Assessing the potential for knowledge-based development in transition countries. Bruegel Working Paper 2010/01, May 2010

This Working Paper by Bruegel Senior Fellow Reinhilde Veugelers examines the potential for a knowledge-based growth path in transition countries of central and eastern Europe, the Caucasus and Central Asia. The paper looks closely at how total-factor productivity, a residual growth factor commonly interpreted as reflecting technological progress, drives growth rates in these economies which exhibit a much lower GDP per capita compared to the EU15 or the United States. By analysing the prerequisites for knowledge-based growth, the author explains why transition countries are at a systemic disadvantage relative to the EU15, US and Japan and have limited potential for knowledge-based growth

Assessing the potential for knowledge-based development in transition countries

This Working Paper by Bruegel Senior Fellow Reinhilde Veugelers examines the potential for a knowledge-based growth path in transition countries of central and eastern Europe, the Caucasus and Central Asia. The paper looks closely at how total-factor productivity, a residual growth factor commonly interpreted as reflecting technological progress, drives growth rates in these economies which exhibit a much lower GDP per capita compared to the EU15 or the United States.  By analysing the prerequisites for knowledge-based growth, the author explains why transition countries are at a systemic disadvantage relative to the EU15, US and Japan and have limited potential for knowledge-based growth.

IKT i inovacije za konkurentnost: Zapadni Balkan vis-à-vis Europske Unije

The aim of this paper is to evaluate how well-prepared the Western Balkans (Albania, Macedonia, Montenegro and Serbia) are to join the EU in terms of competitiveness and to clearly identify the set of EU countries that would represent a ‘real benchmark’ when trying to assess the region’s competitiveness. In 2010, the Europe 2020 strategy was proposed as a means of focusing the EU and its Member States on the main task of improving competitiveness and creating conditions for smart, sustainable and inclusive growth. As candidate countries for EU membership, Western Balkans are expected to act in accordance with these goals. Hence, this paper implements the Global Competitiveness Index 2015-2016 and a set of supplemental data analysis tools to assess both the level of competitiveness and the region’s relative position vis-à-vis the EU member states. The results clearly show that the EU is far from a homogenous entity in terms of competitiveness, whilst the candidates expose a competitiveness profile similar to that of Central and Eastern Europe. Overall, the Western Balkans trail behind the EU-28 countries in building a knowledge-intensive economy and are significantly outdistanced in laying the foundations for ‘smart growth’, as the European economies press ahead.Cilj rada je ocijeniti koliko su zemlje Zapadnog Balkana (Albanija, Makedonija, Crna Gora i Srbija) dobro pripremljene za članstvo u EU u smislu konkurentnosti, te jasno identificirati skup zemalja EU-a koji bi predstavljao realni usporedni prag vrijednosti konkurentnosti regije. U 2010. godini, Strategija Europa 2020 predložena je kao sredstvo fokusiranja EU-a i njezinih država-članica na glavni zadatak poboljšanja konkurentnosti i stvaranja uvijeta za pametan, održiv i inkluzivan rast. Očekuje se da države Zapadnog Balkana kao kandidati za članstvo u EU djeluju u skladu s ovim ciljevima. Dakle, u radu se koristi Indeks globalne konkurentnosti (GCI) 2015-2016 i skup dodatnih alata za analizu podataka s ciljem procjenjivanja razine konkurentnosti, te relativne pozicije regije naspram zemаljа-članica EU-a. Rezultati jasno pokazuju da EU nije homogeni entitet u pogledu konkurentnosti, dok kandidati imaju profil konkurentnosti sličan zemljama Centralne i Istočne Europe. Općenito govoreći, zemlje Zapadnog Balkana zaostaju iza zemalja EU-28 u izgradnji gospodarstava zasnovanih na znanju, i značajno su distancirani u postavljanju temelja tzv. ‘pametnog rasta’, koncepta kojeg Europske ekonomije snažno zastupaj

Bosnia and Herzegovina - Meeting Copenhagen economic criteria for accession to the EU

