Correlation analysis of indicators of regional competitiveness: The case of the Republic of Serbia

Abstract

The identification and analysis of the indicators of regional competitiveness is the most important phase of the process of measuring competitiveness. However, prior to the measurements, it is necessary to determine whether there is a high correlation between the selected indicators or not. The aim of this paper is to determine whether there is a high correlation between the most important indicators of regional competitiveness or not. The subject of this paper are the indicators of competitiveness in Serbia's regions, whose values are measured in the 2011-2013 period. For the indicators unrelated to each other or those having no logical mutual influence, no correlation was revealed. On the basis of these results, it turns out that there is a high correlation between the GDP of the region, the number of companies in the region, the number of employees, the extent of the cluster, investments in innovation and confidence in business institutions. The Pearson correlation coefficient statistical method has been used in the estimation. These data, whose measure cannot be achieved through quantitative measurement, have been obtained in the survey.Keywords: regional competitiveness, indicators of regional competitiveness, correlation analysis of the indicators of regional competitiveness JEL Classification: R10, R58, O18The term of competitiveness is widespread in the economic literature. Many economists have been explaining this term for decades, one can even say for centuries, with the key questions: How to understand this issue and what is the best possible way to do so? Which one is most important for the growth of economic wealth and the most effective for its distribution? Different authors define it differently at the level of companies, the industry, the region or the city; because of the complexity of the term, however, there is no generally accepted definition. The wider term of competitiveness refers to the propensity and skill of competition, the ability to win and retain a market position, and increase the market share and profitability. Hence, the term of competitiveness means the success of a business. Due to the complexity of the concept, a variety of factors and the nature of the competitive process, the term of competitiveness is difficult to explain and often confusing, especially at the regional level (Snieška & Bruneckienė, 2009).The level which competitiveness is defined at is the most important aspect of this concept (Annoni & Kozovski 2010;Kitson et al, 2004). The indicators of regional competitiveness provide important information about the ″strength″ of the region to achieve an adequate economic performance, provide appropriate social care and quality infrastructure, generate innovation, develop human capital, possess geographical and natural potentials, have adequate institutions and promote culture and develop tourism. Competitiveness can be possible to measure by identifying, selecting and analyzing these indicators.The subject of this paper are the indicators of competitiveness observed i...

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