Abstract
This paper focuses on the relationship between the government actions, global economic crisis, and competitiveness on a national and regional dimension. The Baltic States (i.e., Estonia, Latvia, and Lithuania) have experienced one of the biggest Gross Domestic Product (GDP) contractions during the Global Crisis so far. Meanwhile, Poland was the only country with a positive GDP growth in the European Union during the Global Crisis. Hence, identifying and assessing changes in the relative competitiveness, as a consequence of the economic downturn in both Baltic States and Poland, has sparked many interests.The main channel through which the crisis undermined competitiveness has been the macroeconomic situation. That is why employing single macroeconomic variables as proxies of competitiveness suggests a much stronger influence of the crisis on competitiveness in comparison to overall measures (e.g. Global Competitiveness Index). It may be generally concluded that a short-term crisis, even if severe, does not have a negative influence on international competitiveness as long as a proper anti-crisis policy is implemented and the country is small enough to react fast and adapt to new conditions in the global environment.
Highlights
The Global Crisis has affected different aspects of the global economy
A main goal of this paper is to identify and assess changes in the relative competitiveness of three Baltic States (i.e., Estonia, Latvia and Lithuania) and Poland; first, in consequence of the Global Crisis and second, in consequence of anti-crisis policy implementation in the Baltic States
Based on the conducted analysis discussed in the previous section, it should be acknowledged, beyond doubt, that the economic crisis strongly affected the competitiveness of the Baltic economies in comparison to Poland, which is clearly demonstrated by individual macroeconomic variables
Summary
Countries, corporations, and households have been hit by unexpected, dramatic and unprecedented events. These events have initially taken place in the financial markets and in the real economy. This paper aims at contributing to this broad and multifaceted discussion by concentrating on the impact of the crisis management policy (or mismanagement) realized by the government and central bank on the competitiveness of the business environment. The third section provides an overview of the crisis management policy in the Baltic States. The fourth section presents and discusses the results of comparative analysis in the field of economic measures of competitiveness and the descriptive competitiveness measure of the Baltic States in comparison to Poland in 2006–2013 (i.e. Global Competitiveness Index).
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