Endogenous Development: The New Challenge for Central European Industry
G. LUX
Centre for Economic and Regional Studies, Pecs 7601, Hungary, P.O. Box 199
Keywords: эндогенное развитие, промышленность, реиндустриализация, прямые иностранные инвестиции, региональная политика, накопление капитала, endogenous development, industry, reindustrialisation, foreign direct investment, regional policy, capital accumulation
Abstract
This paper examines the applicability of the concept of endogenous regional development to Central European post-socialist countries. Endogenous development emerged in response to the pressures of the global economy in Western Europe, and focuses on exploiting locally rooted competitive advantages that can counteract the cost advantages of less developed economies, providing a «high road» of socio-economic development. In Central Europe, industrial restructuring has mainly followed a development path based on foreign direct investment, which has reinvigorated competitiveness, but now faces the need to go beyond low costs, and counteract the unfavourable effects of external capital dependency. The paper identifies two different paths to encourage endogenous development, drawing attention to their institutional background and the expected consequences on territorial development.
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