Background: The ‘Reinforcing Rural Resilience’ report was launched in the OECD regional development Ministerial meeting in Warsaw, Poland, and presented in the EU Rural Pact Conference in Courtrai, Belgium on 16 September. The first OECD Latin America Rural conference is an opportunity to launch the Policy Highlights in Spanish and Portuguese and further disseminate the findings throughout Latin America.
In the popular mindset, rural regions often conjure up images of dereliction and decline. Yet this is far from the reality.
Rural areas are home to 30% of the OECD population and in some cases are outpacing cities in growth, productivity, and innovation. Why then do outdated narratives of rural decline continue to overshadow their contributions? It is time to dismantle the myths holding these regions back.
Myth one: rural regions are uniformly declining
Many OECD countries are struggling with low productivity and slow growth, and too often the rural contribution to performance is overlooked. While it is true that the gap between big cities and the rest of the country has widened since the 2008 crisis, the reality is more complex.
In fact, in 12 countries, rural regions contributed more than 30% of national growth. And in 11 OECD countries – including Austria, Estonia, Finland, Germany, Japan, and Portugal – more than half of rural regions recorded higher GDP per capita growth than their national average (2001-21). In one striking example, in Scotland, United Kingdom, remote areas accounted for more than 80% of total productivity growth between 2010 and 2018, while urban areas made a net negative contribution.
Share of rural regions growing above national average for GDP per capita
Myth two: rural regions are uniformly shrinking
It is true that 40% of rural remote regions saw populations fall over the past two decades and these trends are expected to continue. Outmigration of young people adds to ageing pressures.
Yet, here again, the story is more complex. In 17 OECD countries population increased in rural regions, in particular the ones close to cities.
More generally, mobility has been touted as the silver bullet, as if people who cannot find opportunities in a place should just move to another. Today however, the policies borne out of this approach are falling short because people are as not as mobile as often assumed. On average, only around 2% of the OECD population moves between regions each year.
That is why the “right to stay” policy objective set out by the European Commission is an important one. OECD analysis shows that regional attractiveness depends on enabling factors: transport connections, quality internet, services like health and education, and affordable housing.
Myth three: rural economies lack innovation
It is also wrong to assume that rural communities lack innovation when in fact innovation in these areas is not limited to the purely technological but also encompasses the non-technological such as social, organisational and service based.
A good example of successful social innovation can be seen in Scotland, where the Highlands and Islands Enterprise Agency works with businesses and social enterprises, providing support to those organisations thinking to relocate or expand to their region. As of 2024, the Agency has created and retained 1 200 jobs, across 82 fragile areas, producing a turnover increase of £619.7m for their businesses.
Most importantly, diffusion of innovation matters as much as invention, and adopting and adapting existing technologies is a main driver of rural productivity. In the US for example, over a third of all productivity growth in US rural counties from 2010-20 was due to more efficient use of resources, including skills and technology adoption.
Myth four: Policymakers focus on cities for climate action
Rural regions generate 63% of the total renewable electricity across the OECD. With nearly 200 countries committing to triple the world’s renewable capacity by 2030, it is rural areas who possess the highest untapped potential of renewable energy. In the EU, rural areas possess the highest untapped potential of renewable energy production – nearly 80% – according to the EU Joint Research centre.
Pathways forward to unlock rural potential
Rural regions need to stop being framed through decline and urban bias but rather as diverse places of resilience and innovation. The recently released OECD report on Reinforcing Rural Resilience challenges some myths about rural decline and highlights six proven pathways to unlock rural potential.
Build on strengths
First, it calls for building on rural strengths including local assets, tradable specialisations and natural resources to drive growth in sectors like manufacturing and renewables. One in five rural jobs is in manufacturing, and its share of rural value-added has grown over the past 2 decades (from 18.5% in 2000 to 21% in 2019).
With digital manufacturing, this is expected to continue. In Arezzo, Italy the traditional textile industry has been modernised through innovative computer-aided design and taken advantage of its proximity to Milan to access wider markets.
Connect those hardest to reach
Second, investing in digital infrastructure is critical. Internet speed is still on average 30% slower in rural areas across OECD countries. Addressing the urban-rural digital divide holds significant potential for rural regions, notably to diversify the rural economy, support rural entrepreneurship and create opportunities through public-private partnerships for innovation and public service delivery. Korea shows what’s possible: since 2010, proactive rural broadband policies have made it the OECD country with the smallest rural–urban digital gap.
Invest in rural-urban partnerships
Third, improving access to services through better transport, co-location, and digital delivery enhances rural attractiveness. This also means fostering rural-urban partnerships to foster cooperation, instead of competition, between rural and urban areas. In Texas and North Carolina, United States, rural communities have been linked with urban healthcare providers through mobile health units and telehealth initiatives.
Mainstream rural policy
Fourth, mainstream rural policy and adapt it to local realities. Place-based approaches is essential, since the needs of remote rural, rural near cities, and intermediary cities differ widely and as a one-size-fits-all approach won’t deliver results.
Rural development cuts across many policy areas: agriculture, housing, transport, education, health, digital and labour markets. The policy portfolio to rural development must go beyond sectoral approaches. Rural proofing is one tool increasingly used in countries like Canada, Chile, Finland, Ireland, Spain, and Sweden.
Work from the bottom-up
Fifth, empower regional and local governments with resources, skills, and revenue capacity to enable more bottom-up development. Under the right conditions, giving local authorities more control over resources can encourage more proactive and targeted development, that better reflects local realities.
Finally, rural people must be engaged in shaping policies. Governance tools should bring local voices into decisions early through partnership councils, contractual arrangements, rural brokers or informal platforms. There has been success in Australia through the Regional Development Australia (RDA) initiative. Local leaders receive targeted training that equips them to act as trusted connectors between their communities and government agencies across sectors ranging from energy to education.
The European LEADER Programme seeks to do this by engaging local actors through Local Action Groups and tailoring development strategies to the needs of each area.
Rural regions can be the solution
Debunking myths doesn’t mean challenges are insignificant. But it shows clearly that rural regions are not just part of the problem. They are part of the solution. Rural regions matter for aggregate growth in OECD countries, and they can help build more competitive economies. We must prevent the widening rural discontent in OECD countries and place a stronger focus on rural well-being and rural transformation.
By leveraging opportunities across renewable energy, digital innovation and advanced manufacturing we can ensure not only that they are not left behind, but that our countries thrive.
For further reading, check out the reports, check out the reports Place-Based Policies for the Future and Reinforcing Rural Resilience. Take a look at the OECD Latin American Rural Development Conference 2025 taking place in Rio de Janeiro.
Dorothée Allain-Dupré is Head of the Regional Development and Multi-level Governance Division within the Centre for Entrepreneurship, SMEs, Regions and Cities of the OECD. She oversees a team of 35 experts providing governments with evidence, data, analysis, policy advice and recommendations to strengthen the competitiveness and resilience of regions, mitigate regional disparities, and improve multi-level governance and subnational finance. She oversees OECD programmes on regional development, rural development and regional attractiveness, multi-level governance, decentralisation, and subnational finance and investment, among other areas. In her position, Dorothée is driving the work of the OECD’s Regional Development Policy Committee.
A French national, Ms Allain-Dupré holds a master’s degree in Public Policy from École Doctorale Sciences-Po (France), a master’s degree in European Studies from the University of Sussex (UK), and a bachelor’s degree in Public Affairs from Institut d'Etudes Politiques, Sciences-Po (France).