The investment climate in Latvia's, Lithuania's and Belarus's cross-border regions: the subjective-objective assessment

Abstract

As the world experience indicates, the favourableness of investment climare or, in other words, a region’s entrepreneurial environment determines a region’s sustainable development. First assessments of investment climate were developed and applied by western experts in the middle of the 1960s. They were based on the subjective assessment of countries’ characteristics. The further development of the methodology for comparative assessment of countries’ investment climate started to expand and complicate the system of characteristics assessed by experts, and to introduce objective statistical indexes. In recent decades, more research into investment climate at the level of regions appeared, as a result of the understanding of a specific and unique character of regional features, as well as its dramatic differences from the country as a whole. It is possible to distinguish objective, subjective, and subjective-objective metholologies for assessment of investment climate. According to the outcomes of the subjective-objective assessment of the investment climate in Latvia’s (Latgale), Lithuania’s (Vilnius, Alytus, Utena, Panevezys, and Kaunas counties), and Belarus’s (Vitebsk, Grodno, Minsk, Brest oblasts, and Minsk city) cross-border regions, the regions under study were divided into 4 groups in accordance with W.Zapf’s Well-being Typology Matrix: 1) low objective and subjective indicators – Deprivation, 2) low objective indicators and high subjective indicators – Adaptation, 3) high objective indicators and low subjective indicators – Dissonance, 4) high objective and subjective indicators – Well-being.