Discussion Papers 2007.
Regionality and/or Locality 81-88. p.
REFLECTIONS ON APPROACHES TO (REGIONAL)
ECONOMIC DEVELOPMENT OF SLOVAKIA1
VLADIMÍR SZÉKELY
Introduction
Slovakia is characterised not only by differences between urban and rural areas but
also by spatial dichotomy between the west and east, as well as the centre and pe-
riphery of the country. These differences sometimes exceed the acceptable limits
and call for an efficient regional policy based on a widely elaborated theoretical
knowledge of causes, manifestations and possible ways to reduce the unwanted
level of spatial differentiation. In principle, there are two kinds of theoretical con-
ceptions of regional development: those based on the conviction that regional dis-
parities diminish under the effect of development (convergent conceptions based
on the theory of regional balance) and those that lean on the assumption that re-
gional disparities increase under the effect of development – divergent conception
or the theory of regional imbalance.
Approaches to the (regional) economic development of Slovakia in this study
are reviewed from the point of view of the National Strategic Reference Frame-
work 2007–2013 (hereafter NSRF, website of the Ministry of Construction and
Regional Development of the SR www.build.gov.sk). However, only some key
points of this material are analysed and scrutinized in the light of theoretical con-
ceptions concerning the regional development.
It is necessary to bear in mind that a kind of eclectic period in regional policy
where several theoretical conceptions meet, is talked about. Eclectic period is the
product of a distinct opinion plurality concerning the issue of regional develop-
ment. This plurality of opinion though has one common denominator: that concep-
tions as a rule agree in emphasizing the importance of human initiative and human
resources for the regional development and its stimulation. Support to the opening
of small and medium firms, support to dissemination of technical innovations, de-
centralizing measures in public administration, support to local initiatives, deregu-
lating measures, networking of actors at the regional manufacturing or consumer
markets, programmes caring after foreign investors (Blažek–Uhlíř, 2002) are the
currently preferred. The NSFR is also evaluated in an electing way.
1This paper was prepared under the Project No. č. 2/6038/26 “Economic performance and
competitiveness of localities and regions” financially supported by the VEGA Grant Agency.
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
Discussion Papers, Special
82
VLADIMÍR SZÉKELY
Economic performance and competitiveness of localities
and regions
One of the strategic aims of the economic and social development of the SR until
2013 is a distinct increase of competitiveness and performance of regions and con-
sequently the Slovak economy with the due respect to sustainability. Let me reflect
upon the term regional competitiveness that (just like the term sustainable devel-
opment) is according to theoreticians of regional development one of the least defi-
nite ones (see for instance Kitson et al 2004). Likewise, representation of the re-
gional economic performance by the GDP per inhabitant is also generally consid-
ered outdated and it is normally replaced by other appropriate measures. On the
other side, in an effort to capture and express the socio-economic situation in a
more comprehensive manner, other synthesising indicators, which contain along
with the indispensable economic dimension also a social dimension and/or envi-
ronmental dimension (for instance, the human development index) are searched.
With regard to regional development of Slovakia and identification of regional
disparities in economic performance one thing has to be mentioned. The question
how to delimit suitable regional units that would represent functional relationships
in space is a problematic one not only in Slovakia but also in many other European
states. Analyses focused on identification of regional disparities in Slovakia are as
rule linked to the region, which is the product of the territorial/administrative divi-
sion. Bezák (2001) believes that the territorial/administrative units cannot take over
the function of spatial or regional units because instead of scientific criteria ac-
cording to which the territorial/administrative division is made, other unscientific
(mainly political) reasons are respected. Based on his analysis, he reports that “as
far as the number of administrative regions, selection of their centres and outlining
of regional boundaries are concerned, there are serious disproportions between
the present regional structure and the new territorial/administrative division of
Slovakia”. Although one can agree with this assertion, the practical life has shown,
that the regional statistics bound to administrative units quite distinctly determine
the regional analysis. Study of literature and official governmental documents lead
to the conclusion that in spite of its rationale the problem pointed at by Bezák is
being overlooked at all levels. It also is the reason why the position of administra-
tive region Bratislava is erroneously emphasized. This position is the result of in-
correct collection of statistical data and of its spatial delimitation and consequently
incompatibility with other spatial units of the NUTS III level. Unfortunately, the
issue of forming functional regions to which also the regional statistics would be
naturally bound remains unsolved.