Delegation of the European Commission based in Sarajevo, Bosnia and Herzegovina (BH) granted the consortium represented by ECORYS a contract for EU support to the Economic Policy Research Unit, a subdivision of the Economic Policy Planning Unit of the Council of Ministers of Bosnia and Herzegovina. As part of this project activities a subproject was designed trying to assess the position of BH against the benchmarks of the Copenhagen economic criteria and to identify policy measures for meeting the criteria. The issues of particular relevance to the project included: presentation of the Copenhagen economic criteria, analysis of the existing situation in the country, strategic and policy documents addressing the subject, identification of gaps to be filled in order to achieve the benchmark, and policy recommendations. In July, 2006 ECORYS appointed the Center for Social and Economic Research (CASE), an international, non-profit research and advisory institution, to research on the subject. The research project team comprised experts: Messrs. Rafa³ Antczak (team leader), Wojciech Paczyñski, and Ranko Markuš, Mmes. Ma³gorzata Antczak and Karina Kostrzewa, assisted by Mr. Erol Mujanovic. The report was based on available national account and microeconomic data, strategic and policy documents of the BH governmental bodies, relevant reports by international organisations, EU institutions, academic and research centres and opinions of key stakeholders. The analytical research on the economic developments in BH by international financial institutions, especially the IMF and World Bank, as well as domestic bodies, especially the Economic Policy Research Unit, was extensively exploited in the research. However, the primary focus of the research was on structural and institutional aspects facilitating or impeding functioning of a market economy in the BH and country's capacity to cope with competitive pressure and market forces within the EU. Therefore, the report focuses on background analysis of economic factors influencing the functioning of market economy and the capacity to withstand the competition in the EU market. The research consists of four main parts. In Part 1, the Copenhagen economic criteria are presented in a comparative perspective of the recent experiences of the new member states and acceding countries to allow diagnosing of the most important gaps to be filled by BH. Part 2 analyses macroeconomic developments in BH, presenting them in a comparative perspective relative to EU candidate countries. The special focus is on two fields where BH faces particularly difficult challenges: labour market and foreign trade. Also, the three scenarios of BH catching-up with the EU are presented. Privatisation process which is one of the most important institutional and structural features of every transition economy and especially relevant from the perspective of meeting the Copenhagen criteria is analysed in Part 3. Part 4 comprises analysis of microeconomic developments in BH with the elements of the financial analysis of enterprises, both state and private. The financial analysis of enterprises concentrates on current situation and identification of trends in microeconomic developments to identify comparative advantages, assess productivity, and to position the BH enterprise sector towards the potential competition on the EU markets. Finally, Part 5 includes policy recommendations for decision makers both from the BH government and the EC. The research is supplemented by the Annexes providing background pieces of information on the analysed topics. The project team established contacts with representatives of international organizations, the BH governmental bodies, and research community in BH to collect pieces of information and consult on research topics. However, the authors of the researchers bear the sole responsibility for the pieces of information and opinions presented in the report.Bosnia and Herzegovina, Copenhagen criteria, EU accession, European integration, competitiveness

Evaluation of the Macedonian transformation in the international reports in the 2000s

The author of the article presents the image of the Macedonian transformation dynamics according to the analysis of selected reports published annually by influential international research institutes, organizations and opinion‑forming media, which evaluate the political, economic and social situation in various countries of the world in the 2000s. The paper introduces the preliminary results of a research project involving critical analysis of reports on the situation in Macedonia and particular public policies of the Republic, which are included in publicly available and are cited - by politicians, the media, public opinion - international reports, which use the indicators commonly applied in the world. The main areas of analysis are: the degree of the competitiveness, economic freedom and rule of law on the market and the state; the level of the democracy, political rights and civil liberties; the degree of the equality and welfare of the society and - finally - the status in the security area, i.e. the main indicators of the peace and stabilization of the Republic of Macedonia

Towards A knowledge-Based Economy - Europe and Central Asia - Internet Development and Governance

The diversity and socio-economic differentiation of the real world prevents the full-scale cultivation of Information and Communication Technologies (ICT) to the benefit of all. Furthermore, the lack of determination and political will in some countries and slowness of responses to new technological opportunities in some others are responsible for the creation of another social divide – a digital one. The above problems were fully acknowledged by the World Summit on the Information Society (WSIS). The Summit called for a joint international effort to overcome the digital divide between and within the United Nations Member States under the Digital Solidarity umbrella. This report was prepared as a follow-up to the Summit and represents a brief review of the status and trends in the area of ICT and Internet development in the UNECE region and provides background information on the state of the art in some relevant ICT subsectors in the Member States. The report focuses on the state of the Internet critical resources and, consequently, on the ICT and Internet penetration across countries and social groups. It also looks into existing Internet governance arrangements and makes some recommendations. The report contains three parts and conclusions. The first part, “Towards a Knowledge-based Economy: Progress Assessment”, highlights the situation in the region with regards to the digital divide, both between and within countries, and national strategies and actions aiming at overcoming barriers to accessing the Internet. The second part, “Internet Development: Current State of Critical Internet Resources in the UNECE Region”, concentrates on reviewing the physical Internet backbone, interconnection and connectivity within the Internet in the UNECE Member States. The third part, “Governing the Evolving Internet in the UNECE Region”, focuses on the issues of Internet Governance in the countries of the region, challenges faced by the countries and participation of key stakeholders in ICT and Internet policy formulation and implementation. The final part contains conclusions and recommendations.Internet, governance, knowledge-based economy, Europe, Central Asia, transition economies

