Nebojša Stojčić

Two Decades of Croatian Transition: A Retrospective Analysis

Abstract Over the past two decades many Central and South East European countries underwent the process of transition from a centrally-planned towards a market economy. Among them, the case of Croatia stands out as particularly interesting. Owing to a number of reasons Croatia had the potential to be among the forerunners of transition. However, in realising this potential the country was constrained by numerous political and social turbulences which made its transition path somewhat unique. The objective of this paper is to explore to what extent the favourable initial conditions of Croatian transition have been exploited over the past two decades. The focus of the analysis is on four dimensions of transition: institutional reforms, macroeconomic performance, changes in economic structure and international trade. The general message yielded by the analysis is that much of Croatia’s initial advantage was lost over the past two decades because of war, the unfavourable political climate in the 1990s, late integration into regional, European and global economic institutions and the slow restructuring of enterprises.

De)industrialisation and lessons for industrial policy in Central and Eastern Europe

Abstract Over the past two and a half decades, the economic landscape of Central and Eastern European countries (CEECs) has considerably changed. The demise of traditional industries and the rise of the service sector during the 1990s inclined economic structure towards deindustrialisation. In years that followed, new industries emerged in many of these countries and brought them back on the route of reindustrialisation. Across countries, this process developed at an uneven pace. The recent rise of awareness about the importance of industrial development for the well-being of nations makes it relevant to investigate the sources behind changes in the economic structure of CEECs. Our findings reveal that reindustrialisation takes place at an uneven pace. No support was found for horizontal economy-wide industrial policies advocated within new classical economics. Strong impulse to reindustrialisation comes through improvements in export sophistication. Such findings are in line with those on the position of CEECs in global value chains.

ECONOMIC STRUCTURE AND REGIONAL ECONOMIC PERFORMANCE IN ADVANCED EU ECONOMIES

Abstract Recent economic turmoil has revived interest in the quest for sustainable growth. Current economic thinking attaches growing importance to industrial development. The roots of such thinking can be traced back to traditional arguments about the beneficial role of manufacturing for economic growth through horizontal and vertical spillovers to other sectors. These spillovers are of particular importance at the regional level, as such externalities tend to be localized in nature. The objective of this paper is to explore the relationship between economic structure and regional growth in ten Western European EU member states in the post-crisis period. The analysis wishes to answer the question of whether regions with a higher concentration of manufacturing outperform their counterparts with more diverse economic structures. A spatial panel econometric technique is applied in order to distinguish between the intra-regional and inter-regional effects of economic structure, yielding recommendations for policy makers in the field of industrial policy.