Economic performance can be explored from many aspects while the use of se-
lected indicators leads to different results. Categories like wages, growth of wages,
GDP or its growth, number of employees, growth of employment, number of un-
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
Discussion Papers, Special
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employed, unemployment rate or its development, etc. are used as indicators which
in synthesised form represent the interaction of the determinants of local and re-
gional competitiveness. Each of selected indicators is more or less spatially differ-
entiated. The fundamental question for the basic research and the decision-making
sphere at varied hierarchic levels is why the localities (above all those of urban
type) and regions differ in their economic performance. Why one region or locality,
now seen as a significant source of external effects, is more successful than the
other.
The basic elements of the regional competitive advantage are: production capi-
tal (high-performing production of regional economy), human capital (quality and
qualifications of labour forces), socio-institutional capital (the extent, depth and
orientation of social networks and institutional forms), cultural capital (range and
quality of cultural opportunities and assets), infrastructural capital (scale and qual-
ity of public infrastructure) and the capital inherent to society’s knowledge and
creativity in interaction with the aim to increase the regional productivity and liv-
ing standard (Kitson et al. 2004).
Economic performance is connected with productivity, which as many authors
believe, decisively controls the living standard of population in towns and regions.
Materials forming the contemporary regional policy in Great Britain report that as
much as about 60% of differences existing in regional GDP values per inhabitant
are due to differences in productivity. Five “drivers” of productivity were identi-
fied: skills, investment, innovation, enterprise and competition. Authors of materi-
als among which representatives of economic sciences dominate, believe that the
improvement of regional economic performance requires work with these five
“drivers”. This approach is absolutely new in the regional policy of Great Britain
and the geographic community has subjected it to certain revision (Fothergill,
2005). Total ignoring of physical environment, which undoubtedly influences lo-
cation of production activities and concentration of population, has been subject of
most criticisms. (The NSFR does not mention the factor of physical-geographical
differentiation of Slovakia in connection with the economic performance and com-
petitiveness in regions in spite its evident impact relevance).
A distinctly increased interest in study of regions (subregions or localities) and
their competitive advantages is now observed due to formation of higher territorial
units and establishment of regional (local) self-governments in Slovakia. Improved
competitiveness of less developed regions in official materials of the European
Commission seems to be the indispensable condition of social cohesion. Various
ratings of spatial units based on selected indicators of economic performance are
prepared. Spatial units are compared and subsequently their order is compiled. The
order serves to identification of absolute and relative positions of spatial units in
the framework of a higher hierarchic system. Each spatial unit in an effort to attract
people and capital amidst strong competitive environment is striving to be included
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
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VLADIMÍR SZÉKELY
among “winners”. But the number of “losers” is always higher as number of “win-
ners”. Attractive investments, which ensure new jobs, economic growth, prosper-
ity and increased living standard of local and regional populations, are only going
to a small number of localities attractive for potential migrants. It is a paradox that
no univocal opinion concerning interpretation and measurement of the concept
“regional competitiveness” exists at the theoretical level and in studies involved
with the basic research. It is generally considered as a complex and questionable
term.
Science parks as tools for improvement of regional
competitiveness (?)
The aim „to increase considerably the competitiveness and performance of Slovak
economy by the year 2013 while paying respect to sustainable development“ will
be pursued by means of three strategic priorities: 1) Infrastructure and regional
accessibility, 2) Innovation, informatization and knowledge society, 3) Human
resources and education. The strategic priority “innovation, informatization and
knowledge economy” includes at least two specific priorities and three operational
priorities (2.1 Support to competitiveness of firms and services by innovations,
2.1.1 Innovation and technology transfers, 2.1.2 Support to common services for
entrepreneurs, and 2.3 Research and development, 2.3.3 Support of cooperation
between R&D institutions and business sphere and knowledge or technology trans-
fer into practice) where support to science parks as tool for reaching the objectives
of economic and social development of the SR is both explicitly or implicitly men-
tioned.
