The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy
The smart specialization concept was implemented in the EU in 2014, stating that regions have to specify specialization areas for development of innovations. Economic specialization reveals a comparative advantage in that field. However, there are different arguments linking specialization to econom...
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| Format: | Article |
| Language: | English |
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MDPI AG
2021-05-01
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| Series: | Economies |
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| Online Access: | https://www.mdpi.com/2227-7099/9/2/76 |
| _version_ | 1827692735401820160 |
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| author | Giedrė Dzemydaitė |
| author_facet | Giedrė Dzemydaitė |
| author_sort | Giedrė Dzemydaitė |
| collection | DOAJ |
| description | The smart specialization concept was implemented in the EU in 2014, stating that regions have to specify specialization areas for development of innovations. Economic specialization reveals a comparative advantage in that field. However, there are different arguments linking specialization to economic development. This study analyzes these arguments and aims to investigate the impact of economic specialization on regional economic development and to give insights into identifying prospective areas in regional economies. A panel fixed effect estimation of industry-level regional data suggests that economic specialization in broader regional employment, called relative specialization, is ambiguously associated with economic development. Our findings suggest that neither economic specialization nor economic diversity are a clear-cut solution for ensuring economic growth. Economic structure in EU regions differs, and there is no one answer for which approach is better for economic development. Specialization measures, particularly the location quotient, cannot fully capture the dynamics in the industry structure that could be essential for formation of regional development strategy. |
| first_indexed | 2024-03-10T11:28:09Z |
| format | Article |
| id | doaj.art-cab148a8b86e47479d4b0adf6accb3f3 |
| institution | Directory Open Access Journal |
| issn | 2227-7099 |
| language | English |
| last_indexed | 2024-03-10T11:28:09Z |
| publishDate | 2021-05-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj.art-cab148a8b86e47479d4b0adf6accb3f32023-11-21T19:30:04ZengMDPI AGEconomies2227-70992021-05-01927610.3390/economies9020076The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization StrategyGiedrė Dzemydaitė0Faculty of Economics and Business Administration, Vilnius University, Saulėtekio av. 9, LT-10222 Vilnius, LithuaniaThe smart specialization concept was implemented in the EU in 2014, stating that regions have to specify specialization areas for development of innovations. Economic specialization reveals a comparative advantage in that field. However, there are different arguments linking specialization to economic development. This study analyzes these arguments and aims to investigate the impact of economic specialization on regional economic development and to give insights into identifying prospective areas in regional economies. A panel fixed effect estimation of industry-level regional data suggests that economic specialization in broader regional employment, called relative specialization, is ambiguously associated with economic development. Our findings suggest that neither economic specialization nor economic diversity are a clear-cut solution for ensuring economic growth. Economic structure in EU regions differs, and there is no one answer for which approach is better for economic development. Specialization measures, particularly the location quotient, cannot fully capture the dynamics in the industry structure that could be essential for formation of regional development strategy.https://www.mdpi.com/2227-7099/9/2/76economic structureeconomic specializationsmart specializationeconomic growthEU regionstradable sectors |
| spellingShingle | Giedrė Dzemydaitė The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy Economies economic structure economic specialization smart specialization economic growth EU regions tradable sectors |
| title | The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy |
| title_full | The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy |
| title_fullStr | The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy |
| title_full_unstemmed | The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy |
| title_short | The Impact of Economic Specialization on Regional Economic Development in the European Union: Insights for Formation of Smart Specialization Strategy |
| title_sort | impact of economic specialization on regional economic development in the european union insights for formation of smart specialization strategy |
| topic | economic structure economic specialization smart specialization economic growth EU regions tradable sectors |
| url | https://www.mdpi.com/2227-7099/9/2/76 |
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