Evaluation of Local Business Environment in The Republic of Serbia

Abstract

Certification of Business Friendly Municipalities (BFC process) is a process which promotes standards of efficient and transparent local administration and enables evaluation of the quality of the services that municipalities offer to businesses. Business friendly certification developed in 2007 in Serbia has been successfully tested in Croatia, FYROM and Bosnia and Herzegovina. The regional label Business Friendly Certification in South East Europe (BFC SEE) and a regional network of certification bodies have been established in 2013. The problem that is going to be concerned in the paper is based on the fact that local business environment is still marred by many impediments that reduce its attractiveness for investment.Assessment of local business environment in Serbia on the basis of twelve criteria used under the NALED methodology and seventeen certified cities and municipalities in Serbia can be obtained using different statistical methods. For the purposes of the present paper we applied cluster analysis and analysis of variance (ANOVA). Using cluster analysis, selected municipalities were clustered into three homogenous clusters according to the level of compliance with the given criteria. The analysis of variance was applied to determine the significance of differences in the average fulfillment of the criteria between previously determined clusters of cities and municipalities.