, Deva represents an important centre of tourist attraction. The main point is the Citadel Hill (371 m), a volcanic formation disposed under the form of a conoid, which offers a unique view of the entire valley of the Mures River and of its surrounding areas, and not lastly, of the entire city. On the top of the Citadel Hill lie the ruins of the Deva Citadel, built in the 13th century, during the Mongol invasions.
The allotment of the number of inhabitants of the Hunedoara district on the main cities Orãştie; 22248 Haţeg; 11122
Deva; 69204
Cãlan; 13258
Deva Hunedoara Simeria Cãlan Haţeg Simeria; 13913
Hunedoara; 72422
Orãştie
Deva remains the capital of the
Hunedoara district with 69 2048 inhabi8
According to the National Institute of Statistics 2005
9
Deva is considered to come from the dacian word „dava”, meaning fortress or walled city.
Fig. 2 – The Deva Citadel The development of the city in the following centuries is a consequence of the protection offered by the fortress. As a military and administrative centre, it has played an important role in the history of Transylvania. The initial function of providing services has diversified, as the city became a strong industrial centre. The industrial profile is given by the Mining Factory (The Copper’s Autonomous Administration), Macon (construction materials), Sarmismob (wood processing), Matex (silk weaving mill), the Tire Retreading Factory, units of the alimentary, transport, geological prospecting and exploring industries, etc.
Hunedoara – municipality with a population of 72 422 inhabitants and a surface of 97 km 2 , situated at 18 km southeast of the Deva municipality, is remarked, besides through its industrial position, through its situation in the valley of the Cerna river, at its confluence with the Zlasti bourn. The city is dominated by the industrial area, individualised in its urban structure. It is an ancient economic centre, influenced by the position of the Huniads Castle (14th -15th centuries). Such a position is magisterially picked up from the Chizid Hill, from where the panorama above the entire city opens with its so differentiated functional areas.
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Fig. 3 – The Huniads Castle Hunedoara was, and is to this day, a centre of prioritised importance in the process of urbanisation of the entire region, inducting radical changes in the economic and social profile of the human settlements in the surrounding closer or farther areas. Typically industrial municipality, specialised in the field of the nonferrous metallurgy (The Iron and steel Aggregate Works), Hunedoara has diversified in the past decades its industrial activities, through the functioning of the shoes (“Corvinul”) and runnables (“Metropa”) factories It is a typical example of a distinct hypertrophied evolution in the communist times. After 1990, it continues to function as an industrial centre, favouring, altogether, the tertiary sector, including the tourism one. Călan is the centre of the most ancient historical vocation, attested in the ancient times, known as Aquae, as a wateringclimatic spa with thermal waters, renowned Anul VIII, nr. 16
for treating rheumatic disorders and anaemia; the documentary attestation as a city is found later on, in 1966, due to the industrial development. Therefore, the city amplifies, both from the demographical point of view, but also from the territorial one, counting today a population of 13 258 inhabitants, living on a surface of 101.5 km 2 . Economy is based mainly on the industrial activities, the “Sidermet” Iron and Steel Aggregate Works imposing itself, through the production of grey pig iron, coke and semi-coke, metallurgic equipments, household appliances, etc. Relatively recently, the “Plaster Factory” began functioning. The most acute problem lies in the structure of this city – half industrial and half urban – which is now unbalanced. After the year of 2000, the city faced a profound crisis, due to the closing of the existent factories (the only ones specialised in grey cast iron in the entire Southern iunie 2005
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Jurnalul Economic Europe). The cease of activity and the start of chaotically unrigging the steel and iron platform have caused a “dramatic” landscape, both for the aesthetical condition,
but also for the functional one. A certain development has been known by the services actuated by the evolution of the Călan-Bai resort.
Fig. 4 – Industrial scenery (Călan) Simeria also excels through the old historic vocation, mentioned as Terra episcopalis10. Simeria is known as one of the country’s most important railway (but also road) centres, with an intense traffic of commodities and passengers. Among its economic units (besides the Triage Station) excel the mechanic factory of rolling stock, the “Marmosim” factory (marble and sinter processing), the dairy factory, the lamb breeding complex, etc. Although affected by the restructuring, Simeria holds favourability elements both for the develFig. 5 – The Simeria Dendrology Park opment of the sectors in the tertiary field, but also through the tourism valences it can benefit from. The Dendrology Park here is unique among the structures of the kind in Romania. The variety of species, as well as its age of over 300 years asserts this unique space. 10
Documentary attested in 1276
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3. Perspectives towards the functional articulation of the urban micro-region – the Hunedoara Industrial Park A significant measure, which may constitute a first phase in the functional articulation of this micro-region, is represented by the development of the Hunedoara Industrial Park. This solution makes it possible to stimulate the entire analysed micro-region, which, in the last years has known a contradictory evolution, through the dramatic decrease of the workplaces, which obviously led to a chronic state of unemployment; in order to back up the above statements, we must mention that it was only in that last lay-off wave (from May-June 2003) that over 3500 employees have been put off. The accomplishment of this industrial park has started in the spring of 2003. The surface of the park is 193 000 square metres, split into 26 subdivisions, with surfaces ranging between 2 500 and 10 000 square metres. The so dimensioned surfaces will be able to be patented for a period of 49 years, or to be sold to the entrepreneurs who would wish to invest in the industrial park. The access to the park is made directly from the national road Hunedoara-Deva. The park disposes of complete utilities for any kind of industrial investment, being adequate for the implantation of industrial objectives. Among the competitive advantages that the Hunedoara Industrial Park has to offer to the investors lie: 1. Advantages related to the active population o The existence of workforce well qualified in many fields specific to the extractive and iron and steel industry. The Hunedoara Iron and Steel Aggregated
Works, a giant built after the model of the great iron and steel factories from the French Lorene, or the Ruhr (we remind that this aggregated works has been built in 1837), was in fact, an integrated industrial complex, in which workers of all specialisations co-worked. The tradition has perpetuated to this day, and as such, practically, for each industrial qualification there are well trained workers in Hunedoara and in the surroundings. o Long industrial tradition: Hunedoara is an industrial city of about 200 years, and in Central and Eastern Europe there are few locations that could benefit from such a tradition, as it is a guarantee of the quality of the workforce. o The willingness of the workforce to accept poorer working and salary conditions, willingness accentuated by the growth in the number of people unemployed from the last years. o The malleable character of the workforce: in Hunedoara there were no social conflicts, no strikes, not even during the massive lay offs. o The existence in the city of a university centre and of a qualitative highschool teaching network, able to train the graduates with a high degree of knowledge 2. Geographical and Economic advantages: o The situation at only 7 km from the main European road that crosses Romania (E64). o The position at maximum 20 km from the future highway which will be built on the European transport corridor E4, Budapest-Nadlac-BucharestConstanta, the main corridor that crosses Europe from west to south-east. o The position at 15 km from the existent railway from the E4 transport cor-
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European Union for the adhesion of our country in 2007, all these will make the flux of foreign investments grow in the following period. The administrative society of the Hunedoara Industrial Park is willing to accept investments in very different fields, investments that will obviously generate workplaces. For example, it is expected to have investments for production capacities, such as: a. Electronic components, components for satellite communications, batteries for the mobile phones, electrical installations based on solar energy and others; b. Mechanic constructions and sub-ensembles: sintered metallic products, rough carbide products, hydraulic subensembles, etc; c. Plastics objects d. Wrappers for the alimentary industry, but also for other fields. In conclusion, we may assert that, once with the setting up of the Industrial Park, plus other local and regional projects that are now kept in mind (for example the ones based on the tourism services), the Deva-Hunedoara-Călan-Simeria microregion will gain more and more accentuated individualisation. References: 1. Armbruster, Adolf Romanitatea românilor. Istoria unei idei, Bucharest, Enciclopedic Publishing House, 1993. 2. Beaujeu-Garnier, Jacqueline – Geographie urbaine, Paris, Armand Colin, 1985. iunie 2005
98 3. Cucu, Vasile S. – România. Geografie umană şi economică, Târgovişte, Transversal Publishing House, 2002. 4. Eade, John - Living the global city, London, New York, Rotledge, 1997. 5. Erdeli, George; Braghină, Cristian – Efectele crizei economice în ţările aflate în tranziţie asupra forţei de muncă. Particularizare pentru România, in Terra, no. 1-4, Bucharest, 1995. 6. Mihăilescu, Vintilă - Geografie urbană în România, Buletinul Societăţii Regale Române de Geografie, Bucharest
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Economic Performance and Labour Productivity in Dutch Regions Jouke van Dijk, University of Groningen, Faculty of Spatial Sciences and Urban and Regional Studies Institute,
[email protected]. Lourens Broersma,University of Groningen, Faculty of Economics and Faculty of Spatial Sciences,
[email protected]. One of the most important policy goals of the Dutch Ministry of Economic Affairs is of increase labour productivity. From international comparative studies it is well known that The Netherlands is a country with one of the highest labour productivity levels in the world. However, compared to other countries the growth in labour productivity has been rather low in recent years. Until now most studies deal with the analysis of labour productivity at the country level and the regional level is largely neglected. Partly this is due to lack of suitable data. The results of an explorative study show that within the Netherlands there are substantial differences in labour productivity between regions. The next step is to explain these differences. In this paper we will relate the regional differences in labour productivity to the regional economic structure, the level of education, labour cost and the presence of agglomeration effects. The paper will be concluded by a discussion of the implications of the empirical results to policy measures at the national and regional level. Keywords: labour productivity, regional labour markets 1.
Introduction
During the 1990s the labour market situation in the Netherlands underwent quite dramatic changes and was dubbed the “Dutch miracle”. Unemployment fell from 8 percent in 1994 to a mere 3 percent in 2001. At the same time employment increased by more than one million jobs between 1994 and 2001. In fact, the growth of employment in the Netherlands was more or less equal to the U.S. and much higher than in the rest of Europe.11 In the
U.S. this strong employment growth was however accompanied by even stronger GDP growth rates, whereas this was hardly the case for The Netherlands. A flexible labour market has enhanced these high employment growth rates in the U.S., whereas in The Netherlands it was mainly attributed to a sustained policy of wage moderation. This led to a fall in labour costs relative to competitive countries. Besides low labour costs a high level of labour productivity is an important factor of competitiveness for countries. One of the major goals of current Dutch economic policy is to increase labour productivity
11
Employment growth in this context measured in persons employed. In The Netherlands a high share of the new entrants on the labour market work part time and, therefore, the growth in em-
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ployment measured in full-time equivalents is substantially lower.
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100 growth. In order to achieve this goal a Dutch Innovation Platform is established, chaired by the Dutch Prime Minister Balkenende, with the aim to reinforce the innovativeness of the Dutch economy. Innovation has a positive effect on productivity growth (Donselaar et al., 2004). Besides this macro policy goal, the most recent memorandum on regional policy “Pieken in de Delta” (EZ, 2004) makes it is clear that enhancing productivity growth is an important goal of regional policy as well. Although in the nineties all Dutch regions had growing employment and falling unemployment there remained substantial regional differences in unemployment (Atzema and Van Dijk, 2005). So, besides for countries, differences in labour productivity may also be an important determinant for the explanation of regional differences in economic performance of regions and, hence, of the competitiveness of regions. However, until now there is hardly information about the spatial variation in labour productivity. In the remaining text we will first give an international perspective of labour productivity by comparing the level and growth of labour productivity in the Netherlands with several other countries both at the country level and at the regional level. In the rest of this paper we will analyze the labour productivity in more detail at the region level. In section 3 we relate regional labour productivity, in terms of GDP per hour, to welfare, in terms of GDP per capita in 2001 for Dutch regions at NUTS-2 levels. In section four, we discuss factors that explain regional differences in labour productivity between 1990-2001 at NUTS3 levels. As a final step we briefly go into Anul VIII, nr. 16
Jurnalul Economic the recent policy measures that aim to stimulate productivity growth. 2. Labour productivity in The Netherlands in an international perspective From international comparative studies it is well known that The Netherlands is a country with one of the highest labour productivity levels in the world (McGuckin and Van Ark, 2004). Figure 1 shows the relation between the level of labour productivity in 1989 and the growth of labour productivity over the period 1989 – 2004 for a broad variety of countries.12 The fat regression line, referring to all countries, shows a negative slope and this indicates that countries with a high productivity level generally show low growth rates. However, for individual countries and groups of countries the picture can be quite different. The Netherlands is located in the lower right hand corner and its position is rather close to other European countries like Switzerland, Spain, Italy and France. In all these countries a high level of labour productivity in 1989 goes together with relatively low growth rates of labour productivity. Another group of European countries consisting of the Nordic countries, the U.K., Ireland and Germany has a slightly lower level of labour productivity, but the growth rate is substantially higher especially for Ireland. The non-European countries Japan, Australia and Canada can also be found in this part of Figure 1. The U.S. is 12
In this case labour productivity is defined as GDP per employed person instead of GDP per hour, because total hours worked are not available for all countries under consideration.
