Empowering regions for the future: mapping innovation and institutional dynamics in regional competitiveness through a decision tree approach
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Dátum
2026
Názov časopisu
ISSN časopisu
Názov zväzku
Vydavateľ
University of Zagreb
ISBN
ISSN
3102-4823
Abstrakt
Regional development in the European Union is increasingly shaped by the ability of regions to generate innovation, adapt to technological change, and build competitive advantages within a multi-level governance system. In this context, both innovation capacity and institutional quality are central to regional competitiveness. While previous studies have emphasized the importance of innovation for regional growth and the role of institutions in development, the mutual relationships between institutional and innovation indicators at the regional level remain insufficiently described and empirically grounded. The availability of detailed regional data in the EU Regional Competitiveness Index (RCI) 2.0 makes it possible to examine these dynamics more systematically. The objective of this study is to enhance the existing literature by analyzing the relationship between institutions and innovation indicators at the regional level within the EU. More specifically, the study compares the performance and mutual relations of these indicators across EU regions, taking into account path dependencies. It addresses three research questions: what is the relationship between institutional quality and innovation in regional competitiveness; how do these factors influence the performance of European regions; and whether similarities can be identified among regions with comparable institutional and innovation settings. The analysis is based on data from the EU Regional Competitiveness Index 2.0 covering 233 NUTS 2 regions in the EU. The dataset includes 15 indicators drawn from four pillars of regional competitiveness: Institutions, Technological Readiness, Business Sophistication, and Innovation. The study applies a comparative analytical framework using two categorical variables: development phase (post-socialist versus Western capitalist regions) and capital city status. The empirical strategy combines hierarchical cluster analysis based on the Pearson correlation matrix and heatmap visualization, Wilcoxon two-sample tests, Kruskal-Wallis tests with stepwise multiple comparison procedures, and CART (Classification and Regression Trees) decision tree modelling. A novel contribution of the study is the use of decision tree models to create maps of European regions by translating terminal nodes into groups of regions with similar characteristics. The results show strong and significant relationships between institutional and innovation-related indicators. In particular, the three institutional indicators of corruption, quality and accountability, and impartiality are highly correlated with each other and also strongly associated with several innovation-related indicators. The strongest association is found between corruption and individuals buying over the internet. Overall, almost all correlations between institutional and innovation-related indicators are significant, suggesting that institutional quality and innovation capacity are closely intertwined in regional competitiveness. The findings confirm that institutions play a decisive role in regional development and that institutional quality and innovation capacity jointly shape regional competitiveness. Regions with high-quality institutions and strong innovation indicators are well positioned for advanced development phases, whereas regions with weaker institutions but active innovation landscapes represent key opportunities for policy intervention. The study therefore suggests that EU smart specialization strategies should be revised so that institutional improvement becomes an integrated part of these strategies in order to foster more balanced and sustainable regional growth across Europe.
Popis
In: Book of abstracts : of FEB Zagreb 17th International Odyssey conference on economics and business / rec. Ana Aleksić Fredotović, Antea Barišić, Radoslav Barišić ... [et al.]. 1. vyd. Záhreb : University of Zagreb, 2026. ISSN 3102-4823. Pp. 12-13.
Kľúčové slová
regionálny rozvoj, regional development, inštitúcie a organizácie, institutions and organizations, inovácie, innovations
Výstup z projektu
NextGenerationEU 09I01-03-V04-00063/2024/VA POSILA
European Union's Horizon Europe 101079219 The Brridge project
Štipendiá pre excelentných PhD. študentov a študentky (R1)
Plán obnovy a odolnosti SR 09I03-03-V02-00011
Citácia
DOI
Práva a licenčné podmienky
CC BY-NC-SA Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International
info:eu-repo/semantics/openAccess
info:eu-repo/semantics/openAccess