Measuring the Potential for Technology Entrepreneurship Development: Serbian Case

Research Question: This paper explores the potential for technology entrepreneurship development at the country level through the creation of a new composite index. Motivation: Motivation for this paper arises from the fact there is a lack of the composite indices used exclusively for technology management as identified by Jovanovic et al. (2017). Technology indices are mostly used as important components of other composite indices used for tracking a country performance from the perspective of other global phenomena (e.g. competitiveness and innovativeness). The novelty of this paper reflects in the proposed Technology Entrepreneurship Development Potential (TED-pot) index which has multiple significances. It could serve as a help for policy makers in creating national policies; other companies and countries looking for the adequate environment to invest in technology entrepreneurship projects; academics who benefit from a new country-level view on technology entrepreneurship, especially ICT entrepreneurship. Idea: The idea of the paper was to create the TED-pot index to enable the cross-countries comparisons and examine whether the potential of Serbia lies in its entrepreneurial ICT sector. Data: Four indicators included in the created index are measured by the World Bank. The index is applied on six ex-Yugoslav countries and the EU for the period 2009-2014. All the data is collected from the World Bank database. Tools: The final index value is obtained by using the simple weighted function with equal weights. The overall TED-pot has been built upon the equal weighting of the two created pillars: ICT potential (ICT-pot) and Entrepreneurial potential (E-pot). The values for each pillar are calculated by the same procedure, through the simple mean of certain indicators. Findings: According to the calculated TED-pot values, Serbia stands out as a country with the greatest potential for technology entrepreneurship development in the region. Analysing individual pillars, ICT-pot indicates Serbia has very strong ICT sector, far ahead of other countries in the region, while the E-pot values show there is a space for administration to ease and speed up the process of starting new businesses in Serbia. This is a pilot research and the first presentation of the created index, which calls for further investigation. Contribution: This paper expands exiting research related to the country-level measurement in the field of technology management and entrepreneurship, especially focusing on ICT entrepreneurship development

RAZVOJ MALIH I SREDNJIH PODUZEĆA I PODUZETNIŠTVA U REPUBLICI SRBIJI I REPUBLICI HRVATSKOJ

Micro, small and medium-sized enterprises (SMEs) are an important generator of new jobs and additional value of every national economy. The European Union constantly points to the key role that SMEs play in ensuring competitiveness in the market, and uses various policies to create a more favorable business environment, as set out by the Lisbon strategy. Creating adequate conditions to encourage innovation and other factors that may improve the business of SMEs is very important in a dynamic market, but also because of increasingly sophisticated demands coming from clients. Various world studies show the following problems: inadequate level of activity in launching new business ventures, a small percentage of newly established enterprises, administrative barriers to the implementation of entrepreneurial activities, underdevelopment of financial markets and lack of entrepreneurship education which provides knowledge and skills in business. The aim of this paper is to review the current situation of small and medium-sized enterprises in the Republic of Serbia and in the Republic of Croatia through several aspects: dynamism, innovation, importance of the sector for the economy and regional development, access to finance, access to educational programs and professional services, as well as the possibilities of financing development through the European structural and investment (ESI) funds.Mikro, mala i srednja poduzeća (MSP) važan su generator stvaranja novih radnih mjesta i kreiranja dodatne vrijednosti svake nacionalne privrede. Europska unija kontinuirano ukazuje na ključnu ulogu koju mala i srednja poduzeća imaju u osiguravanju konkurentnosti na tržištu te različitim politikama usmjerenim na ovaj sektor kreira za njih povoljnije poslovno okruženje, kako se i navodi u Lisabonskoj strategiji. Kreiranje adekvatnih uvjeta za poticanje inovativnosti i drugih činitelja koje mogu utjecati na bolje poslovanje MSP-a vrlo je važno na dinamičnom tržištu, ali i zbog sve sofisticiranijih zahtjeva klijenata. Razna svjetska istraživanja u svojim izvještajima kao prepreku prikazuju nedovoljan nivo aktivnosti u pokretanju novih poslovnih pothvata, mali postotak novootvorenih poduzeća, administrativne prepreke za provođenje poduzetničkih aktivnosti, nedovoljnu razvijenost financijskog tržišta te nedostatak edukacije usmjerene na razvoj poduzetničkih znanja i vještina. Cilj je ovoga rada prikazati pregled trenutnog stanja sektora malih i srednjih poduzeća u Republici Srbiji, kao i u Republici Hrvatskoj preko nekoliko aspekata: dinamičnost, inovativnost, značaj sektora za privredu i regionalni razvoj, pristup izvorima financiranja, dostupnost obrazovnih programa i profesionalnih usluga, kao i mogućnosti financiranja razvoja Europskim strukturnim i investicijskim (ESI) fondovima

