New OECD Report: Regional Inequalities on the Rise

  • From Sonja Hennen
  • Reading duration 2 min

Regional income disparities have increased in more than half of OECD countries over the past 20 years, according to OECD Regional Outlook 2023.

Regional disparities within OECD countries have remained high over the past two decades - and in many countries they have worsened. This is shown in the recently published OECD Regional Outlook 2023. For example, GDP per capita in metropolitan regions - whose growth is an important driver of regional disparities - is on average about 30 per cent higher than the national average.

The impact of recent shocks, including the COVID-19 pandemic and the Russian attack on Ukraine, as well as other global megatrends, threatens to exacerbate these regional disparities. Longstanding geographical inequalities are thus being cemented.

The authors of the study warn that regional inequalities weaken the economic, social and political fabric in the long run and lead to a geography of discontent. At the same time, they point out that rising regional disparities are not inevitable, but can be successfully tackled with the right policies. To do this, they say, it is essential to raise productivity, especially in regions that are lagging behind. Investing in the quality of public services and promoting knowledge and innovation networks is also essential.

READ THE FULL REPORT.