The economic dynamism indices of cities and municipalities in metropolitan areas are spatially correlated, which suggests “complementation” rather than competition

01 Mar 2024

UP Diliman

The measurement of cities and municipalities competitiveness in the Philippines has been put in place by the Department of Trade and Industry since 2013. However, its use as a spatial planning parameter is lacking in the literature. This paper reviewed the factors that drive competitiveness. The research revealed that “economic dynamism” appeared at the top of the factors that contributed to competitiveness and influenced regional development. Given urban and regional planning theories, metropolitan areas were chosen as the most appropriate case study sites that exhibit economic dynamism. The study revealed that the “Economic Dynamism Index” or EDi of cities and municipalities were spatially correlated, indicative of their clustering pattern in the economic space. The clustering pattern was determined by treating the EDi as a spatial attribute in the major metropolitan case study areas. Using Moran’s I global spatial autocorrelation analysis, the clustering pattern of cities and municipalities observed through the GIS map was validated by the 99% significance in the spatial statistics of the EDi dataset. This suggests that “complementation” among cities and municipalities exists rather than competition. Thus, sustainable regional spatial/economic development strategies can be reformulated, given the spatial interactions of areas with higher EDi with the less endowed cities/municipalities at the periphery.

In terms of its significance to urban and regional planning literature, the research reinforces the theoretical assumptions of spatial dependence among cities following the Theory of Competitive Advantage, Growth Pole Theory, and Theory of Uneven Growth. For local development planning, the study serves to reformulate or enhance regional development strategies introduced in the medium-term (every six years) by the central planning unit – the National Economic and Development Authority.

The spatial association of cities in terms of the economic dynamism of cities, measured through the Economic Dynamism Index, described in the study serves as a guide to local planning offices of the local government units (LGUs) and regional groupings of the national government agencies in preparing development plans. For the LGUs, the research provides input to the formulation of the mandated local development plans espoused in the Local Government Code (Republic Act 7160) to include the Comprehensive Land Use Plan (CLUP) and the Comprehensive Development Plan. These plans will cushion the negative implication of “backwash/polarization” to less
competitive cities and municipalities regardless of their income class.

Authors: Ronnie H. Encarnacion, Dina C. Magnaye and Annlouise Genevieve M. Castro (School of Urban and Regional Planning, University of the Philippines Diliman)

The economic dynamism indices of cities and municipalities in metropolitan areas are spatially correlated, which suggests “complementation” rather than competition

The measurement of cities and municipalities competitiveness in the Philippines has been put in place by the Department of Trade and Industry since 2013. However, its use as a spatial planning parameter is lacking in the literature. This paper reviewed the factors that drive competitiveness. The research revealed that “economic dynamism” appeared at the top of the factors that contributed to competitiveness and influenced regional development. Given urban and regional planning theories, metropolitan areas were chosen as the most appropriate case study sites that exhibit economic dynamism. The study revealed that the “Economic Dynamism Index” or EDi of cities and municipalities were spatially correlated, indicative of their clustering pattern in the economic space. The clustering pattern was determined by treating the EDi as a spatial attribute in the major metropolitan case study areas. Using Moran’s I global spatial autocorrelation analysis, the clustering pattern of cities and municipalities observed through the GIS map was validated by the 99% significance in the spatial statistics of the EDi dataset. This suggests that “complementation” among cities and municipalities exists rather than competition. Thus, sustainable regional spatial/economic development strategies can be reformulated, given the spatial interactions of areas with higher EDi with the less endowed cities/municipalities at the periphery.

In terms of its significance to urban and regional planning literature, the research reinforces the theoretical assumptions of spatial dependence among cities following the Theory of Competitive Advantage, Growth Pole Theory, and Theory of Uneven Growth. For local development planning, the study serves to reformulate or enhance regional development strategies introduced in the medium-term (every six years) by the central planning unit – the National Economic and Development Authority.

The spatial association of cities in terms of the economic dynamism of cities, measured through the Economic Dynamism Index, described in the study serves as a guide to local planning offices of the local government units (LGUs) and regional groupings of the national government agencies in preparing development plans. For the LGUs, the research provides input to the formulation of the mandated local development plans espoused in the Local Government Code (Republic Act 7160) to include the Comprehensive Land Use Plan (CLUP) and the Comprehensive Development Plan. These plans will cushion the negative implication of “backwash/polarization” to less
competitive cities and municipalities regardless of their income class.

Authors: Ronnie H. Encarnacion, Dina C. Magnaye and Annlouise Genevieve M. Castro (School of Urban and Regional Planning, University of the Philippines Diliman)