VÝDAJE KRAJSKÝCH ÚŘADŮ NA REGIONÁLNÍ ROZVOJ # EXPENDITURES OF REGIONAL AUTHORITIES INTO REGIONAL DEVELOPMENT

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1 VÝDAJE KRAJSKÝCH ÚŘADŮ NA REGIONÁLNÍ ROZVOJ # EXPENDITURES OF REGIONAL AUTHORITIES INTO REGIONAL DEVELOPMENT ANTOUŠKOVÁ, Michaela, KAPLANOVÁ, Michaela Abstract The article focuses on expenditures of regional authorities into regional development. In its first part it analyses expenditures in individual regions and measures the disparities among regions. These disparities are measured by standard statistical indicators, especially coefficient of variation, and inequality indexes, especially the Gini coefficient and the Lorenz curve. In the second part, the paper analyses the expenditures into regional development in the chosen region, which is the South Bohemian region. Key words: Regional development, Expenditures, Disparities, Budget. Abstrakt Příspěvek se zabývá výdaji krajských úřadů do regionálního rozvoje. Ve své první části se zaměřuje na výdaje v jednotlivých regionech a analyzuje jejich disparity. Tyto disparity jsou měřeny pomocí standardních statistických ukazatelů, konkrétně variačního koeficientu a také dalších ukazatelů nerovností, Giniho koeficientu a Lorenzovy křivky. Ve své druhé části se příspěvek zabývá analýzou výdajů do regionálního rozvoje ve vybraném regionu, jímž je Jihočeský kraj. Klíčová slova: Regionální rozvoj, Výdaje, Disparity, Rozpočet. Introduction Regional development The terms of economic development and economic growth are sometimes used interchangeably. Development refers to all changes in the economy including changes in economic structure that accompanies changes in output or GDP. An increase in GDP and per capita output as an indicator of economic development is a part of the growth process. That is, economic growth is the entire process that results in higher per capita output or per capita income. (Borts, 1985) # Pieces of knowledge introduced in this paper resulted from solution of an institutional research intention MSM Economics of resources of Czech agriculture and their efficient use in frame of multifunctional agri-food systems and IGA 1112/1213/11/3132. Poznatky uváděné v příspěvku vyplynuly z řešení IVZ MSM "Ekonomika zdrojů českého zemědělství a jejich efektivní využívání v rámci multifunkčních zemědělskopotravinářských systémů"a IGA 1112/1213/11/

2 Research on regional growth and development factors encompasses plenty of fields and different approaches which are the subject to frequent changes over time. Last three decades witnessed profound changes in theories of regional development. Exogenous conceptions related primary upon external financing and interventions. These conceptions succinctly describable as top-down approaches were gradually replaced by remade, so-called bottomup conceptions that stressed the importance of internal, endogenous potential of the territory. (Kern, Malinovsky, Sucháček, 27) However these bottom-up approaches do not mean mere purification of traditional endogenous conceptions, on contrary they represent the transformed conceptions which accentuates namely the shaping of frame conditions for sake of stimulation of endogenous developmental potential in individual regions. They may be also called neo-endogenous conceptions. More importantly, neo-endogenous approaches towards regional economic development became commonly accepted paradigm of our days. (Indiastuti, 23) Budgets in the Czech Republic In the Czech, regions cannot decide on issuing taxes. This responsibility is on the Czech Parliament. The system for financing local administrations is continuously developing. During the first two years of the regions' existence only a provisional resolution was chosen; on the basis of this resolution the regions were financed mainly through government subsidies granted for specific purposes. The regions' current duties as imposed by law include the areas of regional development, highway maintenance, transportation, schooling, social care, culture and health care facilities. But finances provided to the regions to cover these tasks independently have proven to be insufficient. In 22 the regions became the recipients of a portion of shared taxes, and in 24 this amount was 3.1 per cent. Public finance reform is currently underway in the Czech Republic, and a part of this reform is expected to be a radical increase in the portion regions receive in shared taxes. The goal of the regions is to implement a system of financing that will allow the regions to undergo complex development in accordance with the needs of its residents. (Vagenknechtová, 27) Materials and Methods The article focuses on expenditures of regional authorities into regional development. The aim of the article is to analyze disparities in these expenditures among individual regions and to analyze expenditures into regional development in the South Bohemian region. All date used in the article are derived from proposed budgets of regional authorities for the year 27. To analyze the disparities there were used standard statistical indicators, especially coefficient of variation, and inequality indexes, especially the Gini coefficient and the Lorenz curve. The coefficient of variation - the coefficient of variation represents the ratio of the standard deviation to the mean. Lorenz Curve - The Lorenz graph shows contrast between the absolute equality and the absolute inequality and the real disparity. The disparity is measured by variation between the Lorenz curve and the absolute equality curve. The greater variation means the greater disparity. Gini coefficient - the Gini coefficient comes out the Lorenz curve and quantitatively shows its conclusions. It is definited as the ratio between two surfaces in the Lorenz graph. If the surface between the absolute equality curve and the Lorenz curve is marked A and the surface below the Lorenz curve is marked B, the Gini coefficient can be enumerated as A/(A + B). 9