Образовање као пут за припрему Србије за дигитално повезани свет

The digitalization level of society and economy is growing in accordance with the rising acceptance and implementation of digital technologies and the transfer of social and economic activities to the Internet. Serbia, being at the beginning of the information society and digital economy development, has to define a proper infrastructure-organization-human framework in order to tap all the advantages offered by new technologies for more competitive business operations of domestic enterprises and long-term sustainable development of the national economy. This paper analyses the role of education in the process of the digital transformation of the Serbian economy and society. It particularly points out to the importance of ICT education and digital innovations that create solutions and knowledge for economic development and progress in the modern digitally connected world.Појава информационо-комуникационих технологија (ИКТ) као кључних технологија опште намене које подржавају различите пословне активности утицала је у последњих 40 година на скоро све области рада и деловања. Савремени свет данас реализује бројне позитивне утицаје ових технологија на економију, раст пословања и унапређење животног стандарда. Управо зато и развијене земље и оне у развоју настоје да на прави начин примене ИКТ како би искористиле све иновативне потенцијале и динамику раста које ове технологије доносе привреди у укупном друштву. За Србију као земљу у транзицији суочену са економском и финансијском нестабилношћу и буџетским ограничењима прави је изазов савладати све неизвесности и баријере које стоје на путу примене ИКТ тако да оне постану основни покретач економских активности. У последње две деценије Србија је значајно унапредила приступ ИКТ-у, остварила развој ИКТ тржишта и самог ИКТ сектора, али остају неопходне даље реформе у домаћој економији које би омогућиле да дигиталне технологије постану кључни носилац економског и друштвеног раста и развоја. Српска предузећа више или мање заостају у потпуној примени ИКТ у свом раду и пословању, тако да спор ниво дигиталне трансформације прави одраз налази у ниском нивоу конкурентности домаћих предузећа. У Србији се и даље остварује релативно низак ниво е-пословних трансакција, недовољно је развијен менаџерски и правни оквир примене дигиталних технологија у пословању, а заостатак се евидентира и у нивоу остварених иновација производа, услуга и пословних процеса. Ови фактори ограничавају капацитет националне економије да на прави начин искористи предности дигиталних технологија у смислу динамизирања економије и остваривања конкурентније позиције на глобалном тржишту. Управо зато, један од приоритетних задатака српске владе је убрзање процеса дигитализације домаће привреде с обзиром на то да се ту препознаје значајан потенцијал бржег развоја, и с обзиром на чињеницу да развој информационог друштва и дигиталне економије представља и један од приступних услова Србије за пуноправно чланство у Европској унији. Србија мора даље развијати и тзв. чврсту (хард- широкопојасне конекције, хардеврски потенцијали) и меку инфраструктуру (софт- едукација, знање, иновације) како би била способна да се суочи са изазовима нове Четврте ин- дустријске револуције и да одговори на нови талас дигиталних технологија везаних за мобилне комуникације, друштвене медије, облак рачунарство, биг дата аналитику, паметне уређаје, Интернет ствари. Добро развијена телекомуникациона инфраструктура великих брзина и високе пропусне моћи која би била расположива у свим секторима до- маће привреде може бити искоришћена само од стране образоване радне снаге која ће поседовати одговарајућа техничка знања и бити ИКТ писмена. Знање представља кључни део тзв. меке инфраструкуре која је неопходна за реализацију трансформације привреде у дигиталну привреду, а укупног друштва у информационо друштво. У Србији су неопходне активности на укупном подизању свести о савременој дигиталној реалности која захтева базну ИКТ едукацију за све грађане и укључивање ИКТ образовних садржаја у све области обука и учења. Поред образовања, иновациона способност привреде мора бити подигнута на виши ниво како би се проширили потенцијали домаћих предузећа да на прави начин усвоје и реализују нове дигиталне технологије. Поред државе значајно се више мора укључити и пословни сектор у ИКТ образовање и иновације. Значајан одлив младе образоване радне снаге, посебно инжењерских специјалности, представља посебан проблем коме домаћа влада мора дати приоритетни третман и развити одговарајуће програме за мотивисање и задржавање младе образоване радне снаге да остане у земљи и својим знањем допринесе развоју домаће привреде. Нови реформисани образовни систем који ће ИКТ вештине препознати и позиционирати на прави начин и динамичан иновациони систем су кључни предуслови за припрему Србије за нови дигитално повезани свет.8. Конференција академија подунавске региј