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Jurnalul Economic located more to the right and combines a higher level of labour productivity with a much higher growth rate than the Netherlands. The growth rate in the Netherlands is on a decreasing growth path for a long period of time and during the second half of the nineties it became evident that there was an increase in the productivity gap between Europe and the U.S., as the European productivity growth rate further decelerated, whereas that of the U.S. started to increase. The central and eastern European countries can be found in the left part of the diagram with lower productivity levels, but enormous differences in the growth rate. Romania stands out with a very low level of labour productivity that goes together with also a low growth rate. Bulgaria, Czech, Hungary and Slovenia show in this order both a higher level and growth rate of productivity. Latvia and Lithuania combine relative high productivity levels with lower growth rates, where Estonia and Slovakia have much higher growth rates. Poland stands out with a very high growth rate compared to all other countries, with the exception of Korea. The dotted regression line in Figure 1 with the positive slope clearly indicates that in the central and eastern European countries higher growth rates are associated with higher levels of productivity. This is in marked contrast with the general picture from the regression line for all countries that shows a negative relation between the level of labour productivity and the growth rate. The negative slope becomes even more outspoken when this relation (faint regression line in Figure 1) is estimated for
all countries except the central and eastern European countries. the It seems plausible that at lower levels of productivity there is a positive effect on labour productivity growth, because these countries are catching up to the more productive countries. This effect flattens considerably with higher levels of productivity. As mentioned in the introduction for the Netherlands labour productivity is not only an important issue at the national level, but also at the regional level. However, studies dealing with the analysis of labour productivity at the regional are much scarcer than studies at the country level. Bökermann and Maliranta (2002) performed an analysis for Finland, a country with a strong productivity growth in the second half of the nineties. They found regional differences with the same magnitude as Broersma and Van Dijk (2003) for the Netherlands. When we compare this with the results of a study by Ciccone (2002) in which at the NUTS-2 region of several European countries regional differences in productivity were analyzed (see Table 1) we can conclude that regional disparities in the Netherlands are relatively large. From Table 2 it is clear that the regional differences in The Netherlands remain more or less constant during the last decade. Because of uniform regulations over the country we expect that regional variations in the government sector will be very small. This is confirmed by the higher regional variation reported in the last row of Table 2, where the government related sectors are excluded.
Table 1: Differences in labour productivity between NUTS-2 regions. Country Year Standard deviation regional labour productivity Anul VIII, nr. 16
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France Germany Italy Spain Great Britain Netherlands
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3.6 5.7 3.7 3.2 1.6 5.0
Table 2: Regional variation in labour productivity per province 1990-1995 1996-2000 1990-2000 Standard deviation labour productivity Including non-commercial services 3.3 3.6 3.4 Excluding non-commerical services 4.5 5.0 4.8 Source: Statistics Netherlands, own calculations 3. Regional differences in welfare and the role of labour productivity The most commonly used indicator for labour productivity in the scientific literature is GDP per hour worked. However, it is interesting to compare this indicator with the GDP per employed worker or GDP per capita, because the latter are commonly used to compare regional disparities and serve, for instance, as indicators on which the entitlement for regional policy measures of the European Union is based. The fifth column of Table 3 shows that regional GDP per capita as percentage of the national GDP per capita ranges from 73% in the province of Flevoland to 126% in Utrecht.13 Regional disparities in 13
In some publications the province of Groningen is listed with a very high GDP per capita due to the large amount of natural gas originating from this region. Because natural gas is easy to transport the profits are used nationwide and the benefits for the province of Groningen are rather limited. To avoid this possible statistical bias that also may occur in some other regions in a minor
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GDP per capita can also be due to a low level of labour participation or to a high share of children and retired people in the total population. Therefore, we also calculated the GDP per employed worker taking into account differences in participation and age composition. Column four shows the difference in percent point with GDP for the total population. For the three Northern provinces Groningen, Fryslân and Drenthe about one third to half of the difference in GDP per capita from the national average can be attributed to the relatively low share of active participants on the labour market in the total population and for the island province Zeeland it is even more. Lower participation rates in the age group 15-64 are much more important than differences in the share of children and retired people. The effect of a greying population is most important for the provinces Zeeland and Drenthe with 2.6 and 1.8%-point respectively, but even for these provinces the way the sector mining is excluded from all analysis in this article.
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Jurnalul Economic lower participation rates are much more important. GDP per worker living in a region differs from GDP per hour worked in a region for two reasons: working hours and commuting. The total effect of these two factors is shown in column 3 of Table 3. It is clear that the production of a worker will vary with the number of working hours. Part-time work is very popular in the Netherlands: almost 45% (75% for females and 22% for males) of the labour force works part-time and this is almost three times as much as the EU-average (EU, 2004, p.29, chart 18). Within the Netherlands there are substantial regional differences in part-time work. The most outspoken differences are found for the provinces Groningen and Zuid-Holland. The share of part-time workers is 7%-point higher in Groningen and 6%-point lower in Zuid-Holland than the national average.
Relative high shares of part-time workers are furthermore found in the provinces Fryslân, Drenthe and Zeeland, who have relatively low GDP’s per capita. Another disturbance is caused by the fact that people who live in a region can be productive in another region. Because GDP is measured at the work location and the size of the population and the labour force at the place of residence this may cause a bias because there is substantial cross border commuting between provinces. The effect of commuting takes by far the largest part of the 27.3%-point calculated for the province of Flevoland, located on reclaimed land from the IJsselmeer, a lake that used to be part of the former Zuiderzee. The high number of commuters from Flevoland to the provinces Noord-Holland and Utrecht accounts for a large part the opposite effect of commuting in these provinces.
Table 3: Regional differences in GDP and disposable income in 2001 (Netherlands = 100; mining excluded) GDP per hour Effect of parGDP Effect of partworked time work and ticipation and per (labour commuting age composition capita productivity) % of % of Nedprovince %-point %-point Nedererland land Groningen 101.6 -6.3 -5.4 89.9 Frieslân 92.3 -10.2 -4.6 77.5 Drenthe 87.9 -9.2 -4.8 73.9 Overijssel 89.1 -2.1 -2.5 84.5 Flevoland 98.9 -27.3 1.2 72.7 Gelderland 93.2 -6.4 -1.0 85.9 Utrecht 105.7 12.1 8.2 126.0 Noord102.4 9.2 5.1 116.7 Anul VIII, nr. 16
Disposable income per capita % of Nederland 90.9 90.0 93.6 91.8 91.8 97.3 107.3 102.7
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101.9
2.5
-0.7
103.7
107.3
101.6
-8.3
-9.3
84.0
96.4
95.3
1.2
1.9
98.3
99.1
94.6
-5.5
-2.8
86.2
97.3
Starting with the GDP per capita in column 5 of Table 3 we are now able to compare this with GDP per worked hour (column 2) taking into account differences in active labour market participation, working hours and commuting. GDP per capita is not a proper measure for labour productivity in terms of competitiveness of workers’ performance for which GDP per hour worked is more suited. When we compare those measures in column 2 and column 5 we may conclude that regional disparities are now much smaller and range from 87.9% to 105.7%. However, with the exception of the new province of Flevoland and Zeeland, the rank order of the provinces is more or less the same implying that on average the regions with a high level of GDP per capita also show a high level of GDP per hour worked. This ranking of provinces in terms of economic performance corresponds also quite close to the ranking we get when we use the disposable income per capita as indicator of welfare. The regional variation in disposable income is of the same magnitude as GDP per hour worked. This is remarkable because GDP per hour worked can be seen as a measure of regional productive performance at the workplace, whereas disposable income per capita is measured at the place of residence and includes the redistribute effect of taxes, subsidies and social security. The most notable exception Anul VIII, nr. 16
is the province of Groningen, which is in terms of GDP per hour worked above the national average but ranks in terms of disposable income together with Fryslân at the lowest level. Table 3 shows that this is caused by relatively low participation rates in combination with a relatively low number of working hours. These low participation rates are due to the high number of young persons in university and higher vocational education and the high number of non-participating females over 40 years of age. The low number of working hours, resulting in a high share of part time workers, is partly caused by the high share of government services, like education and health care, where part time work is very common. Lower participation and less working hours are most likely also due to a lower demand for labour due to the remote location of Groningen. In addition, social security benefits, pensions and so on are incorporated in the disposable income, but not in regional GDP. These secondary income components mitigate regional differences in GDP per capita even further. From column 2 in Table 3 we may conclude that the regional disparities in GDP per hour worked are smaller than in GDP per capita. However, we may also conclude that the regional differences in labour productivity are substantial in 2001. GDP per hour worked in the centrally located province of Utrecht is 1.2 times iunie 2005
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Jurnalul Economic higher that in the province of Drenthe in the northern part of the country. At the NUTS-3 level of 40 COROP-regions the difference between the highest and the lowest level is 1.5 and thus substantially larger. Therefore, in the next section we will analyse the regional differences in labour productivity during the last decade in more detail at the spatial level of the 40 COROP-regions (NUTS3). 4. Regional differences in labour productivity Figure 2 shows the regional variation in the level of labour productivity in 2001 for COROP-regions in The Netherlands (see Appendix A for the demarcation of the COROP-regions).14 GDP per labour year ranges from € 51,000 in ZuidoostDrenthe to € 78,000 in ZeeuwschVlaanderen, whereas the average for the Netherlands is € 64,000. Two types of regions show the highest level of productiv14
For the analysis by COROP-regions we use GDP per labour year as indicator for labour productivity. This is because employment in terms of number of hours worked is unavailable by region before 1995. Instead we use the labour volume as measure of employment, expressed as the number of labour years. This means that (part time) jobs are converted to their full time equivalent, i.e. two part time jobs of 20 hours a week each equal one full time job of 40 hours a week. GDP per labour year is very close to GDP per hour, but may slightly differ because the definition of full time is not exactly the same for each sector due to differences in collective agreements (CAO’s) with regard to the length of the standard working week, days-off etc. Because the sectoral distribution differs by region, labour productivity in terms of output per hour worked may slightly differ from output per labour year divided by the average annual full time working hours.
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ity. The area consisting of Amsterdam, Gooi- en Vechtstreek and Utrecht is highly specialised in financial and business services, especially in ICT and creative industries. The other regions with high productivity levels are found in both the central part of the country around Rotterdam and IJmond and in the peripheral areas of Zeeuws-Vlaanderen and Delfzijl. These regions have in common that capitalintensive industries in basic metal and chemistry are very important. The regions with low levels of productivity are located in the periphery, especially in the east along the German border. Figure 3 shows the average annual real growth rate of labour productivity over the period 1991-2001.15 In all regions real labour productivity growth is positive, ranging from 0.2 per year in Alkmaar e.o. to 1.7 % per year in Delft en Westland. The average annual growth is 1.1%. Of the regions with the highest level of productivity in Figure 1 only Delfzijl is also in the highest growth category in Figure 3. In general the regions with growth rates above the national average are also the regions with a level of productivity above the national average. However, the relation is not very strong as becomes clear from the rather low value of 0.26 for the correlation 15
We measure the growth of labour productivity in real terms because the growth in nominal terms includes changes in prices in GDP and this gives biased information about the performance of labour as production factor. In the period 19912001 prices in services increased substantially where the price levels in the industrial sector remained more or less constant. When we should have used the nominal figures instead of the real figures the increase in labour productivity in regions with a high share of services should have been overestimated.
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106 coefficient between level and growth. The regions with a strong service sector and located in the middle of the country on the border or just outside the Randstad show the fastest growth in labour productivity. In the regions in the Randstad and the province of Brabant the main cause of this growth is an increase in GDP. In the regions with high productivity growth in Gelderland and Overijssel and in the traditional trouble spots of Oost-Groningen and Zuid-Limburg lagging productivity growth is mainly a consequence of the slow growth of employment. Instead of an increase in economic activity, the high labour productivity growth for these regions may indicate the removal of slack capacity. This implies that regional disparities in productivity levels increase slightly over time. Especially the peripheral regions with low levels of productivity are lagging behind more and more. The case of Delfzijl clearly shows that regions with a high level of productivity and a high growth rate are not always very prosperous regions: during the whole period 1991-2001 the peripheral region of Delfzijl shows the highest unemployment rate of all Dutch regions. 5. The explanation of regional differences in labour productivity As a next step we will shed some light on the explanation of the observed regional differences in labour productivity. As will be clear from the description of Figure 2 and 3 the sector structure plays a role. Regions with an overrepresentation of capital-intensive industries or specialized services do better in terms of productivity. There is also an obvious relation beAnul VIII, nr. 16
Jurnalul Economic tween the level of education and labour productivity reflected in the variation in wages by educational level. From the viewpoint of competitiveness of a region a lower level of payment can compensate a lower level of labour productivity, because a low level of productivity, combined with a low wage, might lead to the same unit labour cost that a high level of productivity combined with a high wage would yield. Therefore, Figure 4 and 5 provide maps with the share of higher educated in the labour force and the cost of labour per labour year.16 Finally, the map in Figure 6 reflects the density of the number of jobs per square kilometre, which can be seen as an indicator for the presence of agglomeration effects. All maps in Figures 4-6 are based on average values for the period 1991-2001. In the discussion about the regional differences shown on the maps the sectoral composition in a region is several times mentioned as a possible explanatory factor. From recent studies by Broersma and Van Dijk (2003) and Broersma and Oosterhaven (2004) who analyse Dutch data for 1990-2000, it becomes clear that regional deviations from the national sectoral composition account for about 25% of the regional variation in the levels of productivity. From a shift-share-analysis based on 20 sectors (mining is excluded) it becomes clear that the high productivity level in the area Amsterdam, Gooi- en Vechtstreek, Utrecht and ‘s-Gravenhage (The Hague) is partly caused by an overrepresentation of service sectors with high levels of productivity. The regions with 16
Like the labour input in our productivity measure, this implies that all jobs are converted to full time equivalent jobs.
