engleski

Regional Imbalance as the Constraint in Enhancing National Competitiveness

Achieving and sustaining national competitiveness, defined as the ability of a nation to create and maintain an environment which sustains the competitiveness of its enterprises, under the condition of globalization and increasing international competition, has become the country's top priority. Only highly competitive economies can effectively cope with the domestic and international competition and produce target outcomes in the context of international specialization. National competitiveness, implying the components of productivity, efficiency and effectiveness, contributes to the acceleration of economic growth, increasing standard of living and social welfare, creating new jobs and resolving other economic problems. This paper is based on three hypotheses. First, national competitiveness varies considerably in the time-space framework depending on the long-term determinant of productivity which is rooted in microeconomic conditions in the economy, unique national and regional framework conditions and relevant external environment. Second, national competitiveness is based on regional and micro competitiveness. Regional (local) competitiveness implies identification of developmental potentials and constrains of some areas and enhancing its unique combination of resources (innovativeness and creativity, knowledge, technology, historic and cultural inheritance, etc.). Third, regional imbalance, measured through real GDP growth rates and per capita real output, as well as other indicators, is a basic characteristic of modern economies. The main purpose of this paper is to explore the relation between the regional imbalance and the national competitiveness taking into consideration the influence that the regional imbalance has on Croatian competitiveness. Further regional imbalance makes Croatian competitiveness grow slower in comparison with the competitiveness of the selected countries in Central and Eastern Europe. These countries improve their competitiveness much faster than Croatia. Since national competitiveness can not be sustained and improved effectively if there is a significant regional imbalance, policy implications directed to fostering regional development are also discussed in this paper.

national competitiveness; economic development; regional imbalance; regional policy

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