ECONOMETRIC ANALYSIS OF THE PROCESS OF REALIZING THE ECONOMIC POTENTIAL OF THE REGION
Keywords:
Econometric analysis, Regional development, Spatial Durbin Model, Economic convergence, Transport infrastructure, Institutional factors, Gross Regional Product, Spatial spillovers, Investment attractiveness, Regional policy.Abstract
This research provides a comprehensive econometric assessment of the mechanisms and determinants involved in the realization of regional economic potential, defined here as the adaptive capacity of a territorial system to transform endowments into sustainable growth. Integrating advanced spatial econometric techniques with institutional analysis, the study employs the Spatial Durbin Model (SDM) to investigate regional interdependencies and spatial spillovers. Empirical evidence is synthesized from two distinct developmental contexts: the convergence of transport infrastructure in 47 Spanish provinces (1980–2008) and the growth determinants of Gross Regional Product (GRP) in the Russian Federation. The findings reveal that while absolute and conditional \beta-convergence are statistically significant, the realization of potential is contingent upon the specific nature of capital; in the Spanish case, only road infrastructure significantly catalyzed convergence, while the Russian context highlights the dominant role of fixed capital and innovation costs (with elasticities of 0.72 and 0.14, respectively). A critical contribution of this study is the identification of the "efficiency-equity trade-off" and the role of institutional quality—specifically the reduction of transaction costs and the socialization of growth—in mediating developmental outcomes. The research concludes that regional policy must shift from a paradigm of endowment equalization to one of productivity-oriented smart specialization to fully unlock latent economic potential.
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