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Jurnalul Economic high productivity levels due to the presence of capital-intensive industries in IJmond and Rijnmond and the peripheral areas Delfzijl and Zeeuws-Vlaanderen also show positive effects of the sectoral composition. The negative sectoral component for most of the peripheral regions with low productivity levels indicates that low productivity sectors are over-represented. Figure 4 shows the regional variation in the average share of higher educated (academics and higher vocational graduates) over the period 1990-2001. The share ranges from 36% in Amsterdam to 12% in Oost-Groningen, where the share of higher educated in the national labour force is 25%. The regions with a high share of higher educated outside the Randstad are mainly the regions where institutes for higher education are located. When this map is compared with Figure 1 it is clear that regions with low productivity levels (often located in the periphery) usually have a lower than average share of higher educated in the labour force and vice versa. This positive relation is confirmed with the value of 0.42 for the correlation coefficient. As is clear from a comparison of Figure 4 with Figure 2 there is no clear relation between the shares of higher educated and the growth rate of labour productivity and this is confirmed by the correlation of 0.03 between these two variables. From the map in Figure 5 reflecting the regional differences in labour costs, measured in thousand € per labour year, and a correlation coefficient of 0.69 with regional difference in labour productivity, it is clear that lower levels of productivity are partly compensated by lower average wages. The highest labour costs are found Anul VIII, nr. 16
in Amsterdam (€ 33,400 per labour year) and the lowest in Zuid-Limburg (€ 28,500 per labour year), whereas the national average equals € 30,200. The correlation coefficient of 0.56 suggests that a lower average wage in a region is related to the lower share of higher educated in that region. Most probably this effect is even stronger because wage cost is in this comparison measured at the work location and education at the place of residence and thus a bias may occur due to commuting effects. The positive relation between wage costs and the level of productivity indicates that low productivity does not necessarily lead to higher unit labour costs and thus might not have a negative effect on the regions competitiveness. In line with the result for education, comparison of Figure 5 with Figure 2 does not indicate that there is a relation between wage cost level and the growth rate of labour productivity and this is confirmed by the correlation of -0.03 between these two variables. Instead we expect wage growth to correlate with productivity growth, but regional wage growth rates are largely similar due to the fact that in The Netherlands collective wage bargaining results on wage growth rates apply to all regions. Therefore differences in regional labour productivity growth and regional wage growth are not related. In Figure 6 the job density per square kilometre is shown. Job density can be seen as indicator for the presence of agglomeration and cluster effects that may have a positive influence on labour productivity (Ciccone, 2002). By far the highest spatial concentration of jobs is found in the government centre s’Gravenhage (The Hague), with 1483 jobs per km2, where in Oost-Groningen and Zuidwest-Friesland iunie 2005
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there are only 52 jobs per km2. The areas with a high concentration of jobs are all located in the Randstad and correspond largely to high productivity areas. In the peripheral regions job density is substantially lower than the national average of 186 per km2. The positive relation between job density and the level of productivity is also confirmed by the value of the correlation coefficient of 0.70. Job density is also positively correlated with the share of higher educated in Figure 4 (r=0.70) and labour cost in Figure 5 (r=0.56). When Figure 6 is compared with the growth of productivity in Figure 3 the similarities are less clear and the correlation coefficient is even negative (r=-0.13). It seems likely that the growth of productivity is hampered when the spatial concentration of jobs is extremely high and causes congestion, as is the case in the Randstad-area. Regression results obtained by Broersma and Oosterhaven (2004) confirm this hypothesis. They find that higher spatial concentrations of jobs are significantly positive related to the level of productivity, but are significantly negative related to productivity growth. 6. Conclusions implications
and
policy
Even though the level of labour productivity in The Netherlands is very high compared to most other countries, the rate of growth of Dutch labour productivity has decreased compared to its competitors in Europe (EU-15) and to the U.S.17 This causes the competitive advan17
See Groningen Growth and Development Centre, Total Economy Data Base, at www.ggdc.net.
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tage of The Netherlands on other countries to erode. When labour productivity remains at this declining growth path additional labour input will yield increasingly smaller additional output. However, a further increase in labour supply, especially for women and elderly, is precisely what the Dutch government is aiming at by means of tax policy, increasing the statutory working week and with revisions of the social security and disability arrangements. This call for additional labour supply does not stop the downward trend in productivity growth. It is therefore necessary that productivity growth is stimulated in another way to make this additional labour also more productive labour. An important policy handle in this respect is stimulation of innovative behaviour of both companies and government. We focus here on regional issues that may help to enhance productivity growth, since productivity growth is not only the goal of macroeconomic policy in The Netherlands, but also of regional policy (see EZ, 2004). At the NUTS-2 level of twelve provinces, regional differences in economic performance measured in GDP per capita are substantial in the Netherlands. GDP per capita in the richest province of Utrecht is 1.7 times higher than in the ‘poorest’ province of Flevoland. We have shown that a substantial part of this inequality can be attributed to regional differences in participation rates, commuting and working hours. When we control for these variables we end up with GDP per hour as an appropriate measure of labour productivity. Labour productivity in Utrecht and Drenthe are still the most extreme cases, but the difference goes down iunie 2005
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Jurnalul Economic from 1.7 to 1.2. At the NUTS-3 level of 40 COROP-regions the regional differences are substantially larger with a factor of 1.5. The highest level of productivity is found in the Randstad regions that are highly specialised in financial and business services and in a few regions with capitalintensive industries in basic metal and chemical industries. The regions with low levels of productivity are located in the periphery, especially in the east along the German border. Traditionally the main aim of Dutch regional policy was to reduce regional disparities by stimulating the economy in peripheral regions. Over time this goal of equity between regions has more and more been substituted by the goal of enhancing national efficiency. In the most recent regional policy plans of the Dutch government the focus is on regions with a national interest and the main aim is to remove barriers in those regions that hamper productivity growth. Because of the national interest of these regions this helps to stimulate national productivity growth. The government suggests that these regions are basically the Randstad and the southeastern parts of The Netherlands and not the peripheral regions that were subject to regional policy for decades. The main reason for focusing on the core regions is the assumption that they have agglomeration advantages due economies of scale, spillovers and vicinity to other economic activities. Allocating regional policy measures to these regions is supposed to give the highest return on investment and to lead to an extra boost of productivity growth. A crucial question in this debate is the relation between agglomeration effects and productivity. There is indeed a positive Anul VIII, nr. 16
relation between job density, as approximation of agglomeration effects, and the level of labour productivity. However, we found a negative relation between job density and the growth of labour productivity. This suggests that investing in already highly dense regions will lead to more congestion and less space, which in the end leads to even a further slowing down of productivity growth. Instead investing in less dense regions (the light areas in Figure 6) seems to be a much more promising route to get the productivity growth rate back on track. These results severely doubt the assumption of the government that the allocation of the major part of the budget for regional policy to the congested regions in the Randstad and southeast Netherlands will lead to higher returns for the Netherlands as a whole than investing in the more peripheral regions in the northern and eastern part of the Netherlands. Besides higher returns at the national level, investments in peripheral regions may also help to reduce regional disparities in welfare, although this is no longer an official goal of regional policy for the present government. Regions with high levels of labour productivity can be characterised by a high share of higher educated in the labour force and a high concentration of jobs. From the positive correlation between labour productivity and labour cost we can conclude that the advantage of higher productivity is partly offset by higher cost. This implies that in terms of competitiveness the regional differences are substantially smaller than the figures about labour productivity suggest. It is clear, however, that regions with lower levels of labour productivity also show lower levels of iunie 2005
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GDP per capita and this often also goes together with lower participation rates and a higher share of part time workers in these regions. Labour productivity and participation rates are both positively correlated with education. In accordance with the work of Barro (1991) this may suggest that a policy aiming to increase the level of education in a region should be advocated. The latter is only a good recipe if the higher educated can indeed find employment within the region. Otherwise the only effect will be an increase in out-migration of higher educated, because recent empirical evidence suggests that causality may run mainly from employment growth to education and not vice-versa (see Bils and Klenow, 2000 and Van Dijk and Bosch, 2003). In this case a policy aiming to diminish the share of workers with the lowest level of education via formal education or via on-the-job-training might be more successful to reduce regional differences in welfare than a policy focusing on the increase of the share of highly educated, who might leave the region after finishing the education. Instead of a policy focusing on education, a policy aiming to create new jobs for both low and high skilled might be a better alternative to solve the problem. References: Atzema, Oedzge A.L.C., and Jouke van Dijk (2005). 'The Persistence of Regional Unemployment Disparities in the Netherlands'. Chapter 9 in Daniel Felsenstein and Boris A. Portnov (Eds.) Regional Disparities in Small Countries. Heidelberg: Springer, p.147-167. Barro, Robert J. (1991). Economic growth in a cross-country section of counAnul VIII, nr. 16
tries. Quarterly Journal of Economics 106 (2), pp.407-43. Bils, M. and P.J. Klenow (2000). Does schooling cause growth? American Economic Review 90, nr. 5, p.1160-1183. Bökermann, P. and M. Maliranta (2002), “The Micro Level Sources of Regional Productivity Growth in Finland”, Discussion Paper No. 186, Labour Institute for Economic Research, Helsinki. Broersma, L. and J. van Dijk (2003), Arbeidsproductiviteit in Fryslân. Groningen: University of Groningen, URSI-rapport 305 (in Dutch). Broersma, L. and J. Oosterhaven (2004), Regionale arbeidsproductiviteit: niveau, groei en verklaring. Groningen: University of Groningen,. Eindrapport aan het Ministerie van Economische Zaken (in Dutch). Ciccone, A. (2002), “Agglomeration Effects in Europe”, European Economic Review, 46, 213-227. Donselaar, P., H. Erken en L. Klomp (2004), “R&D and Innovation: Drivers of Productivity Growth”, in: G. Gelauff, L. Klomp, S. Raes and T. Roelandt (eds), Fostering Productivity: Patterns, Determinants and Policy Implications, 75-91. EZ (2004), Pieken in de Delta. Den Haag: Ministry of Economic Affairs (in Dutch). EU (2004), Employment in Europe 2004. Luxembourg: European Commission. Klomp, Luuk, and Theo Roelandt (2004), Innovation performance and innovation policy: the case of the Netherlands. De Economist, 152 (3), p.365-374. McGuckin, R.H. & B. van Ark (2004), “Performance 2002: Productivity, iunie 2005
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Jurnalul Economic Employment and Income in the World’s Economies”, The Conference Board, Report R-1328-03-RR, New York. Van Dijk, Jouke, and Sebastiaan Bosch (2003). 'Firm related training in a
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tight regional labour market'. Chapter 5 in Eike Schamp and Vivian Lo (eds.) Knowledge, Learning and Regional Development. Münster/Hamburg/London: Lit Verlag, p.83-105.
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Figure 1: The relation between the level of labour productivity in 1989 and the growth of labour productivity over the period 1989 – 2004. (source: Groningen Growth and Development Centre, Total Economy Data Base (at www.ggdc.net))
Average annual percentage growth rate of labour productivity 1989-2004
4.5 Kor
Pol
4.0 3.5
Ire
y = -0.06x + 3.90 R² = 0.26
3.0
Sla Tur
y = 0.04x + 1.30 R² = 0.08
Sle Est
2.5
y = -0.03x + 2.74 R2 = 0.11
2.0
Nor Fin
Ger
Cze
1.5
Bul
Aus
Gre
USA
Den UK
Por
Lat
1.0
Sw e
Hun
Jap
Bel Aut
Can
Ice
Fra
NZe
Rom
Lux
Ita Spa
0.5
Nld
Lit Sw i
0.0 0
10
20
30
40
50
60
Labour productivity (1000 US $ per employed person) in 1989
Western countries: normal font acronym; Central and Eastern European countries: acronym in italics; Fat trend line: all countries; Faint trend line: Western economies; Dotted trend line: Central and Eastern European economies;
Figure 2: Level of labour productivity as value added (in 1000 €) per labour year worked in 2001.
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Figure 5: Average total labour cost (in € 1000) per labour year, 1990-2001.
