REGIONAL COMPETITIVENESS OF THE EUROPEAN UNION

Lela Tijanic () and Alka Obadić
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Lela Tijanic: Juraj Dobrila University of Pula Faculty of Economics and Tourism “Dr. Mijo Mirkovic”

Economy of eastern Croatia yesterday, today, tommorow, 2015, vol. 4, 768-777

Abstract: The aim of this paper is to analyse the competitiveness of the European Union (EU) NUTS 2regions by estimating the regional competitiveness function based on labour (productivity) as the determinant of regional competitiveness. The dynamic panel data analysis is applied in accordance with the explained theoretical framework on defining and measuring regional competitiveness. The results of the study have shown that employment and labour productivity have significant, positive and the highest impact on regional competitiveness, human capital has significant and positive influence while real unit labour costs have significant and negative influence on regional competitiveness of the observed regions in the EU. Human capital is not a significant determinant if the modelling is applied only on convergence regions and regions of the new member countries while unit labour costs are not a significant determinant in the sample of the new member countries of the EU. The results imply that competitiveness is not homogeneous between the regions of the EU and can have implications for regional policy makers, regarding utilisation of examined determinants. The importance of less developed regions should not be disregarded in competitiveness analysis especially if we take into account that this may result in a re-allocation of resources from the less developed to (“better places”) the more developed regions which will contribute to widening inequalities and possibly lower the competitiveness of less developed areas or even problems in more developed regions regarding its capacity and problems of congestion. This has confirmed the need to analyse competitiveness on regional level and that it is necessary to observe regional specificities in future creation of competitiveness measures.

Keywords: regional competitiveness; NUTS; labour productivity; human capital; unit labour costs (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (2)

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