Territorial Review Copenhagen - Region Hovedstaden

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Core Cities‘ efforts to drive up their economic performance. London‘s
successful bid to host the 2012 Olympics, for example, was widely welcomed by
the Core Cities, which are keen for businesses in their cities to exploit the
opportunities this offers.
The Greater London Authority (GLA) has publicly recognised the mutual
interdependence and benefit that exists between London and other cities in the
United Kingdom. In spite of the economic downturn, London remains a net
contributor to the national economy. The report disproved the view that
London‘s growth comes at the expense of the rest of the economy or that the rest
of the United Kingdom is somehow entirely dependent on London‘s success. A
prosperous London and prosperous regional cities are seen as essential to secure
a strong national economic performance. London remains a net contributor to
the national economy. Over the ten years between 1994 and 2004, the GLA
estimated that London contributed between GBP 35 billion and GBP 89 billion
more in tax to the UK economy than it received in public spending (Greater
London Economics, 2005). Their analysis shows that London‘s tax export to the
rest of the country is greater when London‘s economy is flourishing. This
benefits the rest of the country, by helping to fund better public services.
Investment in London to support its continuing economic vitality thus not only
benefits London but the United Kingdom as a whole.
London‘s economic specialisation, with a much larger concentration of
financial, professional and business services and a smaller manufacturing and
public sector than for the rest of the United Kingdom, allows London and the
wider United Kingdom to gain a mutual benefit from inter-regional trade.
London‘s pre-eminent position as a world leader in financial and related
business services links it to all major regions of the global economy. This
benefits the United Kingdom, because London acts as a gateway for investment
and people, both international migrants and tourists. London‘s international
services are available to help businesses across the country and are an asset to all
cities and regions.
It remains to be seen whether regions have enough sticks and carrots to
stimulate municipalities in their region to help in implementing the regional
visions. As mentioned above, regions do not have many instruments to
stimulate municipalities to co-operate in implementing one vision for the
region. The regional government level has in this respect been weakened by
the structural local government reform of 2007, which took away the formal
regional planning capacities that would have made it easier to anchor a
regional vision in policy. Since municipal policies have externalities
(positive or negative) in many cases, over- or under-investment is likely to
occur when no effective co-ordination mechanism exists at the regional
level. Although one could argue that the fiscal equalisation scheme (as
described in Section 3.3) provides such a mechanism, it is a very implicit
arrangement, whose intricacies will only be understood by a few