DIVERCITIES Governing Urban Diversity: governing urban diversity Creating Social Cohesion, Social Mobility and Economic Performance in Today’s Hyper-diversified Cities Dealing with Urban Diversity Dealing with This book is one of the outcomes of the DIVERCITIES project. It focuses on the question of how to create social cohesion, social Urban Diversity • mobility and economic performance in today’s hyper-diversified cities. The Case of Budapest The Case of Budapest The project’s central hypothesis is that urban diversity is an asset; it can inspire creativity, innovation and make cities more liveable. There are fourteen books in this series: Antwerp, Athens, Szabolcs Fabula Lajos Boros Budapest, Copenhagen, Istanbul, Leipzig, London, Milan, Dániel Horváth Paris, Rotterdam, Tallinn, Toronto, Warsaw and Zurich. Zoltán Kovács This project has received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under www.urbandivercities.eu grant agreement No. 319970. SSH.2012.2.2.2-1; Governance of cohesion and diversity in urban contexts. DIVERCITIES: Dealing with Urban Diversity The Case of Budapest Szabolcs Fabula Lajos Boros Dániel Horváth Zoltán Kovács Governing Urban Diversity: Creating Social Cohesion, Social Mobility and Economic Performance in Today’s Hyper-diversified Cities To be cited as: Fabula, S., L. Boros, D. Horváth and Lead Partner Z. Kovács (2017). DIVERCITIES: Dealing with Urban - Utrecht University, The Netherlands Diversity – The case of Budapest. Szeged: University of Szeged. Consortium Partners - University of Vienna, Austria This report has been put together by the authors, - University of Antwerp, Belgium and revised on the basis of the valuable comments, - Aalborg University, Denmark suggestions, and contributions of all DIVERCITIES - University of Tartu, Estonia partners. - University Paris-Est Créteil, France - Helmholtz Centre for Environmental The views expressed in this report are the sole Research – UFZ, Germany responsibility of the authors and do not necessarily - Fachhochschule Erfurt, Germany reflect the views of the European Commission. - National Centre for Social Research (EKKE), Greece - University of Szeged, Hungary - University of Urbino Carlo Bo, Italy - University of Amsterdam, Netherlands - Delft University of Technology (TUDelft), The Netherlands - Polish Academy of Sciences, Poland - synergo Mobility-Politics-Space GmbH, Switzerland - Middle East Technical University (METU), Turkey - University College London, United Kingdom Advisory Board - Jan Vranken, University of Antwerp, Belgium - David Hulchanski, University of Toronto, ISBN 978 90 6266 452 8 Canada © 2017 All rights reserved. No part of this publication may be reproduced in any form, by print or photo print, microfilm or any other means, without written permission by the publishers. Copy Editors: Melissa Lee and David Wills Cover Image: Szabolcs Fabula Design & Layout: C&M, Faculty of Geosciences, Utrecht University, The Netherlands Printed by: Xerox, The Netherlands A digital version of this report is available on the DIVERCITIES website: http://www.urbandivercities.eu In memory of Ronald van Kempen CONTENTS Preface 7 1 Dealing with urban diversity: an introduction1 9 1.1 Introduction 9 1.2 The purpose of the book 11 1.3 Diversity and its effects: some key arguments3 12 1.4 The outline of this book 19 2 Budapest as a diverse city 21 2.1 Locating Budapest 21 2.2 Diverse-city Budapest 24 2.3 Socio-spatial dynamics of diversity in Budapest 28 2.4 Diversity, economic dynamics and entrepreneurship in Budapest 32 2.5 Challenges and opportunities of Budapest as a diverse city 34 3 Policy discourses on diversity 37 3.1 Introduction 37 3.2 Methodology 37 3.3 Policy approaches towards diversity at national level 38 3.4 Governmental discourses and the governance of diversity in the city of Budapest 41 3.5 Non-governmental perspectives on the governance of diversity 49 3.6 Conclusions 56 4 Residents dealing with diversity 59 4.1 Methodology 59 4.2 Housing choice and residential mobility 60 4.3 Perceptions of diversity in the neighbourhood 64 4.4 Activities in and outside the neighbourhood 71 4.5 Social cohesion 79 4.6 Social mobility 88 4.7 Perceptions of public policies and initiatives 94 4.8 Conclusion 98 5 Entrepreneurs dealing with diversity 101 5.1 Introduction 101 5.2 Methodology 101 5.3 The entrepreneurs and their businesses 102 5.4 Starting an enterprise in a diverse urban area 107 5.5 Economic performance and the role of urban diversity 116 5.6 Institutional support and government policies 124 5.7 Conclusion 129 6 Conclusions: dealing with urban diversity 133 6.1 Brief summary of the book 133 6.2 Urban diversity as an asset or liability? 136 6.3 Suggestions for policy: how to use the results? 