Effects of the concentration of manufacturing industry on Croatian regional growth

Spatial concentration of economic activity is a phenomenon that has important implications for the development potential local, regional and national economy. This statement stems from two facts: first, there tendency people to concentrate in major cities regions; second, similar connected companies sometimes agglomerate together at particular location take advantages external economies. paper examines effects spatial manufacturing industry on Croatian growth. The industrial (especially sector) improves competitiveness among firms, enhances knowledge spillovers increases demand labor products, leading ultimately potentially higher growth rates. To examine growth, panel analysis conducted combining (21 counties) time (16 periods) dimensions. best way measure by using formula calculate quotients weather basis employment or gross value added. Therefore, are independent variables interest model whereas GDP, GDP p.c. Gross added put, prosperity output, respectively. Based results it can be concluded still an factor Croatia, although its relative significance economy continuously declining over last decades.