Volume 16 (1998)

The Regional Problem and the Break-Up of the State:
The Case of Yugoslavia
Časlav Ocić

The Nature and the Scope of the Regional Problem
Regional Policies and Changes in the Institutional Framework
Regional Development Levels: Grouping of Regions
Structural Change: Shift-Share Analysis
Efficiency: Shift-Share Analysis
Interregional Relations: Autarky
Some Other Results of the Regions' Development
Regional Development Costs: Ratios of Investment
Interregional Income (Re)distribution
Regional Convergence or Divergence?
Equality: The Failure of the Positive Discrimination Model
"The National Question" and Nationalism
Separatism: Economic and Political
A Long Journey from Utopia to Dystopia
Selected Bibliography
Data Sources & Documents
Appendix  (1)  (2)

Regional Development Levels: Grouping of Regions

Starting from a fundamental concept according to which development is a multidimensional phenomenon, our analysis of regional development levels, i.e. regional differences, was initially based on a wide range of indicators. In the final stages of research a smaller number of indicators of overall regional development levels was chosen.6 Among these are the following: (1) original value of fixed assets in the social sector per working-age inhabitant; (2) share of workers in working-age population -representing "productive forces"; and (3) gross national product -GNP per capita representing the effects of "productive forces."
The relative values of the indicators of economic development levels of Yugoslav republics and provinces show that the differences between the most developed region and the least developed region are the largest with the indicator that represents the effects of "productive forces"(per capita gross national product -GNP), and narrowest with the indicator of the employment level (number of workers in the social sector per 1000 working-age inhabitants: EMP). The range of the development levels of the material element of the "productive forces"(fixed assets per working-age inhabitant: CAP) are closer to the range within the first indicator (GNP) than within the second one (EMP). In addition to regional policy reasons, these trends can also be explained by important theoretical and methodological reasons: the so-called per capita indicators (such as the above CAP and GNP) have been observed to vary more than the structural indicators (here: EMP). In fact, this is a case of two different "qualities of time"in which per capita and structural changes are taking place. Therefore these two types of indicators are useless unless they are somehow standardized. Here standardization has been done as a prerequisite for the factor and cluster analyses. Individual features (indicators) were replaced by a synthetical representation of three characteristics of the economic development level of republics and provinces. Republics and provinces were grouped on the basis of their relationship to this synthetically expressed level of economic development. The relationship is measured by the distance between the points which represent such objects (and their groups or clusters) in a multidimensional space.
Regions were clustered together according to the degree of similarity: those grouped first were the regions closest to one another regardless of their economic development levels. The results of the factor analysis clearly show both the level of development and the classifying patterns of regions, on the basis of the value of the points scored by regions on the main factors. The main factors (taken together) explain the largest part of the variance, but not the entire variance (in this case only a negligible percentage remained unexplained). Cluster analysis encompassed and synthesized all the information contained in the indicators. Thus the two methods are supplementary and also mutually verifiable. Both can be used for the classification of regions.
Matrices of initial distances reveal that the largest difference in economic development levels was that between Slovenia and Croatia in all the observed years. In fact, this difference divide all the observed regions into two groups. One group consists of Slovenia only, while the second group includes all the other republics and provinces. At first sight the latter seems highly heterogenous: however, for most years, the distance between Croatia (the most developed region in the group) and Kosovo-Metohia (the least developed region in the group) was narrower than between Croatia and Slovenia. This dichotomy does not reflect the true complexity of the Yugoslav situation in terms of regions. The results of the factor analysis (crosschecked by cluster analysis) give a precise picture of the actual regional differences over the 1950-1987 period: in 1950, 1952, 1955 and 1960 Yugoslav regions fall into five groups, differently composed in each year. For all other years (except 1970) the republics and provinces form four groups, following the same pattern of grouping (again except 1970) with changes occurring only in the positions of the members of the third group, i.e. central Serbia (Serbia minus the autonomous provinces of Vojvodina and Kosovo-Metohia), Montenegro, Bosnia-Herzegovina and Macedonia. In general, the position of certain regions on the (under)development scale is quite stable: for instance, Slovenia, Croatia and Kosovo-Metohia retained the same position throughout the observed period. The least stable was Bosnia-Herzegovina which changed its position six times over thirty seven years, and even changed its development classification group for times.
The stable configuration of republics and provinces according to their levels of economic development over the last twenty five years of the existence of former Yugoslavia suggests a need to define four distinct groups of regions. The name of the group should specify the most important typical features of republics and provinces included. Since many of these features are structural and since only the level of economic development is discussed here the following names were chosen: the most developed, developed, underdeveloped and the least developed groups. During the 1965-1990 period the four groups of regions included the following republics and provinces: (1) the most developed regions: Slovenia; (2) developed regions: Croatia and Vojvodina; (3) underdeveloped regions: central Serbia, Montenegro, Bosnia-Herzegovina, Macedonia; and (4) the least developed regions: Kosovo-Metohia.7