1. © IREA 2007 Urban dynamics in metropolitan areas The case of Barcelona (Economics, planning and corruption) Vicente Royuela (AQR-IREA, UB) Barcelona December 17th 2007

2. © IREA 2007 For many people corruption equals economic speculation: too much market on the housing market What can we say as economists?

3. © IREA 2007 Outline: 1. Economics 2. Planning 3. Corruption Several examples on the province of Barcelona and Catalonia will arise

4. © IREA 2007 Economics 1.Individual behaviour 2.Space segmentation 3.Non homogeneity in space

5. © IREA 2007 Economics 1.Individual behaviour

6. © IREA 2007 Economics 1.Individual behaviour (Duglas, 1997, Wall, 2001) Where: U: Utility of individual k in location i A: Amenities in location I E: Economic factors in location I ik: Idionyncratic factors of individual k in location i Finally, people migrate from i to j if Uj>Ui, after considering a list of costs

7. © IREA 2007

8. Economics 2. Space segmentation Housing market area determination. Two usual choices: - TTWA (Coombes et al 1997) – commuting data - Jones (2002) – migration data Usually these areas depend on the level of self-containment (75%, 60%) and a minimum size threshold (3,500 workers, 20,000 inhabitants) In Royuela and Vargas (2006), these procedures are combined with the Cournot definition of a market area (uniform price) in order to determine the right level of self- containment.

9. © IREA 2007 Economics 2. Space segmentation G B T L L T B G MigrationCommuting

10. © IREA 2007 Economics 3. Non homogeneity in space: it can arise as a consequence of: urban-rural segmentation, urban hierarchies, residential segregation, spatial disequilibrium Figure A5 a. Map of quality of life (ln CQLI) parameter. Model (b). Figure A5 b. Map of quality of life (ln CQLI) t-statistic. Model (b).

11. © IREA 2007 Planning 1956: The law conceded instruments to municipalities to develop local planning, but national policies prevailed, and corruption was quite important. 1978-1997: The Constitution and several sentences conceded policies to regions. Regions develop territorial planning and municipalities urban planning, supervised by the former. Catalonia: the region holds, beside territorial planning, sectoral planning, like Housing planning. The only obliged territorial scope is administrative. Nowadays: new laws concerning territory and urbanism.

12. © IREA 2007 Corruption Transparency International (2007) defines “Corruption”: abuse of a public position for private benefits. We understand that these benefits can “help” private persons, political parties, or even one municipality in contrast to an entire region. For many people corruption equals economic speculation: too much market on the housing market

13. © IREA 2007 Corruption Spain Spring-2007. The maps of corruption

14. © IREA 2007 Corruption Spain Spring-2007. The maps of corruption

15. © IREA 2007 Corruption Recently: Fundación Alternativas (2007) classified 1,339 denounced cases of corruption related with urbanism in Spain between 2001 and 2006, and classified them by topic and region.

16. © IREA 2007 Corruption Recently: Fundación Alternativas (2007) classified 1,339 denounced cases of corruption related with urbanism in Spain between 2001 and 2006, and classified them by topic and region.

17. © IREA 2007 Conclusions 1.Many times, corruption comes as a consequence of a lack of controls. 2.These controls would work much better if the are related to the right territorial framework. 3.Economics may help to define and to evaluate urban and territorial planning. 4.More economically efficient planning processes help to reduce possibilities of corruption.

18. © IREA 2007 Conclusions 1.Many times, corruption comes as a consequence of a lack of controls. 2.These controls would work much better if the are related to the right territorial framework. 3.Economics may help to define and to evaluate urban and territorial planning. 4.More economically efficient planning processes help to reduce possibilities of corruption.

19. © IREA 2007 Conclusions 1.Many times, corruption comes as a consequence of a lack of controls. 2.These controls would work much better if the are related to the right territorial framework. 3.Economics may help to define and to evaluate urban and territorial planning. 4.More economically efficient planning processes help to reduce possibilities of corruption.