Are entrepreneurship and human capital the drivers of regional growth?: Evidence from NUTS 3 sub-regions in Serbia

Abstract

The paper presents different concepts of regional economic growth, according to which the educational structure of the working age population and entrepreneurial activity significantly contribute to the improvement of economic performance. It also analyzes the role of the entrepreneurial activity and the quality of human capital in regional economic growth in Serbia in the period from 2011 to 2020 using a sample of 25 NUTS 3 level sub-regions. The results of the evaluation of the three selected panel models indicate that entrepreneurial activities play a vital role in the growth of gross added value at the level of the sub-region. Given the fact that the main theoretical and numerous empirical findings suggest that bearers of regional development should be entrepreneurs who possess the appropriate knowledge, abilities, creativity and skills, the recommendation for the creators of public policies is to continuously work on improving the business climate and building a stimulating entrepreneurial environment. Such an environment can encourage highly educated individuals to become the key bearers of entrepreneurial activities.