The concept of science parks (SP) appeared for the first time by the end of the
1950s in the USA. The principal argument for their establishing was to fulfill
aspirations of economically thinking academic workers who were aware of the
commercial potential both of developed technologies and research results. The
proximity of universities as the natural sources of inventve thinking and
concentration of highly quialified labour was one of the decisive location factors in
estabilishment of the SPs (Vedovello, 1997).
Terminological heterogeneity in denoting the investigated phenomenon on the
one side and the idea what SP represents (see for instance Lazzeroni 1995, or Sto-
rey, Tether 1998) on the other in individual studies is evident at the first glance.
Shearmur a Doloreux (2000) point to the problem of defining the SP saying that
definition of SP is rather unclear as in its description various terms are used: re-
search and technological parks, technopoles (term used in Francophone area) and
technopolis (term used for instance in Japan). As no universal definition of SP ex-
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
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ists, the use of different terms for spatial concentration of producers of high-tech-
nology products and services in parks and provision of opportunities for institu-
tional cooperation between universities and industry is only natural.
From the 1950s until now, the meaning and tasks of SP has been changing.
While at the beginning until about the 1980s, the priority of SPs was revaluating of
scientific research and support to transfer of research achievements to industries,
the SPs of today are tools (or they should be) of local and regional economic de-
velopment supporting innovation and the subsequent increase in competitiveness of
companies and regions.
As Massey et al. 1992 assert (see Shearmur–Doloreux, 2000), objectives of SPs
can be classified into three main groups: as) objectives associated with economic
development b) objectives associated with transfer of technologies, and c)
objectives associated with local (or regional) benefits (Table 1).
It is generally known, that SPs provide or should provide numerous advantages
and supporting services tailored for smooth functioning of above all small inde-
pendent technology-based firms. Their presence in SP is desirable so that the park
administrators strive for offering them attractive conditions.
However, it seems that in some cases the scope and quality of services provided
are not necessarily decisive for the location or relocation decisions of firms. Re-
sults of empirical research prove it. For instance, Westhead and Batstone (1998)
studied the perception of positives in independent technology-based firms that were
supposed to emerge as results of their location in SP. The conclusion was that the
decision to locate the firm in a SP was determined above all by the generally
adopted image of high prestige ascribed to such location as a result of shrewd and
purposeful promotion of parks in entrepreneur circles. Shearmur and Doloreux
(2000) even report that numerous new and small technology-based firms that
lacked complete information for an economically rational location decision and
wanted to seat in a SP were even prepared to pay a surplus to the rent, in order to
improve their technological and commercial reputation.
The reason is that this “improvement” was perceived as automatic with mere lo-
cation of the firm in such park. Both authors are convinced (like Lazzeroni 1995)
that the “local SP” often becomes a showcase for the regional economic develop-
ment while promotion and financial support to the park by the local institutions is
again the reflection of an effort to create a favourable image of the particular com-
mune in the eyes of a potential investors. Location of the firm in such “local SP” is
definitely the question of prestige. It is the reason why Shearmur a Doloreux be-
lieve that SPs can easily become glorified parks, which attract firms simply be-
cause they are sites of prestige properties.
