Best city to invest in: European Cities Quality Index

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Jose Maria Fernandez-Crehuet ORCID logo, Jorge Rosales-Salas ORCID logo, Rodrigo Avilés ORCID logo

DOI:10.22495/rgcv10i1p1

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Abstract

In this paper, we propose an index to measure the quality of the most important European cities. Using collected data from 66 cities belonging to the 28 countries within the European Union and applying the principal components analysis method, we construct the European Cities Quality Index (ECQI) as a combination of eight dimensions: (1) Public health, (2) Education, (3) Employment and incomes, (4) Environment, (5) Gender equality, (6) Leisure and entertainment, (7) Housing and safety and (8) Transport and mobility, that are in turn made up of 40 distinct variables. We find that London, Aarhus, and Berlin are the cities with the highest scores in the index, with northern European cities performing the best. At the other end of the spectrum, Sofia, Plovdiv, and Bucharest, with severe deficiencies in every dimension, scored worst on the study. The comparisons with the Sustainable Cities Index (Arcadis), the Global Power City Index (Institute for Urban Strategies), Cities in Motion (IESE), the Cities Prosperity Index (UN), and Dynamic Cities (Savills) help us understand the potential use of this new index and its purpose as a tool for assessing public policy. The ECQI could be used to assist public policies designed to improve perception in regions where it is needed.

Keywords: City Quality, Principal Components Analysis, Quality of Life, European Cities Quality Index

Authors’ individual contribution: Conceptualization – J.M.F.-C. and R.A.; Methodology – J.M.F.-C.; Formal Analysis – J.R.-S.; Investigation – R.A.; Writing-Original Draft – R.A.; Writing-Review&Editing – J.M.F.-C. and J.R.-S.; Visualization – R.A.; Supervision – J.M.F.-C.; Project Administration – J.M.F.-C. and R.A.

JEL Classification: I310, R110, Y100

Received: 29.11.2019
Accepted: 20.01.2020
Published online: 22.01.2020

How to cite this paper: Fernandez-Crehuet, J. M., Rosales-Salas, J, & Avilés, R. (2020). Best city to invest in: European Cities Quality Index. Risk Governance and Control: Financial Markets & Institutions, 10(1), 8-22. http://doi.org/10.22495/rgcv10i1p1