3 Results Expenditures into regional development in the Czech Republic Expenditures into regional development differ in individual regions. Also the system of distribution financial means to regional development varies at individual regional authorities; there is a defined area of regional development at some of them, at others regional authorities there is the area of regional development combined with other areas, such as strategic planning, landscape planning or investments. There are two regional authorities, regional authority of Moravian-Silesian region and regional authority of Southern Moravia region, which do not have any defined area for spending into regional development. Graph 1 Expenditures per capita (CZK, 27) Expenditures into regional development per capita Zlín Olomouc Vysočina Pardubice Hradec Králové Liberec Ústí nad Labem Karlovy Vary Plzeň Southern Bohemia Central Bohemia Source: Czech Statistical Office The budget planned for the year 27 of all regional authorities (except Southern Moravia and Moravian-Silesian authorities) is over 816 mil. CZK, that means 12,2 CZK per capita. The greatest amount of expenditures per capita is planned to be spent in the South Bohemian and Karlovy Vary regions (over 18 CZK). On the contrary the lowest amount of expenditures is planned to be spent in the Zlín region. In the Central Bohemia there would be spent over 7 % of all expenditures into regional development, which means the highest percentage of all regional authorities spending. The lowest percentage of expenditures into regional development may be indicated in the Zlín region. Graph 2 Disparities in expenditures into regional development (25) Lorenz curve expenditures into regional development absolute equality line Source: Own calculation 1

4 Disparities in expenditures into regional development per capita among individual regions may be well documented on the graph 1. The coefficient of variation is high (.5) and another indicator of variability, the Gini coefficient runs around.2. Variability may be also demonstrated well by the Lorenz curve (graph 2). Expenditures into regional development in the South Bohemian Region The South Bohemian regional authority has changed the area of supporting regional development in budgeting several times. In the year 24 the section was the same as today, the area of regional development was combined with landscape planning and structural investment. In the year 25 and 26 there was running a section of regional development and European integration. For the year 27 the South Bohemian regional authority planes well-balanced budget. The revenues are planned over 9 17 mil CZK and the expenditures are planed over 9 62 mil CZK. The difference will be covered by the profit from last years and by the bank credit from European International Bank. The most supported areas from the budget are education and youth, and transportation and road infrastructure. Graph 3 Expenditures into regional development in the South Bohemian region ( tsd. CZK) regional development total Source: South Bohemian regional authority The South Bohemian authority setted off over 115 mil. CZK for regional development, landscape planning and structural investment from the budget in the year 27 divided half and half between current and capital expenditures. The amount of expenditures has risen by 44 % between the years However the percentage of spending for regional development from total expenditures has declining tendency between the years 24 27, the only exception was the year 26. Graph 4 Budget planning for regional development (mil. CZK) regional development en total activities w ithout EU investments w ithout EU financing European projects grants and subsudies financing municipalities 1 UR Source: South Bohemian regional authority 11

5 The South Bohemian authority also stated the scheme of expenditures into regional development planned between years (graph 4). The expenditure would rise by 43 % between the years The greatest part of all expenditures would be made by financing European projects. These expenditures should rise from 196, 9 mil CZK in the year 26 to 329,2 mil CZK in the year 213 (by 67%), the highest amount of expenditures is planned to be spent in the year 212 (651 mil CZK). On the contrary the smallest part of expenditures would be made by grants and subsidies. Conclusion The expenditures into regional development vary in individual regions. The regional authorities have also different system of distributing the finance for regional development. The greatest amount of expenditures per capita may be indicated in the Southern Bohemia, and the lowest one in the Zlín region. The disparities among individual regions may be well documented on coefficient of variation (,5) and Gini coefficient (,2). The article focuses especially on the South Bohemian region and it s expenditures into regional development. The expenditures in Southern Bohemia into regional development make almost 2 % of all expenditures in region. However the percentage of spending for regional development from total expenditures has declining tendency between the years In the future the regional authority plans the greatest part of expenditures in the area of financing European projects. Literature [ 1 ] BORTS, G. H.: An Approach to Measuring Regional Growth Differentials. Papers in Regional Science, January 1985, vol. 4, no. 1, s ISSN [ 2 ] INDIASTUTI, R.: The Financing of Regional Development and Economic Growth in West Java Province. In Working Paper in Economics and Decelopment Studies, July 23 [ 3 ] KERN, J., MALINOVKY, J., SUCHÁČEK, J.: Learning Regions in Theory and Practice. Ostrava: VŠTB Ostrava, 27. ISBN [ 4 ] VAGENKNECHTOVÁ, M.: Association of Regions of the Czech Republic. [online][cit ].dostupné < 1529> Adresa autorů: Antoušková Michaela, Kaplanová Michaela Česká zemědělská univerzita v Praze Provozně ekonomická fakulta / Katedra zemědělské ekonomiky Kamýcká Praha 6 - Suchdol Česká republika Telefon: antouskova@pef.czu.cz, kaplanova@pef.czu.cz 12