An Approach to the Evaluation of Regional Inequalities: a Case Study of Lithuanian Counties

Kostas Žymantas Svetikas, Ignas Dzemyda

Abstract


The indicators for the evaluation of regional development processes are influenced by a great number of interrelated factors. While investigating sustainable or unsustainable growth, the relation between employment and workplaces, the alternation of the quality of life and the status of health, etc. must be taken into consideration. It is quite complicated to find an appropriate evaluation mechanism for the recognition of regional inequalities. As the al¬ternation of the processes of restructuring and development is quite fast, new relationships, which are observed in the period of the contemporary crisis, influence new types of the consequences of economic development as well as the methods for its evaluation. The paper aims to assess the extent of regional inequalities by using an approach to the evaluation of some differences among developing regional areas based on the NUT 3 level. The results of the appli¬cation of the mentioned methodology are demonstrated by evaluating the processes of regional development in Lithuania. The application of the state-of-the-art scientific methods and tools allows to provide empirical evidence regarding the dynamic processes of regional development. The evaluation of statistical data allows to recognize the inequalities; econometric methods are used for the analysis of the changes of^er capita incomes and their basic com¬ponents as well as the level of labour productivity and employment rate. The proposed approach allows to evaluate the levels of inequality, especially by using the statistical data regarding the income growth in the Lithuanian regions, and the rise of labour productivity gap. Econometric models used to analyse the impact of the capital/labour ratio on labour productivity are discussed in the paper. Calculated technical progress parameters show that annual growth of technical progress is, in fact, the highest in leading regions with strong economies of agglomeration and technological develop¬ment and that the Lithuanian regional policy is relatively ineffective in raising technological progress growth.

Keywords


indicators of sustainability; regional economic inequality; evaluation; econometrics; the European Union; statistical data of Lithuanian counties

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"Intellectual Economics" ISSN online 1822-8038 / ISSN print 1822-8011