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Jurnalul Economic Appendix A. Regional demarcation of the COROP-regions
Nr. Corop Nr. Corop Nr. Corop 1 Oost-Groningen 11 Zuidwest-Overijssel 21 Agglomeratie Haarlem 22 Zaanstreek 2 Delfzijl en omgeving 12 Twente 3 Overig Groningen 13 Veluwe 23 Groot-Amsterdam 4 Noord-Friesland 14 Achterhoek 24 Het Gooi en Vechtstreek 5 Zuidwest-Friesland 15 Arnhem/Nijmegen 25 Agglomeratie Leiden en Bollenstreek 6 Zuidoost-Friesland 16 Zuidwest-Gelderland 26 Agglomeratie 's-Gravenhage 7 Noord-Drenthe 17 Utrecht 27 Delft en Westland 8 Zuidoost-Drenthe 18 Kop van Noord-Holland 28 Oost-Zuid-Holland 9 Zuidwest-Drenthe 19 Alkmaar en omgeving 29 Groot-Rijnmond 10 Noord-Overijssel 20 IJmond 30 Zuidoost-Zuid-Holland
Anul VIII, nr. 16
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Disfunctions in the large urban habitat Berceni – Bucharest Assist. Prof. Alexandru Gavriş, PhD candidate Academy of Economic Studies, Faculty of International Business and Economics - Bucharest The changes in the political regime and those conected with the mentality of Bucharest population have found the large urban habitats without any real support in the internal structuring and functionality. All the components of these urban structures were planned accordingly with the comunist ideeas of development: large assembly composed by block of flats, large industrial plants near the rezidential areas or even inside them, overly controll in the population dynamics. In this situation, internal structure of habitats was unequipped from the new transformation point of view to come. So, I tried to look over some dysfuncyions of large urban estate, emphasized only the most problematic characteristics (those with the greatest potential of disrupting the fragile coeherence of rezidential units from Bucharest). My paper is divided in three parts: the first, in which is depicted the history and evolution of large urban estate from Berceni area; the second focused on the main structural perspectives of this urban tissue. I sintetized some matters on the future of these urban tumours in the last part, but only on brief Key words: large urban habitat, Berceni, dysfunctions, urban renewal 1. Introduction
I
The ensemble of blocks of flats of Berceni, better known as the Berceni neighbourhood, situated in the south-east part of the Capital, is one of the largest Anul VIII, nr. 16
human concentrations of the city (over 150 000 inhabitants). Concerning its situation, from the point of view of the functional areas of urban interest, the district of Berceni has a peripheral position, its initial purpose having been to supply human force for the industrial platforms. The modification in the governing system has left such great habitats to wither, as for fifteen years the urban renovation has been inexistent. However, its advantage is represented by its localisation in the length of the southern axis of city penetration, even though it is a bit out of centre towards the connection axis with Giurgiu, but open to communication with Oltenita and to the possibility to advantageously import agricultural resources from around the urban space, but the lack of preoccupation for a Iunie 2005
120 proper integration according to the systematic-human principles has left the great habitats in general and the area of Berceni in particular in a little favourable position in the urban ensemble. The history of the neighbourhood of blocks of flats of Berceni starts five decades ago, through the decision of the communist society to turn to the construction of pluri-family houses, most of them of medium height, following patterns imported from France and the Soviet Union (initially considered a success, but a great failure presently). The place in which it was built used to belong to the suburban communes Serban Voda, Aparatorii Patriei, Barzesti and also, included a big part of the vacant lands in the fourth district of the Capital. The process began in the period after 1920, when the demobilised from the First World War are being appropriated, or a series of lands are being bought by people with modest incomes. The old houses built up to 1950 are being replaced until 1960 with block of flats, especially towards the circulation arteries, the inside of the new “walls” guarding the same rural character; it determines isolation in the tissue, both functionally as aesthetically speaking. As a reaction to the demands of labour force from the industrial platforms nearby, the phenomenon of population originating from other regions of the country “implantation” occurs, or the peasants from the neighbourhood are being drawn up (especially the ones with low economic situations), as the difference between the workers’ salaries and the ones of the peasants were decisive for the urban migration. Indirectly, through collectivisation, an available surplus of labour force necessary for achieving the industrial objectives. A new neighbourAnul VIII, nr. 16
Jurnalul Economic hood resulted, whose specificity is given by its functionality – district of blocks of flats, by its constructions’ (frontal) architecture and by the predilection of the work place. But if, from a functional point of view, we may still speak of the Berceni neighbourhood, through the appeal to the principles of spatial organisation, we will introduce in the analysis of the Romanian cities another category: the great urban habitat, which reflects all of the analysis aspects at an intra-urban level. The great habitat of the Berceni area, along with other 19 such urban structures (I. Ianos 2001), contains a sum of specificities, out of which the following detach: urban tissue with over 2500 houses, the compactly built surface, state built and rented houses, houses with many levels. The origin of the great habitats resides, therefore, in the industrialisation policy of the communist system – “moment of stagnation in the natural evolution of the city, but also, involution, and regress” (C. Iavoroschi 1999) – which necessitated nits with a large number of employees. These industrial locations, with a high concentration of industrial machines in a certain space have favoured the setting up of the industrial platforms – primarily IMGB, for the present case, and the platforms from the Rahova-Progresului (Vulcan) area, respectively Jilava, secondarily. This is where the idea of developing a residential area in the close proximity emerged, in order to enhance the accessibility of the labour force towards the industrialised platforms, doubled, however, by the desire of city expansion, to occupy an important position in the European top, according to communist criteria (industry, numerous population, and blocks). The Iunie 2005
Jurnalul Economic order in the urban hierarchy was wanted to be a quantitative one, and secondarily a qualitative one, in Bucharest, 63.7% of the population presently living in large human habitats (I. Ianos 2001). According to the nature of the built space (I. Ianos 2001), the great habitats respect the following typology: large habitats built in the urban spaces through demolition; large habitats built on free lands and identified with the city, large habitats built at the periphery of the built urban space, the great habitat of Berceni belonging to the last two genetic types. Presently, after approximately 50 years from its setting up, the analysed structure has yet to find a defining structure, the obvious eclecticism being the effect of the interventions in the communist period. As a matter of fact, the impact of the economic restructuring and the degradation of the social situation caused by the income shrinking – is generally remarked in the accentuated degree of depreciation of the present urban image over posed to the one of the past (I. Ianos 2001). 2. The dysfunctions in the urban system ensemble of Berceni - Bucharest The generation of the elements with perturbation character in the great urban habitats represent the consequence of two types of approach of the intervention policy: the over solicitation and the passivity correspondent to the two regimes – the communist one, and the one based on capitalist relations one, respectively. Each of these have their own characteristics that allow the shaping of the elements favouring the development of the urban space, but also, the ones that have had and have an inhibitive poAnul VIII, nr. 16
121 tential on the dynamic of the Bucharest city. In the ensemble of the great urban habitats in Bucharest two variants of the dysfunctions that have been determined by those interventions may be identified: a). visible / active dysfunctions b). latent / hidden dysfunctions 2.1. Visible dysfunctions 2.1.1. Structural and functional dysfunctions 2.1.1.1. The dysfunctions in the residential areas. Bucharest has not suffered from fundamental changes of its urban structure until the beginning of the ‘50s, its expansion coming as a result of more ore less big projects. Among these, we may include the succeeding dividing into parcels, meant to either grow the city beyond its limits, or to grow the density and fill in the holes inside it – generated by small county operations or by urban reasons of modernisation. (C. Iavoroschi 1999). In order to occupy the inhabiting fond, people without adequate education from the diverse corners of the country and from the villages in the proximity of Bucharest were drawn to fill in the urban void. Afterwards, the flux towards the city is blocked through radical measures, destined to keep the balance, but the city had already been occupied with a population unfit to the urban conditions and requirements. This is why it is presently so difficult to change the mentality of many of the inhabitants of the Capital towards a more active participation to the administration of the locative spaces. Between the lacks of power of a certain generation, the lack of interest or conscience of another, the urban image is lacking the attention of its inhabitants. Iunie 2005
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1 Complex struc tural units: 1,2,..6
Bloc ks
Among the urban living structures, the diverse component microstructures are too little socially, economically an culturally integrated, the synergy emerging from their individuality favouring the accentuation of the elements with inhibitive potential at an urban development level. What may be remarked for these urban tissues are mostly, the aspects tied to the appearance period, and the type of houses rather than the functional and inter-human relations. Defining for the functional composition of these great urban ensembles is the classification into complex structural units (sectors – neighbourhoods – microdistricts [complex urban units – proximity units]), which has imposed the allocation of the social-cultural endowments primarily taking into account geographical criteria, or even their integration without targeting the development potential of the habitats, minimising the ratio of the social aspects. The structural solution is characterised through the dense construction in the territory and through the lack of differences of the Anul VIII, nr. 16
Jurnalul Economic spaces from the usage point of view (public/ domestic). This lead to: difficulties in stating the obligations of housing the residential unit (of the tenants, or of the local administration) some side effects on the people’s psychology. Therefore, there was an attempt to isolate the residences from the major circulation arteries in order to transform the territory into a great park, in which they could find their dwellings (Matei Adriana 1979). However, the building sites created for the new ensembles have lead to the appearance of many uncared for places or the degradation of the green spaces due to lack of interest, creating the so-called “grey spaces”, which, through the minimisation of their initial functions, have deprived the tenants of the possibility to initiate social contacts. And the result of the communist attempts has resulted in the front of multiple level blocks, created especially along the circulation arteries. Their dominant position, beside the fact that it isolates, to a great extent, the inside of that urban complex unit, creates the impression of big urban trucks, divided into fragments by side streets. The inside of the urban complex units is scattered with less then five floor blocks, enclosed by the great living factories. It is the case of many areas stud also, with the old remains of the suburban communes. These characteristics dominate the urban image, especially in the south and eastern parts of the Capital, which have been integrated into the urban ensemble from the posture of suburban communes, and the interest for the speeding up of the urban remodelling process has not been a keen one, as the Iunie 2005
Jurnalul Economic major interest was focused towards the central area. The evolution of the great habitats has been somewhat stopped, once with the replacement of the communist regime, the following period being characterised by the lack of interest - especially in the first years - for the new approaches to integrate into the urban scenery these multileveled residence complexes, but also, by the neglect of the rural looking communities present, mostly into the tissues. Aside that these divide into fragments the territory in a chaotic manner and reduce the space availability, they produce visible ruptures, fact which increases the segregation from the analysed space. A separation is created, but at the same time, a deficient crossing between the urban and the rural, present, mostly in the mentality of the people and which impedes the habitats’ restructuring. Of course that under these circumstances (the rural aspect, minorities, streets “abandoned” by the municipal administration, the lack of the tenants’ association, the interest only for the own residence, may it be in a block, or a house), the proper endowments have had very much to suffer, as their inexistence or their advanced degree of degradation was manifesting itself on the fond of the population’s income reduction, as well as of the growth of the maintenance expenditures. Through the dictatorial urbanisation policy, in the totalitarian period “moment of stagnation in the natural evolution of the city, but also involution and regress” - a form of property, a sense of belonging to the city and a way of life very hard created have collapsed. Through the diminution of the individual value inside the lock forest, the man has been overwhelmed with the egalitarian Anul VIII, nr. 16
123 uniformity coming out of the buildings’ aspect. (C. Iavoroschi 1999). Right after 1990, the reduced cost of the flats and the lack of a proper legislation have allowed the reinstating of the proprietary statute, but in a new form. However, to this much differing from the initial one form, the modification of the mentality and the accentuation of the individualism through the import of the “Occidental crisis” is associated with new orientation fields towards an urban existence marked by the degradation of the buildings and of the surrounding spaces. The stock of residences is another vital problem of the population living in the large habitats of Bucharest. The proportion of the rooms in the flats is a bit smaller than the number of the people living in them, as a consequence of the initial destination towards the young labour force, therefore young families formed of a majority of workers - easily influenced by the pro-natal policy in the setting up period. This is why, presently, the apartments are insufficient for family inhabiting, as the large number of members create a supplementary discomfort to the general stress the block inhabitants are subjected to. The residences from these types of neighbourhoods are small, endowed with a minimum of comfort, inblock living being associated by the most people, with an ordeal, few people considering that they have a satisfying situation. The fact of the matter is that the block is a convenient alternative because, in the opinion if most of its inhabitants, it offers a lack of responsibility and reduced expenditures, but compensated by the lack of intimacy, a higher nervous consumption, a degradation of the housing sense, the problem of car parking, the lack of adequate agreement spaces and a minimum degree of safety. All these offer Iunie 2005
124 the sensation of “macabre” collectivism (as a respondent stated it - questionnaire in the Berceni area, 2001). Another problem is given by the quality of the buildings in its ensemble. The necessity of building more and more blocks determined the using of cheap materials, whose usage and quality is reflected in the aspect and structure of the residence ensembles. Therefore, the massive introduction of the great construction panels from the late ’60s and their usage throughout the entire communist period, presently determines a diminution of the general quality of the residence stock. According to the classification of the type of material used for the outside walls, Bucharest has known an intense usage of bricks and concrete, but the data reflects only a general level, and therefore, I was not able to realise a differentiation on the types of usage. After 1995, the forming of the new classes of opportunists and the lack of interest manifested by the mayors concerning urban integration of the different location areas has allowed the appearance of the villas, one of the floors in the “urban tree”. These have been and still are built not following an urban plan, but according to the financial potential and relations of the owner. The villas have started to be inserted shyly, at first, in the places of the old houses remained from the times when they were integrated to the suburban communes, but then, more and more, trough the occupation of the green spaces which were, as they were, insufficient, or through the obtaining of approvals for the building among green spaces. However, at the level of the great habitats, they are not that numerous, the main obstacle being the limited stock of space. They create, however, a contrasting image to the massive and Anul VIII, nr. 16
Jurnalul Economic compact blocks, offering the grounds for the diversity of the constructions’ scenery, but also, the roots of a segregate mentality, developed by the inhabitants of the blocks, due to the obvious contrast. The amalgam present in the great urban habitats, instead of promoting a positive competition which could diminish some of the initial effects, determines inside each tissue (individual or collective) ruptures and dichotomies on all levels from the districts. The observation scale, like visualising a fractal may be enhanced, but the problems appeared are the same, the variations being due to the specific nuances and relations. The spatial insularity of the residences - no matter the floor we stand on - is occupied, therefore, by tall blocks and much too crowded for the actual usage boulevards and roads. The rigidity of the limits represented by the circulation arteries favour the isolation, and finally, the separation of a tissue from another, meaning the involution of the system towards death (seen as a negative phenomenon). Therefore the infiltrations in the depth of the residential organism are weak and visually or functionally unsustained by positive elements (Annemarie Constantinescu-Strihan 1999), the degree of entropy diminishing, as stated above. 2.1.1.2. Dysfunctions among the industrial areas 2.2 The industrial areas The policy of growth of the number of people in the cities, implicitly, the endowment of a privileged position to the Capital has been realised due to the centralised plan of forced reduction of the ratio of inhabitants from the rural area, disregarding the future conseIunie 2005