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
Discussion Papers, Special
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VLADIMÍR SZÉKELY
Table 1
Objectives of SPs
Economic development
− Stimulate the formation of start-up new-technology-based firms (NTBFs)
− Encourage the growth of existing NTBFs
− Commercialise academic research
− Foster the technologies of the future
− Counter the regional imbalance of R&D capability, investment, innovation
− Attract inward investment, mobile R&D
Transfer of technology
− Encourage spin-off started by academics
− Encourage and facilitate links between higher education institutes and industry
− Facilitate technology transfer from academic institution to firms on park
− Increase the “relevance” to industry of the research and higher education institutes
− Give academic institutions access to leading-edge commercial R&D
− Increase the appreciation of industry’s needs by academics
− Stimulate science-based technological innovation
Local benefits
− Create employment and consultancy opportunities for academic staff and students
− Create synergy between firms
− Create new jobs for the region
− Improve the performance of the local economy
− Stimulate a shift in perceptions
− Build confidence
− Engender an entrepreneurial culture
− Generate income for academic institutions
− Improve the image of academic institutions in the eyes of central government
Source: Shearmur, Doloreux, 2000, p. 1067 (adapted from Massey et al. 1992).
Those who doubt about the real impact of SP on generation of synergy effects be-
tween the scientific institutions and industrial firms and on their effect on local
(regional) development lean on several empirical studies. For instance, Bakouros et
al. (2002) analysed operation of three SPs in economically less developed Greece
through relationships between universities and industry. Authors wanted to find out
whether the widely used term “high-tech fantasies” is also adequate for the Greek
SPs. (the term “high-tech fantasies” is associated with the study of British geogra-
phers led by D. Massey who pointed to the limited possibilities of SPs in support
the technology transfer and creation of important synergy effect among firms lo-
cated in parks and also between firms and academic centres (universities)). The
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
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questionnaire survey revealed that the relationships between firms and local uni-
versities are above all informal (personal contacts, access to specialized literature,
to equipment, to results reached in research, attendance to seminars, conferences
and training programs). More developed formal relations (common research or
contracts, agreements about consultations, analysis and testing in academic centres)
have been successfully established only in one park while in other two parks for-
mal relations have been only introduced. It is interesting that the synergy among
companies in individual parks is in form of commercial transaction or social links
while research discovered the total absence of scientific/research links in the three
parks confirming the assumptions of British geographers.
Absence of links does not have to be necessarily a general one. For instance,
the research of companies located in the Western Australian Technology Park car-
ried out by Phillimore (1999) confirms it. It is remarkable that in spite of quoting
the studies pointing to unused opportunities of cooperation, he obtained (while he
also pinpointed qualitative and quantitative reserves in networking companies and
scientific institutions) quite different results from those of Bakouros et al. (2002).
What kind of SP should be established in Slovakia? The survey of literature
concerned with different specific forms and operations of SPs shows that no uni-
versal model of park capable to fulfil the established objectives exists just like
there are no universal predictions of its impact on formation and improvement of
regional (local) structure and labour market or on establishment and increase of
competitiveness and prosperity of industrial companies. It seems that the specific
success depends on the concrete environment, rate of engagement of people con-
cerned with high business sensibility and the particular time. It is supposed that
taking into account the specific features of Slovakia, the most rational environment
for the establishment of a SP is the agglomeration of Bratislava with its scien-
tific/research base appropriate for copying the British and American models where
the principal initiative is that of universities cooperating with the business sphere
and local and regional self-governments.
Conclusion
The detailed analysis of NSRF inevitably leads to the conviction that the ambition
of the SR is to realize the “high road” developmental strategy in close future, aim
of which is the competitiveness based on high rate of innovation, cooperation, de-
veloped networks and the supporting institutions. It is the strategy typical for the
highly developed states; the SR does not belong to as yet. On the other side, there
also exists the “low road” developmental strategy leaning on comparative advan-
tages in form of competitive prices, low wages and standard employment. This
strategy is typical for less and moderately developed states. The past economic and
Vladimír Székely : Reflections on Approaches to (Regional) Economic Development of Slovakia.
In: Regionality and/or Locality. Pécs: Centre for Regional Studies, 2007. 81-88. p.
Discussion Papers, Special
88
VLADIMÍR SZÉKELY
social development of the SR suggests that precisely this type of strategy may
dominate in Slovakia in the nearest future in spite of declared ambitions to change
from the “low-road“ to “high-road”. Such a change is, after Paulov (1999), a
highly demanding matter requiring long-term concentrated and consistent efforts.
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