139 References 147 Other cited sources 158 Appendices 161 1. List of the interviewed governmental and non-governmental actors 161 2. Key shifts in national policies regarding migration, citizenship and diversity issues in Hungary 162 3. Major characteristics of the 50 local residents of Józsefváros interviewed during the research 165 4. List of the interviewed entrepreneurs 168 Notes 171 PREFACE This book is one of the outcomes of the DIVERCITIES project. It focuses on the question of how to create social cohesion, social mobility and economic performance in today’s hyper- diversified cities. The project’s central hypothesis is that urban diversity is an asset; it can inspire creativity, innovation and make cities more liveable and harmonious. To ensure a more intelligent use of diversity’s potential, a re-thinking of public policies and governance models is needed. Headed by Utrecht University in the Netherlands, DIVERCITIES is a collaborative research project comprising 14 European teams. DIVERCITIES is financed by the European Commission under the 7th Framework Programme (Project No. 319970). There are fourteen books in this series, one for each case study city. The cities are: Antwerp, Athens, Budapest, Copenhagen, Istanbul, Leipzig, London, Milan, Paris, Rotterdam, Tallinn, Toronto, Warsaw and Zurich. This book is concerned with Budapest. This book is based on a number of previously published DIVERCITIES reports. This book is dedicated to the loving memory of Prof. Dr. Ronald van Kempen, for supporting and coordinating this project until the last days of his life and inspiring us forever… Szabolcs Fabula, Lajos Boros, Dániel Horváth & Zoltán Kovács The Case of Budapest 7 8 DIVERCITIES: Dealing with Urban Diversity 1 DEALING WITH URBAN DIVERSITY: 1 AN INTRODUCTION 1.1 INTRODUCTION By definition, cities are highly diverse. Many have existed for long periods of time and in the process have developed a large diversity in urban neighbourhoods swayed by government input and markets. These neighbourhoods may display a range of housing and environmental characteristics, leading to all kinds of places: enclaves for the rich; slums and ghettos for the very poor; middle-class suburbs; both thriving and degrading inner city districts; gated communities; areas with shrinking populations; and areas with growing populations due to increasing immigration. Residential neighbourhoods may be inhabited mostly by the rich or mostly by poor people, a majority of immigrant groups, or they may be heavily mixed, with the co-existence of many different population groups. Neighbourhoods can be places of intensive contact between groups, or areas for parallel lives where people pass each other like ships in the night with little in common with each other. Areas may be mixed with respect to ‘hard’ variables such as income, education, ethnicity, race, household composition, and age structure, but also on the basis of ‘softer’ characteristics such as lifestyle, attitude and activities. Some people may choose to live in certain areas, while others have little choice. In most urban areas residents live together harmoniously, but in some areas underlying tensions can sometimes erupt into open conflicts between different groups. Even in neighbourhoods with a homogeneous housing stock (in terms of tenure and type) the resident population may be quite diverse. In areas with expensive housing and a concentration of households with relatively high incomes, large differences may exist in terms of lifestyles: some may be more neighbourhood-oriented than others; some may go out every night; whilst others may always be at home in the evenings, leaving their place of residence only to go to work. Areas with relatively cheap housing will, in general, house people and households with (very) low incomes, but the residential population may at the same time be very diverse with respect to lifestyles, attitudes and behaviour and their wishes to stay in the area or to move on. In these areas, the residents may live together happily and take part in and enjoy common activities; or perhaps live parallel lives with minimal interaction; or they may consciously avoid each other due to perceived behaviour or appearance. For many residents with low incomes the possibility to move to another area in the city is limited. Households with low incomes are generally concentrated in neighbourhoods with affordable housing. A number of these neighbourhoods may be characterised as dilapidated areas: the quality of the housing and of public spaces may be worse than in other parts of the city; The Case of Budapest 9 residents may feel more unsafe in such areas; and unemployment and the number of people on welfare benefits may be relatively