Measuring regional competitiveness on the basis of entrepreneurship, technological readiness and quality of institutions

Abstract

Purpose Developing composite index-regional entrepreneurship, technological readiness and institution quality index (RETRIQ) of regional entrepreneurship, technology readiness and quality of institution to measure regional competitiveness. This study, also, aims to test econometrically the effectiveness of the index in capturing the economic performance of the sub-national regions. Design/methodology/approach The data of eight indicators used in the index are from sources available freely in the public domain. The causal relationship analysis is done using panel data of 10 years from 2008 to 2017 for 32 Indian states/union territories. The generalized method of moments (GMM) is used for this dynamic regression estimation. Findings Based on RETRIQ, 32 states and union territories of India have ranked. The estimation using GMM shows a significant association between the composite index and economic growth. Research limitations/implications The limitations of the study include the broad assumption that these sub-national regions belong to a uniform macro-economic and technology environment and data constraints as it is a longitudinal study. Then, the implication of the study is that the composite index-RETRIQ could capture differences in regional competitiveness explaining regional economic disparity. Practical implications The index will be useful for policy implications in the assessment of competitiveness disparity. Originality/value It is a composite index of regional entrepreneurship, technological readiness and quality of the institution. The panel data across states along 10 years series is novel.