Jurnalul Economic quences. To this, we may add the belief that industry is the promoting factor of urban development, and especially, of the communist society. The case of the urban habitat of Berceni represents one of the multiple interventions of the sort when for the functioning of the industrial areas created at the periphery of the city, multilevel residence ensembles have been built. And for the coverage of the residence fund, people without adequate education were drawn from all over the country, as well as from the neighbouring villages, only to fill the urban void. Normally, the inadequacy to the new life medium is felt presently, and for at least one generation more. Next to the centralised decision, one of the most important factors that have determined the existence of the great habitat of Berceni is the I.M.G.B. industrial platform, placed at the limit of the district. Its construction began three years prior to the one of the residence blocks, in 1962, the influx of financial capital and human energy increasing in the following years. It effected the systematisation of Bucharest through the setting up of the great residence area in the Berceni area, doubled by the extension of the subway region, including the afferent stations and the creation of new transport lines both intra-urban and around the city, as well as through the building of the I.M.G.B. house of culture. Inside the great habitat of Berceni, two industrial unites are the ones that nuance the urban space and may produce perturbations of the subsystem: AMIRO S.A - medical equipment and Berceni S.A. - pastry products. These, however, are part of the light industry and sustain, through their products, the population of the area and of the medical centres in the Anul VIII, nr. 16
125 proximity; their degree of integration into the municipal administration ensemble of the area being, in a great part, the one that creates problems. There may also be mentioned the small industrial units of the private managers in the Resita and Sura Mare areas (specialised in meat products). There is also the factory from Oltenitei, at the south-eastern edge of the habitat, Romprim S.A. - Diesel engines. Per ensemble, under the circumstances of economic poorness of the current life (2001), many of the great industrial spaces of the area have lost part of their commercial power, this reality reverberating towards all other levels of urban life (A. Strihan 1999). Through this, the auxiliary functionality of the habitat of labour force support for the industrial platforms has diversified, the connection with the genetic factor being no longer, an essential one, and conferring a relative independence to its inhabitants. The current interventions in those areas need to solve the old problems. The rigidity of the residence neighbourhoods being causing a lot of discomfort to their inhabitants and an internal macrostructure marked by major industrial locations determine a difficult future development through planning of the cities. The perspective of the integration of the industrial structures into the urban context accentuated by the functional and physiognomic ruptures through the creation of microstructures with specific functions and the finding of architectonic solutions is a major imperative of the future urban restructuring. 2.1.1.3. Dysfunctions at the tertiary areas’ level The function of the great habitats as residence space for the inhabitants of the Bucharest city has been the only one Iunie 2005
126 whose implementation was fully realised, however, disregarding the fact that its presence is conditioned by other secondary supporting functions. Next to the residential function, the industrial one nearly covered the entire spectre of urban inhabitancy. Therefore, the two functions were seen as the main pillars of urban development in Bucharest, as the endowments for free time spending, as well as the ones for social-cultural activities were neglected - elements with destabilising potential, in the view of the former leading structures. The sudden changes at the level of the great urban habitats of the Capital force the internal system to remediate the functional ruptures of the previous period. Shyly at first, but more impetuously afterwards, the economic activities are the ones that intervene among the functional niches in order to cover the existent deficit. Initially, their presence was a chaotic one, manifested, also, as a dysfunction due to the improvised character and not oriented toward the target; afterwards, once with the structuring of the political and economic relations, the activities among the great habitats have started a sedimentation process in accordance to the their coverage power. If initially, the disorganised and negatively impacting activities of the small managers were the most numerous ones, presently, the supermarket or even hypermarket chains set their mark on the economic function from the habitats. The presence of the tertiary activities in the urban living complexes support the relatively normal functioning of the great habitat through the larger offer of jobs, the stimulation of the local economy, and the localisation of the services according to the demand and of the offer (to the extent to which this is possible). Anul VIII, nr. 16
Jurnalul Economic The first steps were timidly realised right after 1990, and when it was possible, the commerce has degenerated between 1994 and 1998 in the multitude of lodges and booths, badly maintained shops and the providing of weekly qualitative products to most institutions, state owned. Normally, the lack of concurrence in various areas, the monopole of the state in the most important services and their corroboration with old mentalities have made possible a sum of negative events, whose settlement met many difficulties (“the lodge owners’ protest”). Step by step, both the basic services, as well as the special ones have gained power on the fond of concurrence accentuation, but the morass of the political and social ambiguities has lead to an unhealthy development, the main beneficiaries - the inhabitants - being to this day treated without respect. a. Basic Services Attention must be drawn towards some elements - the appearance, along the pavements and in the main intersections of a diversity of booths and lodges improvised in order to pursuit commercial activities has been realised in the fond of the lack of certified endowments and of the necessary field reserves (Constantin Enache 1998), to which the mentality change, from excess of planning in the previous period, as opposed to the liberty understood as anarchy, has added. The presence, or almost five years of the second-hand stores, and of the pawn-shops express the lack of an adequate functioning of the shops in the great urban habitats, on the fond of economic poorness of the inhabitants, aiming, especially the middle-inferior population segment. The appearance of large private shops has responded to the street Iunie 2005
Jurnalul Economic retail commerce, but the small prices the small shops, the mix lodges offer, allow them still to survive even if the products are not qualitative. The dividing into fragments of the small shops situated along the circulation arteries, at the higher than five levels blocks’ ground floor seems to be e viable solution for the time being, the accessibility and the price being settled in a balanced ratio, as a consequence of the localisation in apartments or of the reduced price of the former state owned shops. Without a territorial continuity, but with a localisation given by the possibilities and less by the attractive form, these shops belonging to the small managers are sensible to the economic oscillations, their existence period being relatively small. Other available services among the private chain are the health ones: chemist’s shops, small private clinics, and dental clinics. They are not always at the normal standards, but their appearance is the result of even worse problems in the state sector they try to compensate. The growth in the number of vehicles has reverberated immediately in the multitude of gas stations and vulcanisation units that stud nearly all important arteries, modifying the pedestrian flux and the aesthetical aspect of the street. b. Special Services A big problem of the great urban habitats has appeared due to the lack of an efficient space organisation, the living ensembles representing only residential spaces, without a proper support at the level of the services. Their image is that of urban factories, who lack the possibility to beneficiate of all adequate finishing Anul VIII, nr. 16
127 operations for their products. Therefore, through the absence of the special services, the inhabitants had and still have in some areas, to walk for considerable lengths in order to cover their requirements. The bizarre situations the inhabitants found themselves in order to appeal to the medical or educative services with a higher degree of complexity are still present. High schools, hospitals, administrative units and other such services providing institutions have been concentrated only in some areas, mostly central ones, without requiring those locations. As such, it has arrived to that situation in which in the great habitats the presence of services represents a rare fact, and the distribution of the urban transportation network complicates even more the unwinding, under acceptable terms of the inhabiting process. On the fond of the changes in the economic needs, after 1990 the special services have started to appear among the habitats, but at a punctual level, and only there where the attraction power of a habitat allowed it. This is why the most dynamic, under this aspect, were the banking services that have been inserted in the land areas. They have been especially distributed along the major circulation arteries that allow the strong directing of the financial capital force and the concentration of adjacent services. The banks are especially concentrated there where the process of unwinding of the financial actives is at the maximum: markets, chains of shops, and crossroads with important commercial objectives. These three locations are present, no matter the habitat, the bank power alone representing an element of differentiation from this point of view. The other special services more important for the existence of the great Iunie 2005
128 habitats, respectively the educative and health ones have known other characteristics. They have appeared point-like, with private capital contribution, according to which they have gained their bigger or smaller importance at the level of the habitat, but also of the neighbouring ones. We may therefore, mention the Informatics School among the Dristor habitat or the private universities of Spiru Haret and Dimitrie Cantemir, or the medical and legal centres located according to the space and cost availability. Their distribution is determined by costs, not by attractiveness or interest potential as in the case of the banks. However, these services also, have begun to gain force, as the initial small and later on greater competition have made possible the development of quality services which are now directly competing with the state ones. Generally, in order to revitalise these areas a new direction that must be followed is the one of relocating the services and promoting the centres with reviving and redirection of the urban course power. 2.1.1.4. Dysfunctions among the special areas One of the severe problems of the Romanian cities after 1990 is undoubtedly, the degradation and the diminishing of the existing green spaces. The superficiality with which the cities’ administrators, as well as the inhabitants approach this problem is to the least, worrying. At a central level, there where settlements and laws are being conceived and, theoretically, their appliance is ensured and supervised, one may say that the problem is to the least, ignored. This statement could be contradicted by the existence of legislation acts issued in this period. Anul VIII, nr. 16
Jurnalul Economic However their effect is practically null.(Gabi Pascariu 2000) Why do these happen? Because a space occupied only by trees looks unprofitable in the eyes of the people that see income sources everywhere. There should be, if not a New York hotel sized bank, then at least a gas station, a fastfood or a small bar - at the best- because, in the end, we are managers. Anything, as long as it produces money and we imitate the American style. But the fact is that here, things don’t go like over there. Here, things go worse than in the country side, with all our efforts to get gold out of the poor parks which only did their duty to produce a little oxygen. (Manuela Babescu). The lack of uniformity in the distribution of the green spaces among Bucharest has lead to the situation in which certain areas have close values to the imposed standards, but are conditioned by the presence of large green spaces at the edge of the habitats and not by the existence among diverse recreation areas. The reality offers another image. Excluding the great parks and referring to the real habitats, we conclude that the presence of the oxygenised surfaces is almost a null one. This does not mean that the green spaces do not exist, but that the creation of special surfaces to ensure the specific functions is not adequate. The necessity of solving the problem of the green spaces is felt by the population, requiring a faster implementation of this sort of category. The problem of the green spaces results from the thickly built urban surface, the squares, or the insufficient small green spaces in front of the residences. As a fact of the matter, the lack in continuity of the green spaces is obvious, the exceptions from the few Iunie 2005
Jurnalul Economic more favoured Racovita areas confirming the rule. In accordance to the recent studies concerning the social and mental aspects of urban life, the placement of the green spaces takes into consideration the walking period towards and from the green spaces. And among the great urban habitats, the value of 15 minutes as an environment quality indicator is not uniform, the concluding heterogeneity manifesting itself on all levels. As a matter of fact, the accessibility and quality of the available green spaces is much more important than their size, a totally opposed aspect at the Capital’s level. The lack of specific recreation areas is not compensated by the presence of recreational parks, because the served area is very wide, covering in some cases, the surface of two districts (the Tineretului Park, the Carol Park). If until now, we have referred to the recreational function of the green spaces in the habitats, the function of protection curtain that they should have is practically inexistent. The presence of big polluters in the area, even at the edge of the habitats, and sometimes inside them, which do not have the realised impact studies, constitutes an important stress factor and a perturbation element of the quality of the urban life. Under the circumstances in which the green spaces must diminish the pollution values, their projection is not efficient, and their realisation is absolutely lacking. The international norms are flagrantly disrespected and these have quite severe repercussions on people’s health. The pollution along the canyonstreets takes place primarily – excepting the traffic part of the street – in the area of the sidewalk and of the residential spaces situated in the close proximity of Anul VIII, nr. 16
129 the circulation artery. All big circulation arteries, with an intense traffic should dispose of green spaces settlements along them (street alignments, gardens and squares), in order to face the traffic conditions. But the utopia we desire is becomes bigger, as the pedestrian traffic (unprotected by the green spaces) is allocated to the great extent according to the road one; we may observe the lack of organisation degree in the urban planning. The organisation of the oxygenised surfaces in a society with high values shows the degree of civilisation, but the urban ideal with many inhabitants, factories and industries, of the communist society had other plans. The deficit of green spaces, characteristic not only to the great habitats, but also in general, to the Capital (some small exceptions) has been “built” through the destination change of some existent spaces and their allocation for the construction of buildings (p+5), as well as through the progressive diminish over the past few years, of the green spaces, due to lack of maintenance or illegal constructions. The declared green space fond is much diminished, both by surface as from a biological point of view, a new category appearing in the spotlights – the grey spaces. All of these profoundly affect both the aesthetic aspect of the great habitats but especially the lack of the green spaces considerably diminishes the health genesis of its people, an element whose importance is too little taken into consideration by the responsible factors. 2.1.1.5. Dysfunctions regarding the circulation areas For a quite long time, the function of the great urban habitats has been that to accommodate the labour force – this is Iunie 2005
130 where the “multi-family residence neighbourhood” comes from -, the people’s fluxes between them and the industrial/commercial areas being supported by the deficient transportation system both, locally and regionally. The setting up of the “living factories”, along the great arteries is highlighted also by the transportation network which follows, to a great extent, the collector arteries. The majority of the streets appear as impenetrable axes limited by closed barriers of multi levelled blocks (p+5) (Annemarie Strihan 1999). The peripheral and longitudinal position in the habitat of the collector roads is not completed, as it normally should among a network (if we were to follow the correct sense – etymology of the word) of penetrations into the urban tissue and nearly not at all by transversal ties. Everything has a peripheral importance (district at the edge of the city) materialised, therefore, also by the transportation system, the distance between relatively close locations being a detouring one; the continuity is interrupted by obstacle small roads and the lack of the transportation means. In a centralised system it is only normal for economies to prime before quality in order to fulfil the working plans, and the population must get by under the circumstances of the insufficiency of transportation means and being late on the job. The replacement of the old system has not modified to a great extent the look of the transportation network, but from the point of view of the appearance of second hand carriages from the trams and of the buses of the same sort “imported” from Germany or France. The secondary character that it plays in the urban system is reflected also by the local covering old buses and trolleys, the modAnul VIII, nr. 16
Jurnalul Economic ern auto park belonging to the connection lines with the centre. The keeping of the initial features of the network, the growth in the population number, the freedom of choosing the workplace, the growth in the number of vehicles and the agglomeration of certain special services, may it be in the area (the hospitals), either their translation to the centre, determines in the hours of great traffic, true “mobile packages” on the roads and in the transportation means. The concentration of the transportation lines along the great circulation arteries generates a maximum amount of stress when, in the most cases, the phonic and air pollution, the traffic and the lack of space combine. The quality of urban life in such situation is severely affected, the respondents wanting, in their vast majority, a change and due to the transportation (although they do not explicitly express it). The obvious chaos cannot be solved that easily because it would mean the penetration of the block wall, and other solutions based on the existent roads – much too small – impose the circulation only of the means of common transport. And other consequences, in appearance, latent ones, may emerge with unpredictable consequences, augmenting the degree of dysfunction. The enhanced importance the inner streets have is not fully profited from, as the lack of objectives (destroyed) and of the services reflecting itself in the unknowing of the urban interior and spatial isolation. Socially, the street is a communitarian space, the fond for any urban scenery, which would mean that the residences should be reoriented towards a common driveway, doubled by specific objectives, and not towards the great polIunie 2005
