Home  Journals  Regional Economics: Theory and Practice  28(403) - 2015 July

Factors of economic development of cities in the region

Vol. 13, Iss. 28, JULY 2015

Article PDF Version

Received: 4 December 2014

Accepted: 15 January 2015

Available online: 26 August 2015

Subject Heading: SUSTAINABLE DEVELOPMENT OF REGIONS

JEL Classification: 

Pages: 54-68

Importance The article presents the results of the analysis of conditions and factors of urban development of the region.
     Objectives The goal of the study is to score the dependence of gross municipal product of cities on variables such as the municipal budget cost on education and health, the number of persons engaged in small business, investment in fixed assets. As well, the paper provides interpretation of grades and recommendations on policy.
     Methods For research, we used statistical and econometric methods. The database is generated from a sample of the cities of the Chelyabinsk region. To select an adequate model of analysis, we applied specific tests of the structural characteristics of the models.
     Results We identified a significant positive relationship between per capita gross municipal product and variables of budget expenditures on education and health care and investments in fixed assets, as well as differences in the values of coefficients for the variables to most major cities in comparison to other cities.
     Conclusions and Relevance We draw a conclusion that the cities of the region not included in the group of the largest ones, are strongly influenced by the perspective of social spending. We proved that for the long-term growth, a strategy of transition to a different growth model, in which the major role is played by investment, predominantly private, is absolutely necessary. In addition, we prove that small business plays an insufficiently expressed role in the economic development of the region, and the actual employment in it is poorly considered.

Keywords: measurement, sub-regional, economic growth, urban analysis, models, panel data, econometric models

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