Zizi Goschin

Remittances as an Economic Development Factor. Empirical Evidence from the CEE Countries

Abstract Empirical studies on remittances revealed their key role for the household consumption of the receiving families, as well as their investment potential with direct influence on economic development in emigrants country of origin. This paper focuses on the second approach by treating remittances as capital flows that have macroeconomic growth potential. Aiming to test this hypothesis, we constructed a two growth models that include remittances as the variable of interest, alongside the traditional production factors. The models have been tested using aggregate data that cover ten countries in Central and Eastern Europe (CEE) over 1995-2011. Panel estimation methods were employed to account for potential cross-section heterogeneity. The main result is the significant positive influence of remittances on both absolute and relative GDP growth in our panel of CEE countries.

The Question of Clusters in Lagging Regions: Do They Really Make the Difference? A Case Study in Romania

We propose an empirical analysis of the clustering phenomenon in the Eastern part of Romania as a relevant example to support the idea that the question of clusters in lagging regions, usually with economic structures dominated by mid-tech and low-tech industries, could become an interesting niche for cluster-devoted research in forthcoming years. The specific features in two lagging Romanian regions have been investigated by means of geographic information systems, followed by an interview-based qualitative inquiry. The findings indicate that, despite its great potential, the clustering process has not yet reached an upper-level stage; it is still in a ‘start-up’ phase with a series of ‘economic agglomerations’ that could be mostly considered of a static-cluster type. Subsequent reflections on support policies suggest that local production systems of industrial-district type are an appropriate organisational form for cluster development in the two analysed regions, with a special emphasis on ‘soft’ measures that are able to strengthen the local networks and to ensure cluster identity.

Regional Inequalities and Sigma Divergence in Romania

Abstract Starting from the need to understand the economic context that fuels increased regional inequality, this paper addresses the question of long-term regional divergence in Romania focusing on the effects of the recent economic crisis. The study uses a standard regional investigation tool, measuring variation in inequalities from the perspective of sigma convergence. It also addresses the impact of economic growth and crises on inequality. The results indicate territorial divergence in Romania on the long-run and narrowing regional inequality in the last few years, in the context of the economic and financial crisis. The main explanation for this new trend is higher resilience to the crisis of less developed counties/regions, due to the specific sectorial structure of their economies.

Implications of European Union Structural Assistance to New Member States on Regional Disparities: The Question of Absorption Capacity

Increasingly, endogenous factors and processes are being emphasized as drivers in regional economic development and growth. This 15 chapter book is unique in that it commences by presenting five disciplinary takes on endogenous development from the perspectives of economics, geography, sociology, planning and organizational management.

Territorial Inequalities and Economic Growth in Romania. A Multi-factor Approach☆

Abstract Territorial inequalities represent a long-running subject in regional economics and many statistical methods aiming to provide relevant data and information on the magnitude and evolution of disparities have been developed over time. It is a topic of interest in Romania as well, given that the development gaps among counties continuously increased since the transition to market economy, despite many strategies explicitly targeting them. In this context, the paper introduces a new synthetic index of territorial inequalities that includes three variables: GDP/capita, labour productivity and life expectancy in order to capture various aspects of economic and social spatial disparities. This methodological approach offers a better and more complex image on territorial development gaps, compared to the analyses using individual indicators. We further assessed the impact of territorial disparities (as measured by this synthetic index) on the economic development in Romania over 1995-2012, by means of an economic growth model. We found a cointegrating relationship between GDP and the synthetic index of territorial inequalities, suggesting that the regional development in Romania is systematically unbalanced and the disparities have had the tendency to widen with economic growth.

Regional Divergence in Romania Based on a New Index of Economic and Social Development

Abstract Assessment of the magnitude and trends in territorial inequalities could (and should) be a useful tool for designing adequate regional development strategies aiming to reduce economic and social disparities. In this context, our paper is exploring the issue of territorial convergence in Romania by combining economic and social perspectives based on a new synthetic index of development at county level. The index captures various economic and social aspects (GDP/capita, labour productivity and life expectancy), offering a synthetic measure of development which is further used for assessing the degree of convergence among Romanian counties over 1995-2012. We computed the annual coefficients of variation among counties and tested for sigma convergence using standard statistical methods such as Augmented Dickey-Fuller and Phillips-Perron tests. The results indicate a significant sigma divergence trend on the long run, despite temporary decrease in inequalities associated with strong economic growth. It seems that territorial development in Romania was persistently unbalanced and the disparities have had a tendency to widen in time.

Research and Development Intensity in Romania. A Regional Perspective

Abstract The potential contribution of research, development and innovation to enhance the economic competitiveness and support economic growth is largely acknowledged nowadays. Our aim is to explore the factors that influence the R&D intensity in Romania from a regional perspective, on the assumption that the ability to attract research funds varies territorially, shaped by a wide range of socio-economic, structural and political characteristics. Applying econometric panel model techniques that allow for an in-depths exploration of the regional fixed-effects and random-effects, we found a positive influence of regional specialization in high- and medium-high technology, and also in knowledge-intensive services, on R&D intensity in Romania.

Regional Determinants of Average Wage in Romania

Abstract The economic crisis has conveyed a new set of challenges for the labour market, one of its most socially negative effects being the decline in real wages. In this context our paper attempts to explain the wage determinants in Romania from a territorial perspective. We examine the spatial correlation between real wage earnings and various regional characteristics in the framework of a panel data model. This technique allows controlling for region-specific differences in the factors of influence included in the wage model. We test the hypothesis that average regional wages are positively related to the economic performance of the regions. The empirical analysis has covered the 1995-2010 period and our empirical estimations confirmed the significant role of the development level, captured by GDP/capita, on regional wage determination in Romania on the long-run.

Romania's Sustainable Development Requirements from the Viewpoint of Regional Economic Bank's Crediting☆

Abstract This paper is trying to highlight some qualitative and quantitative characteristics of the relationship between regional GDP and loans, both in foreign exchange and lei, for Romania. Taking into consideration the vital importance of funding the national economy by crediting, especially under crisis and after crisis circumstances, we analyzed the influence of regional loans in lei and foreign currency on the size of GDP at county level. The main objective is to establish the relationship or the extent to which the magnitude of regional crediting is connected with the level of economic and social development of counties. On the other hand we tried to identify several groups of counties depending on the size of their credit relative to national average. We regressed GDP on loans in foreign exchange and in lei, using up to two years lags. The main result is that, as expected, both loans in foreign exchange and in lei have positive and statistically significant influence on GDP at county level. We also found that all lagged regressors are statistically insignificant and only the contemporaneous variables influence the GDP. This suggests that loans are not an important investment channel in Romania, since they are mainly used for consumption, debts payment and have only short-term multiplier effects on local economies.

Shadow Economy and Economic Growth in Romania. Cons and Pros

Abstract Shadow economy (SE) represents a complex phenomenon, which is having undoubtedly many negative sides and undesirable implications upon economy and society, but might also have some good effects, offering social self-protection and alternative solutions for unemployment, insufficient consumption and investment in the official economy, etc. Since the attempts to analyze SE based on only one indicator may be misleading, we developed a new synthetic index of SE that includes three relevant indicators: SE measured in euro per inhabitant, SE as percentage of GDP and SE of each EU member state as percentage of the total EU-28 shadow economy. We analyse these three indicators, as well as the synthetic index of SE, for Romania, over 1999-2012. The synthetic index of shadow economy is further introduced into an econometric model in order to assess its impact on the Romanias economic growth. We have tested the links between shadow economy and economic growth in Romania and found a cointegrating relationship, suggesting that SE is consistently related to the official economy and they display similar trends on the long-run.