Jurnalul Economic luting arteries (Kevin Lynch, 1962). As a matter of fact, the parallelism between the pedestrian space and the street leads to a maximum pollution, as the passers by must wait for the transportation means in tram rests inhaling a maximum pollution level in the early hours of the day when the concentration of the harmful agents is at a maximum and the traffic is overcrowded. The population flux and its concentration towards the major intersections is inefficiently valued, as the interest pole these represent have yet to draw the attention of the potential investors (only carburant companies). Even if the complexes destined to be the centre of vitality of these areas are inhabited, to a great extent by the inhabitants of those particular habitats, their association to the notion of centraliser does not hold water. The satisfying of basic functions and the placement in the most important intersection is too little exploited from, the offered potential by the street structure being here, as in many other cases, improperly used. Our opinion expressed the idea that the week valorisation was due to the deficient urban projects, presently, the improvement of the public transportation towards the centre of the city being an imperative. 2.2. Latent dysfunctions 2.2.1. The segregation and the social issues The double conditioning of the intra-urban space (exogenous: by the competition dynamics and new processes and strategies of firms’ relocation and from the inside, through the specific dynamics and conditions) generates an essential problem: is it more important to study the social disparities among the intraAnul VIII, nr. 16
131 urban space, or should we just ignore them under the pretences that the limits of this space are not rigorous enough because they are arbitrarily traced and not on the basis of scientific criteria or the problem is hard to quantify due to the lack of statistics. Anyone knows the limits of the administrative delimitation of the space and the associated information, but despite these limits, the information may reveal important aspects of the social disparities. The urban spaces suffer from the most intense transformation processes in a very short time. The mutations resulted in the periods in which they can barely find their coherence, after they have made a new passing, favour the appearance of social ruptures and tensions. In the attempt to adapt the internal parameters to the macro-structural requirements of the urban space, the neighbourhoods, and in general, the living spaces have the tendency to shut their limits, to isolate themselves from the rest of the community. The phenomenon is acute there where the human origins and characteristics of those habitats’ inhabitants are similar. From another point of view, the growth in the mobility has allowed the superior classes to search for new options, to avoid the social problems through the choice of the preferred community and implicitly, of the residence space, and therefore create clubs and exclusivist territories (A. LoukaitouSideris, T. Banerjee, 1996). The rejection of the others appears as inherent, under the circumstances in which the desire of new, of retransformation of the old structures is viewed as a danger. Therefore, the inhabitants from these closed (not totally, because that would be a theoretical model) spaces will Iunie 2005
132 seek to make their own internal organisation and will impose a new power pole. The power pole of the unstructured space will directly compete with the superior power, and, as any newcomer, will seek to impose itself as soon as possible. This is why the closed, unstructured spaces are looked upon as a tumour of the urban space because they tend to divide the order, the expansion, and the urban spaces have the tendency to positively evolve and not regress towards the rural media. However, not only the isolation from the others through the rejection of the innovations leads to social and spatial ruptures, but also the lack of a power pole – landmark at the scale of a community or society – which allows not a closing, but on the contrary, an unlimited opening. Some places seem shut, but, in fact, they lack the centres and limits the centres could have determined. The decomposed, disaggregated place has the same inertia as the place firmly shut between barriers (Annemarie Strihan 1999). Therefore, the limit, in the urban context is not only a helping element for tracing some borders, with or without a purpose, but also serves to the establishment of a social solidarity and conflict feeling. Its complete desegregation leads to the loss of the security sensation and f the feeling of belonging to a community and to a place. The total opaqueness of the limit determines the lack of communication discomfort, of the lack of an understanding regarding living together between the two parts of the limit. The cause of the first type of segregation is the absence of landmarks, which would induce movement, translation-communication tendencies; the cause of the second type is the impossibility of communicating with the exterior, Anul VIII, nr. 16
Jurnalul Economic the inexistence of the necessary exchanges in order to establish a balance state with the environment. The both situations have the same extreme finality; the inertia and disappearance of the place as a form, in the urban context. The social problems bear many faces, but mainly, can be reduced to the same factor, and that is the economic level. The lower it is the more reduced the possibilities to integrate the new changes. People have limited communication opportunities with the other inhabitants from the neighbouring habitats, and therefore, create their own interest centres, as a response to the immediate un-intervention of the coordinating power. 3. Urban restructuring Instead of being viewed as a process, the problem, the current city is disputed as a thing, as a reproducible object. It is n longer integrated into the dynamic cycle it is part of, and becomes utopia, a fantasy whose image excludes people and takes into consideration only the structural elements of the urban medium. This is why the role of the city planners is a delicate one, at the time in which the interventions on the habitats take place, primarily having to take into consideration the quality of the inhabitancy and the insurance of the long-term development of the settlement. The most difficult problem the urban planning specialists from Romania are confronting is represented by the way to integrate large habitats into the urban space. The present tendencies seem to programme the finality of this action into a far away future, the consequence of the multiple problems to which the urban management is confronted (table no.1). Iunie 2005
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133 difficulties and the low income of the residing population of the great habitats deter the remodelling task
Table no.1. Problems of the urban management Errors of projection, construction, structure, the type of the used materials Physical The usage of the utility infrastructure The lack of the social contact chambers The lack of equipment and neglect of the spaces from the proximity of the buildings The very big density of the buildings The State is no longer involved in insuring the quality of the resiPolitical dences The systematic breaking of the internal rules The lack of the comSocial munitarian spirit Criminality The growth of the social disparities and the spatial segregation Recession Low incomes High inflation/ reduced economies The Economic high rate of unemployment The lack of interest from the proper organs The lack of communiInstitutional cation of the necessities Control intersection The lack of models and concepts for restructuring The approach Organisational (urof the small steps Contradictions between the urban planning obban planning) jectives and the political ones The difficulty of urban restructuring the intervention among the great habitats implies resides mainly in the lack of funds to sustain the potential projects; however these do not exist, or are low shaped. Even more, the general interest for these urban aggregates is no longer as high as in the post revolutionary years, in which the rapid privatisation of the apartments in the great habitats has generated important funds, whose utilisation has been wrongly applied. As a matter of fact, the interest for the large habitats is reflected very well in the selling price of the apartments (diminished with approximately 30% as opposed to 1992), the high costs of maintenance of the residences determining the population to find new residencies, either cheaper in the rural medium, either to build immobile units in the areas around the cities. Anul VIII, nr. 16
The decentralisation of the services concentrated in the central part of the city and the development of the intraurban poles imply a new approach of urban restructuring and a new attempt to remodel the spaces occupied by the large habitats. The restructuring of the industrial properties neighbouring the great habitats, as well as the stock of available space it offers may be used as niches to create new urban elements in order to attenuate the physiognomic disruptions of the urban scenery. Even though it has been tried to uniform the urban tissues in the peripheral areas, the necessary costs and the movements the spaces had to suffer could not allow the realisation of the initial purpose. In these habitats it has been reached to a separation pushed to the extremes between inhabiting, work and recIunie 2005
134 reation, ideas which are presently long gone on the urban horizon. We must think that any futuristic innovation of the present may be unconsidered by the society of the future – at its time, as any other attempt, apparently inopportune today, to become a success in time. This is what happened to the great urban habitats whose idea in the ‘60s seemed to remediate the encountered dysfunctions (space, numerous people, and costs). We may observe a multitude of urban aspects in these tissues represented, therefore, by the human, architectural and functional diversity. What is important, however – the inhabitants of this area must deal entirely with the faults of the former regime, but also of the newer ones. And the strong points of the former regime strongly reverberate, as the people seem to see a fundamental idea very little: they are especially the ones that must involve themselves in the habitat’s restructuring. The large are the blocks of flats cover, the numerous people of the residential districts and the limited financial means of the community make it extremely difficult to integrate such structures into the modern urban ensemble, capable to offer an improved comfort and an attractive urban image (I. Ianos 2001). The impact of the economic restructuring and the degradation of the social situation of the population - caused by their diminished incomes – are remarked in the degree of urban image depreciation, in general (I. Ianos, 2001). The restructuring of the great habitats must start from the idea of urban reintegration into the geographical space. The creation of the optimum ties between areas and the extension of the cities along the main access ways towards Anul VIII, nr. 16
Jurnalul Economic the peri-urban space may diminish the negative effects caused by the accentuated degradation of life and of the physical medium from the great urban habitats (I. Ianos 2000). 3.1. The revivalism of the great habitats – desire or failure? The disaggregating of the hierarchical and relation structures based on a partially controlled by the decision centre normal evolution has materialised through the imposing of a new development road and the decision to confer a new image to the urban space of Bucharest. The image built according to the industrial organisation model in which the role of the secondary sector is the dominant one and pushes forward the ulterior development of the city, was in the case of Bucharest, as in the case of any other similar centres, a total failure. Living inside not esthetical blocks, comfort-less and sometimes with important problems regarding the necessary endowments, the high density of the buildings generated by the necessity of replacing the old suburban components integrated now to the city and the planning of the relations according only to the industrial spaces, and later one, to the civics’ centre, all these have shaped into an image profoundly repulsive and the alienation of the inhabitants of those structures. Seen as a way out of the crisis period that followed the Second World War, the migration towards the great city has attracted a poorly prepared population as to the requirements of the urban life and much too less prepared for the new industrial projects that were about to be implemented. The mentality of the newcomers in the urban medium and the ideological propaganda promoted in the Iunie 2005
Jurnalul Economic first years of “socialist reconstruction” have functioned without too many troubles; the state offered jobs with a salary level much higher than the one in the urban space to which we may add the offer of residences, while drawn the population was less than content with the new conditions. In time, however, the ruralsuburban behaviour has suffered very few modifications, so that some blocks from the great habitats could be compared with vertically disposed villages. The breaking of the barriers and the loose legislation that followed in the ‘90s has shaped a declining city, without personality and having a lot of problems, one more severe than the other. And maybe the most important problem that arose on the fond of the new freedoms the population was apprehending is the crisis of the residences, under its three forms: a). the insufficient number of free apartments as opposed to the existent demand; b). the quality of the residences; c). the growth of the maintenance costs. The possibility to buy the residence in the first years was considered a very profitable favour, but, after a while, at more then 10 years from the change in the property form (state - private), we may remark the gravity of this situation, in ensemble. Once passed into the private owned form, the apartments among the great residence ensembles have been used as goods of which the proprietary fully disposed, and absolutely no interest was paid to anything outside the own surrounding space. Isolated at the level of the apartments, their inhabitants have showed too little interest for the general quality of the entire ensemble they live in. If in the previous period, the lack of inAnul VIII, nr. 16
135 terest was due to the lack of belonging, now, the phenomenon is generated by a too big individuality. The interruption of the continuity for the administration and improvement of the great living structures has much diminished the effective life of these ensembles, the results being blocks with more and more problems in the aesthetics and structure. The problem of the residences has been more accentuated by the withdrawal of the support the state had offered as well as by the exaggerated individualism in managing them, and even more by the growth of the maintenance costs and the diminishing of the living standard of the population. The current conditions outline a city in which life among the great habitats becomes more and more difficult, and the alienation of the people becomes higher and higher; the few options headed towards the improvement of living and the revival of the ensembles are stopped by the same sickening mentality that limits the action freedom. Marked by the inefficient duality of intervention (the local authority is too less involved, and the inhabitants are too preoccupied with solving their own surviving needs), the great urban habitats of Bucharest constitute themselves as declining structures on the road of urban evolution. In the context of the successive crisis through which the great urban habitats have gone (the uniformity of the social life, the deterioration of the economic climate), the causes determining the current situation are based on three directions: a) the inefficient placement of the physical and human resources through the lack of some and the massive concentration of others; Iunie 2005
136 b) the need of freedom, restrained both by the social regime as well as the living inside a block , but currently transformed in individualism and lack of care; c) the excessive importance given to the secondary sector of the economy and the depending relation between it and the vitality of the habitats. The few progresses made through the appearance of new services and the reorientation of the economies at a small scale towards the demand are isolated and do not have the power to pull out of the crisis these structures of the urban space. And maybe the crisis could be controlled if it were accepted at an administrative level. Although it is obvious, the lack of the intervention programmes and the absence of some strategies meant to direct the habitats towards an efficient self-organisation are the main causes of the decline. But the crisis is seen by the central and local structures only in critical cases for their own existence that is among the electoral periods. In these cases, a multitude of plans appear, whose principles are, mostly, utopian, taking into account only the political side and the winning of electoral capital as it has happened the moment the exchange of property was liberalised. And, therefore, the inhabitant of the great habitats dreams more and more to a return towards the rural-like life, in which one could dispose of an individual residence integrated to the urban medium, with the possibility to breed animals and to take care of a small garden. These fantasies determined by the rural mentality, unchanged by the time passing, or by the affinity for individuality are not just simple ideas of the need for modernisation according to the models of the developed countries, but rather a special Anul VIII, nr. 16
Jurnalul Economic form resulted from the post-socialist cultural hybridisation. (Manicke-Gyöngyösi 1995, apud H. J. Bürkner) References ALEXE, CRISTINA – (1995), Particularitati ale spatiului public in Bucureşti, I.A.I.M., Bucureşti BERRY, B.J.L. – (1970), Geographic perspectives on urban systems, Prentice-Hall, New Jersey BICIUSCA, FLORIN – (1999), Elemente de antropologie a locuirii, I.A.I.M., Bucureşti ENACHE CONSTANTIN – (1998), Utilizarea teritoriului urban si reglementarea in urbanism, I.A.I.M., Bucureşti GOODALL, BRIAN – (1987), The facts on file dictionary of human geography, New York, New York IAVORSCHI, CECILIA – (1999), Locuire urbană, I.A.I.M., Bucureşti IANOS, IOAN, ed. – (2000), Integrated urban systems and sustainability of urban life, Editura Tehnica, Bucureşti IANOS, IOAN – (2001), Large urban habitats in Romania, manuscris, Bucureşti LYNCH, KEVIN – (1960), Good city form, The M.I.T. Press, Massachusetts LYNCH, KEVIN – (1984), The image of the city, The M.I.T. Press, Massachusetts LOUKAITOU-SIDERIS, ANASTASIA; BANERJEE, TRIDIB – (1998), Urban design downtown – poetics and politics of form, The University of California Press, Berkeley MACHEDON, FLORIN – (1998), Metode de analiză a evolutiei ţesuturilor si organismelor rurale si urbane, I.A.I.M., Bucureşti Iunie 2005
Jurnalul Economic MERLIN, PIERRE – (1991), L’Urbanisme, Presses universitaires de France, Saint-Denis MERLIN, PIERRE ed. – (1988), Morphologie urbain et parcelaire, Presses universitaires de France, Saint-Denis ROBSON, BRIAN T. – (1975), Urban social area, Oxford university press, Oxford
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137 STRIHANCONSTANTINESCU, ANNEMARIE – (1999), Determinari spaţiale şi sociale ale limitei în ţesutul urban, I.A.I.M., Bucureşti TUDORA, IOANA – (1998), O reţea verde pentru Bucureşti, I.A.I.M., Bucureşti
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Border and Labour Market Martin van der Velde & Egbert Wever Radboud University Nijmegen
1.
Introduction
Uneven regional economic development is a well-known research topic in economic geography. Much attention is paid to (a) the explanation of differences in economic performance between regions and to (b) policies that could eliminate at least a part of the arrears of the economically weak regions. Many economically backward regions are peripheral regions as well. On the basis of the principle of cumulative causation Myrdal used the notion ‘core-periphery’ to illustrate the interrelatedness between rich (the core) and poor regions (the periphery) already in 1957. Many poor peripheral regions are located along a national border. These regions are handicapped in their development since national borders are supposed to act as a barrier for economic interaction. In geography handbooks we read that interaction between potential economic partners that are separated by a border is less intensive than between partners that are not separated by a border. Shops get no or less clients from the other side of the border. A port, Hamburg during the period of the Cold War being an example, can be cut off of its ‘natural’ hinterland. Of course, the intensity of cross-border interaction depends on many other factors too: the degree of openness of the border, the degree of cultural, ethnic and linAnul VIII, nr. 16
guistic differences on both sides of the border, and differences in prosperity. Reasoning from a neo-classical point of view economic integration would especially be beneficial for border regions. The lifting of tariff and nontariff barriers eases cross-border interaction, and might reduce transaction costs. Integration changes the peripheral location of many of the border regions too. Within the European Union many border regions nowadays even claim that their location within the EU has become quite central. However, against this background we must admit that in reality the economic situation of many of these ‘old’ peripheral regions within the EU did not change so much. Many are still relatively poor, asking still for additional support from their national governments as well as from ‘Brussels’. In this paper we deal with crossborder interaction, including the lack of such interaction, focussing on crossborder labour mobility. Stimulating mobility, for labour, capital and goods, has been one of the driving forces behind the European integration process from the beginning. Our starting point is that cross-border labour mobility depends on the character of the border involved. Referring to Oscar Martinez’ attempt to categorise borderlands (1994) we distinguish four categories. The ‘alienated border’, that is a border that does not allow any crossIunie 2005
140 border interaction. This situation exists when neighbouring countries have serious conflicts, the border between North and South Korea being an example. The ‘coexistent border’, that is a border where in a certain sense that are conflicts or different interests too, but they are less problematic, they are manageable. Such borders allow controlled cross-border interaction. An example is the border between Romania and Ukraine. The ‘interdependent border’, that is a border between neighbouring states that have stable relations. This border allows for a significant amount of exchange, although there is not yet a situation of free flow of goods and persons. The US-Mexican border and the outer border of the EU being examples. The ‘integrated border’, that border has in fact been eliminated, implying the free flow of goods and labour. The Dutch-German border is an example. Figure 1 gives the outline of the paper, in which we mainly focus on ‘in-
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Jurnalul Economic terdependent’ and ‘integrated borders’. Although we deal with cross-border labour interaction, our contribution is placed in the general EU framework of social cohesion. That framework implies battling (regional-)economic disparities by encouraging economic development in backward (border) countries or regions. Especially for economically backward border-regions the elimination of inner EU borders is considered to open new perspectives for cross-border interaction of all kinds (labour migration and commuting, trade, tourism, investments etc.), especially in those situations in which cross-border differences in production costs exists, or in the availability of specific products. When discussing this aspect of ‘openness’ we adopt two perspectives. The first is an ‘institutional’ one, stressing the formal, juridical functioning of national borders. The second one is a ‘psychological/ mental’ perspective, which aims more specifically at the perception of the border by individuals.
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Figure 1: Cohesion through interaction The paper is structured as follows. The first part discusses the issue of ‘institutional’ openness of the border for cross-border labour markets, that is to say the efforts that are put into (a) the ‘eradication’ of the inner EU-borders for the free flow of people (and of goods and money), as well as (b) establishing, what is called sometimes, the ‘Fortress Europe’, by reinforcing the outer EUborders. The focus of this first part will be mainly a national (macro) one. After a short intermezzo, in which we change focus from the national to a regional (meso) level (i.e. the cross-border region), the second part deals with the issue of ‘personal or individual’ mobility or interaction. In this part the psychological or mental aspects and impacts of (national) borders are discussed.
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2 Cross-border labour mobility and institutional openness of a border The ‘interdependent border’ In this contribution we will deal with two ‘independent borders: the USMexico, and the outer EU border. Both can be linked to a process of territorial integration: NAFTA and EU. The US and Mexico belong, together with Canada, to the North America Free Trade Agreement (NAFTA). Compared to the EU, NAFTA has a very modest aim: free trade between the member states and a minimum of super-national structure. Free trade is stimulated by lifting export tariffs for many goods coming from member countries. However, there is no common outer tariff, like in the EU. Each country has the possibility to impose its own tariffs for non-member Iunie 2005
142 states. Moreover, unlike the situation in the EU, there is only a more or less free flow of goods, but absolutely not a free flow of labour. In fact, labour mobility is restricted severely, especially between the US and Mexico. In order to protect the interests of the well-paid American workers only a restricted number of Mexican workers is officially allowed to enter the US. To keep all other Mexican
Jurnalul Economic workers away, programs like ‘Gatekeeper’ (1994), ‘Hold the Line’ (1994) and ‘Safeguard’ (1999) have been put into operation. They changed the border in a highly militarized zone, with high steel walls and high-technology detection equipment that is much grimmer than its popular name ‘Tortilla Curtain’ suggests (figure 2).
Figure 2: The US-Mexico border in the San Diego-Tijuana area This curtain, that became even grimmer after 9/11, separates regions that differ quite substantially in economic welfare. In July 2002 the average manufacturing wage on the Mexican side of the border was $2.40 per hour, on the US side $15.20. These low wages make the nearby Mexican border region an attractive low cost area for American firms. Especially after the signing of the NAFTA agreement many US firms decided to produce or outsource activities in the so-called maquiladores. In 1993, just before the signing, 1,475 maquiladores existed in the Mexican border regions with nearly 500.000 workers. In Anul VIII, nr. 16
2000 there were 2,759 maquiladores with almost one million workers. However, the rapid growth of the number of jobs in the maquiladores could not prevent that thousands of Mexican workers are still looking eagerly to the other side of the border, where wages are much higher than in Mexico. Many of them try to reach the US illegally, taking sometimes extremely high risks18. 18
The situation is different along the USCanadian border. Because of the (a) much smaller differentials on both sides of that border (b) the relatively smaller number of workers living there and (c) the emotional nearness between Canadians and Americans that border is
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Figure 3: The Spanish-Moroccan border at Ceuta Within Europe we can distinguish four types of ‘interdependent borders’. Nearly a copy of the US-Mexican border is the Spanish-Moroccan border near the Spanish enclave Ceuta (figure 3). The much more friendly and easier to cross for Canadian workers. But even here, the situation changed after 9/11. In January 2007 for instance Canadians require again a passport to enter the US.
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second type we find in the Mediterranean, where the authorities in countries like Spain, Italy and Greece desperately try to prevent illegal immigration from especially North Africa. The third type is the new EU outer-border, where massive investments are implemented to help the new member states in reinforcing ‘Fortress Europe’. A forth type that at least looks less grimmy and is supposed to be temporary, is the new inner-border, that came into existence with the entrance of the ten new member states May 2004. Along all four types of ‘interdependent borders’ we see that just as in the US, the EU-member states fear that a big influx of workers will disturb their ‘home’ labour market, resulting in unemployment of their ‘own’ workers. Discussions around the recent EU expansion illustrate these fears19. Although the EU stands for free movement of goods, capital and labour the old EU members (EU15) decided that individual countries could establish a transitional period of several years (Germany and Austria seven years) in which they could restrict the inflow of workers from new member states like Poland, Hungary and the Czech Republic. Such fears are even bigger for the inflow of African workers. But like the Mexicans many of these African workers as well risk their life by crossing the Mediterranean in small unsafe boats to reach the ‘right side’ of the border. For them too, the big difference in wages is the main motive to take this dangerous 19
At the end of the 90s 14,840 Dutch and 12,000 Austrian workers had a job in Germany. At that time Germany was more or less closed for Polish and Czech workers. Only 1,500 Polish and 6,000 Czech workers had a job in Germany. The fear was that many Polish workers would cross the border when Poland would join the EU (Janssen 2000).
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144 and unsure step. And here too the EU countries regularly legalize African workers at least when they have found a job. Recently no less than 700.000 illegal migrants were legalised in Spain. One could question if these fears are legitimate. This holds especially for Eastern European workers, for which life has clearly more perspective than for Mexican and African workers. Previous EU enlargements, especially the one of 1986, when Spain and Portugal entered, did not show such an influx of workers. Neither did the workers in former EastGermany migrate en masse to the richer parts of Germany when the Berlin Wall disappeared. Of course, one could argue that the situation with Spain and Portugal was less problematic, since the welfare and wages in these two countries were much higher than in the new member states in 2004. For example, GDP per capita in Spain and Portugal was already more than 60% of that of the old members. For Poland this is less than 50% (Molle 2005). So for Eastern European workers it was relatively more attractive to migrate to the EU. But we should realize that not only wages in the new member states are low, the same holds for living costs and that might restrict the incentives for Eastern European workers to leave their country. Moreover, the economies of most of the ‘new’ member states are performing relatively well and we know that faith in a prosperous future is a good argument to stay. The outcomes of an opinion poll among inhabitants of the new member states point in that direction too. In 1991 Eastern Europeans were not interested at all in migrating to an EU country: only 5% of all interviewed Polish, in Hungary and the Czech Republic even less. More people were interested to work temporarily Anul VIII, nr. 16
Jurnalul Economic in a EU country, but even there it concerns no more than 13% of the Poles, 7% of the Hungarians and 4% of the Czechs (Bruinsma & Hakfoort 2005). In a recent report in a Dutch newspaper (NRC-Handelsblad 4 May 2005) it was even said that compared to the situation just before Poland entered the EU less Polish workers would be interested in leaving Poland. According to Papapanagos & Vickerman (2000) that is the normal situation for work migration in Europe. Prognosis raise doubts about popular fears too. For Germany and Austria, the countries that will attract most Eastern European workers, this influx is not more than 1.7 and 3.1 percent of the total working population in these countries (Bruinsma & Hakfoort 2005) in the coming years. For Germany that is more or less the same as the influx of ethnic German workers after 1990, and these workers did not create any problem. The same situation exists in the Netherlands. In a recent report (Arbeidsmarktanalyse of the Council of Work and Income – CWI, 2005) it was said that 34.000 53.000 Polish are working in the Netherlands. But in the past already thousands of Poles were working, partly illegal, in agriculture (horticulture), the meat industry and the building sector, without creating any problem. In fact, many Dutch enterprises contracted Polish workers, not because they were cheap, but because of a lack of Dutch workers. The ‘integrated border’ The old inner EU borders, like the one between Germany and the Netherlands, are examples of ‘integrated borders’. Along these borders labour mobility is not restricted at all. On the contrary, mobility of workers or students is stimuIunie 2005
Jurnalul Economic lated. But, unlike the situation along the US-Mexican border and Ceuta, workers along the German-Dutch border are hardly interested in jobs on the other side. Given their level of cross-border mobility EU-citizens in general, can not be considered really ‘nomadic’ (European Opinion Reearch Group 2001). One even could say that immobility is “a strong and persistent behavioural strategy for the large majority of the population” (Fischer et al. 2000, p.32). In fact, the 2001 Eurobarometer shows that no more than 1.7 percent of all respondents had moved to another country within the European Union in the past decade (European Opinion Research Group 2001). Of course there are differences, with the lowest figure in Ireland (less than half a percent) and the highest in the Scandinavian countries (Finland 3 percent, Denmark a little over 4 percent and Sweden 5 percent). Given this low level of mobility in recent years, it is no surprise that all in all less than 2 percent of the total working population in all member states of the EU-15 comes from other EU-15 countries (Eurostat 2002). Although this share is growing (Kiehl & Werner 1999), it is still not very impressive (figure 4). Figure 4 deals with migration, but when cross-border commuting is added, the picture does not really change. In border regions, defined as NUTS-3 regions (the smallest administrative region for which Eurostat provides statistical data), only 1.5 percent of all workers commutes across the border, in absolute figures 500,000 workers out of a total workforce of 34 million (MKW 2001). Although here too, considerable differences can be noticed, the overall picture again is one of low cross-border intensities. Anul VIII, nr. 16
145 Yet it is clear that the context along the inner EU-borders has changed substantially in the last 50 years. Within the Schengen-area, crossing a national border is hardly restricted anymore. What were the consequences of this change? An interesting case has been presented at a workshop organised for German and Dutch economic geographers in early 2003 (van Vilsteren & Wever, 2005), about the German-French Saar-Lorraine region (Dörrenbächer & Schulz 2005). In this region the number of cross-border economic relationships has increased considerably, in particular commuterflows and foreign direct investments. The motivations behind this increased crossborder interaction were mainly economically motivated: lower wages and real estate prices in Lorraine. However, crossborder private and personal relationships did not develop in the same way, according to the authors mainly because of cultural differences. They even suggest that when the economic differentials on both side of the border disappear the economically motivated cross-border interaction will come to an end. In other words, at the moment we reach the desired EU goal of more cross-border cohesion by enhanced economic interaction, we might see declining levels of cross-border interaction. 20
20
The international orientation of Luxemburg may account for the extreme percentage of nonnatives in this small country.
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3 Labour mobility and the mental openness of the border and mobility As we saw before (figure 4) labour is still very much immobile within the integrated EU. It is this relative immobility on the labour market that we focus upon in this part of our contribution. Which factors can explain this relatively high level of immobility? We concentrate on the role of national borders within the EU for the behaviour on the labour market of individual persons. Then we see borders not as administrative, historic and more or less arbitrary lines on a map, but as actively constructed, reconstructed and experienced demarcations between groups of people. These demarcations have a distinct influence on the perceptions shared by those living on both sides of the border and these perceptions have their influence on everyday spatial behaviour. Before we deal with the exact situation along the integrated Dutch-German border we first deal with some general explanations for (a) mobility on the labour market, explanations that hold especially along ‘interdependent borders’, and for (b) immobility, that can be noticed alongside the ‘integrated’ inner EU
borders.
0.30% 0.30% 2.24% 2.24%
0.96% 0.96% 3.32% 3.32%
1.74% 1.74%
1.60% 1.60% 2.84% 2.84% 6.05% 6.05% 39.89% 39.89%
2.36% 2.36%
1.65% 1.65%
0.11% 0.11% 0.33% 0.33% 0.49% 0.49%
0.23% 0.23%
Figure 4: Share of foreign-born workers from other EU-15-countries in the active population Source: Eurostat Labour Force Survey, 2001 and own calculation
Explaining mobility and immobility As we already discussed, even within the EU-15, labour mobility is low. The inter-state mobility in the US is about six times as high (European Commission (2001, p.6). Although this com-
Jurnalul Economic parison might not hold completely, this US figure is often used by the EC as a standard that should be aimed for. How can this low level of mobility in the EU be understood? Theories explaining mobility are often used as well to explain immobility. The labour market is often regarded as a kind of system that is in (a process towards) a state of equilibrium. Viewed in this perspective, disequilibria between demand and supply are regarded as a temporary phenomenon. They will level off in due course since they stimulate mobility. Workers from an area with an oversupply, and as a consequence low wages, will move to an area with a lack of workers and consequently higher wages. Mobility is the ‘big equaliser’, playing a crucial role in the functioning of labour markets. The mobility-approach often departs from assumptions already formulated in the 1880’s by Ravenstein (1885). He considered regional wage differences as the basic principle underlying labour migration. Since then, explanatory models have become more complex. Other aspects are included, for example a concept like ‘human capital’ (Becker, 1962), that links the decision to migrate for work reasons to new investments in education or learning experiences that could be profitable in the long run. Also the notion of ‘bounded rationality’ was introduced (Simon, 1982), stating that workers, in their decision to migrate or not, simply cannot decide like an ideal home economicus, since they don’t have all the information they need and part of the information they have is distorted. Again another notion is ‘transaction costs’, stating that all kinds of transactions and as a consequence decisions, inAnul VIII, nr. 16
147 volve indirect costs, relating partly to another culture, but as well to different legal procedures, etc. However, even when these aspects are included, the explanation still departs from a push-pull model (figure 5), in which factors are taken into account, that make people move from one place to another. The situation along the US-Mexico and the EU-Africa border fits reasonably well in such a model. We will come back on that later on. However, in many cases such a push-pull model overestimates the level of labour mobility. This especially holds for the inner EU borders, like the one between Germany and the Netherlands, where immobility is the rule. There we should less focus on factors that make people move, but on factors that make them stay. Straubhaar and others (1988) developed the so-called ‘insiders advantage approach’ (Straubhaar 1988, Tassinopolous and Werner 1999, Fischer 1999). This approach tries to attach an economic value to being immobile, by introducing a third category of factors, the ‘keep’-factors. An example are the work-experiences or competences built up by workers in practice. If an employer on the other side of the border is not interested in these experiences a worker has to weigh the profit he can make when he moves against the loss of these competences. When a worker is strongly socially embedded in a region, is happy there, that can keep him in his home area as well. This can be linked up with the concept of ‘psychic income’ introduced by Greenhut (1956). In addition to such keep-factors, we can also include repelfactors. These factors are linked to the potential destination region, for example when that region is characterised
Iunie 2005
by traditional resentments towards foreigners, when the region has an unfavourable regional images, for example because of high crime rates. Such repel factors might prevent people from going there. An approach, which includes ‘keep’ and ‘repel factors’, still fits into the tradition of rational choice approaches. It presupposes actors who are constantly in a process of deliberation, who are engaged in weighing the pros and cons of different places or regions. In other words, it supposes that these actors are willing and are able to evaluate between the HERE and THERE, in our case the area on this side of the border and the area on the other side. However, in everyday life, most workers do not continuously make a rational costs/benefitanalysis between staying ‘at home’ or going abroad. Therefore we include the notion of ‘threshold of indifference’ to explain labour immobility. In order to explain what is meant by this notion, we start with the rationality of belonging. It is said often that in our globalising world, within the European Union as well, people increasingly use to claim a part of that space as theirs (Van Houtum & Van Naerssen, 2002). There seemingly is a need to belong somewhere or to feel at home in a specific region. This can be linked to the notion of psychic income as used by Greenhut, but it is trying to expand this notion beyond the realm of economic rational choice approaches. The evermore-expanding European Union seems to be incapable to function as such a place of belonging. People need other spatial frameworks for their feelings. One of the consequences of using the notion of a space of belonging is that a mental distance is created between
places on both side of the border. At someone’s own side of the border a space of belonging is created, with ease and comfort, where mental nearness to the other inhabitants exists: WE in the HERE. The other side is not a space of ease or comfort, it is another ‘world’: THEY in the THERE. The consequence of this process is that a space of indifference is created (Van Houtum, 2003); a space that is neither consciously nor unconsciously included in the search for a new job. It creates (consciously or unconsciously) a threshold that has to be overcome before the THERE is included in the search for a job. Figure 5 tries to elucidate the ‘dynamics’ in the cross-border labour market. This model is developed in the context of an already very much integrated region like the EU-15, where contrary to the expectations, lifting the border did not result in a major increase in labourmarket-mobility. In such a situation explaining immobility instead of mobility is an important task. We deal with that aspect. However, the model can also be used in situations where integration has not developed to the same extent, for example at the US-Mexico-border or the outer border of the (enlarged) EU. One has to keep in mind that the differences on both sides of the border are extremely important for transgressing the ‘threshold of indifference’, since there is a relation between the factors at play in the process of economic rational decision making. When these factors (like incomedifference, unemployment-rates) are big, one could expect that persons might be less ‘indifferent’, implying that the ‘there’ is considered an alternative option. But as said, we will deal only with the integrated inner EU (15) borders.
Cross-border labour market
Indifference-factor
passiveness
Threshold of indifference
Stay
Keep-factor
Repel-factor
Go
Push-factor
Pull-factor
Home
Away
Cross-border labour market activeness
Figure 5: Factors influencing individual spatial behaviour on the labour market Source: Based on Van der Velde, et. al., 2005 Along such borders several outcomes are possible, resulting in mobility as well as in immobility. When a large group of people exhibits an indifferent attitude towards job opportunities on the other side of the border, immobility will be the rule. That situation exists along the Dutch-German border, perhaps as well along other inner EU borders. The other extreme holds for the ‘interdependent borders’, especially the ones between the US and Mexico and between the EU and Africa, where life itself is at stake for the workers from Mexico and Africa, and people are ‘desperately’ seeking alternatives for their current situation. Workers from the countries that joined the EU in 2004 take a middle position. In the earlier mentioned European opinion poll, they showed no big desire to move (Bruinsma & Hakfoort, 2005), for them ‘keep’ and ‘repel factors’ are already more important than the authorities in the old member states realise.
4
Conclusion
There are quite different types of borders, resulting in quite different types and intensities of interaction between the border regions connected with them. ‘Interdependent borders’, like the ones between the US and Mexico and the outer EU border, generate a lot of legal and illegal economic interaction, based primarily on differences in costs and wages. Regions with inner EU ‘integrated borders’, where all ‘technical’ barriers have been eliminated, are often seen as regions that profit strongly from the integration process, resulting in all kinds of cohesion processes. But reality tells another story. Even when a border is officially abolished, it has a strong impact on the spatial behaviour of those living on both sides of it. Although labour can move freely within the EU, the number of cross-border commuters is amazingly small. Workers are more or less ‘locked in’ in their own (institutional) framework.
150 As that framework in many respects does not cross a national border, not even an ‘integrated border’, workers are just as in the past focussed on jobs on their own side of the border. In that sense there is a clear ‘indifference’ towards the other side, resulting in a threshold that has to be surpassed before even considering becoming mobile. An after this threshold is taken, there are still ‘keep factors’ and ‘repel factors’ that create just another threshold, which in its turn might often be too high for workers to consider taking jobs available on the other side of the border. In such a situation immobility is the rule. References Becker, G. (1962), Investment in human capital: a theoretical analysis. The Journal of Political Economy, 70, pp.9-49 Bruinsma, W. & J. Hakfoort (2005), The enlargement of the European Union: the implications for the Netherlands. In. W. Bruinsma, J. Hakfoort & E. Wever (eds), The expansion of the EU: between hope and fear. Assen, Van Gorcum, pp.23-39 Dörrenbächer, P. & C. Schulz (2005), Economic integration in the SaarLorraine border region. In. G. van Vilsteren & E. Wever (eds), Borders and economic behaviour in Europe. Assen: Van Gorcum, pp. 10-25 European Commission (2001) New European labour markets, open to all, with access for all. Available HTTP: (accessed 6 August 2005). European Opinion Research Group (2001), The social situation in the European Union. Available HTTP: (accessed 6 August 2005) Eurostat (2002) Labour force survey: results 2001, Luxembourg: Office for Official Publications of the European Communities. Fischer, P. (1999), On the economics of Immobility: regional developments and migration in the age of globalisation. Bern: Haupt Greenhut, M.L. (1956), Plant location in theory and in practise: the economics of space. Chapel Hill: University of North Carolina Press. Houtum, H. van & T. van Naerssen (2002), Bordering, ordering, othering. Tijdschrift voor Economische en Sociale Geografie, 93, pp.125-136 Houtum, H. van (2003), ‘Borders of comfort’. Regional and Federal Studies, 12, pp.37-58. Janssen, M. (2000), Borders and Labour-market Integration: Where is the difference between Interregional and Cross-border Mobility? In: H. van Houtum & M. van der Velde (eds), Borders, Regions and People. London: Pion Kiehl M. & H. Werner (1999), The labour market situation of EU and thiord country nationals in the European Union (IAB Labour Market Research Topics 32). Nürnberg: IAB Martinez, O. J. (1994), The Dynamics of Border Interaction. In: Clive Shofield (ed), Global Boundaries-World Boundaries. London: Routledge, pp.1-15 Molle, W. (2005), EU expansion towards the East: lessons from past experience. In: W. Bruinsma, J. Hakfoort & E. Wever (eds), The expansion of the EU: between hope and fear. Assen: Van Gorcum, pp.7-23 Papapanagos, H. & R. Vickerman (2000), Borders, Migration, and Labourmarket Dynamics in a Changing Europe. Iunie 2005
Jurnalul Economic In: H. van Houtum & M. van der Velde (eds), Borders, Regions and People. London: Pion Ravenstein, E. (1885), The Laws of migration. Journal of the Statistical Society of London, 48, pp.167-235 Simon, H.A. (1982), Models of Bounded Rationality: Behavioral Economics and Business Organization. Vol.2. Cambridge: MIT Press Straubhaar, T. (1988), On the economics of international labour migration. Bern: Haupt Tassinopoulos, A. & H. Werner (1999), To move or not to move: migra-
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151 tion in the European Union (IAB Labour Market Research Topics 35). Nürnberg: IAB Velde, M. van der, M. Janssen & H. van Houtum (2005), Job mobility in the Dutch-German regional labour market. The trheshold of indifference. In: G. van Vilsteren & E. Wever (eds), Borders eand economic behaviour in Europe. Assen: Van Gorcum, pp. 77-96 Vilsteren, G. van & E. Wever (2005), Borders and economic behaviour in Europe. A geographical approach. Assen: Van Gorcum.
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