The problem of regional inequality in socio-economic development Research Document
Members of the study group consisting of graduates of the "Young Economists” trainings provided by the Institute for Democratic Initiatives (IDI) have prepared a study paper on the problem of regional inequality in socio-economic development.
This policy paper analyzes policies implemented by the government since 2002 to reduce inequality in regional socio-economic development and achieve balanced regional development and makes recommendations for improving this policy.
The first part of the study analyzes the current state of inequality in regional socio-economic development on the basis of official statistics and examines its causes.
The study then examines the policy steps taken so far by the government to address this problem and presents the results of these policies and the results obtained from the study.
At the same time, on the basis of international experience, the directions of necessary changes needed to be made in government policy are presented in order to reduce inequality in the socio-economic development of the regions and achieve balanced development of the regions.
In the end, these directions are specified and presented in the form of recommendations.
The study leads to the conclusion that despite the implementation of three state programs for socio-economic development of the regions in Azerbaijan since 2004, as well as the expiration of the implementation period of the Development Concept "Azerbaijan 2020: Look into the Future”, there are still serious problems in bridging the gap between the socio-economic development of the regions in the country.
Summarizing the analysis of the study, it can be said that there are sharp differences in all parameters of socio-economic development of the country, both between the Baku-Absheron zone and other regions of the country and between the rest of the regions of the country themselves except Baku-Absheron. Therefore, the study proposes to carry out reforms both in the field of management and regulation of regional development and in the field of mechanisms for stimulating the economic development of the regions to reduce inequality in the socio-economic development of the country and ensure more efficient and balanced development, and makes the following recommendations:
1.It is necessary and expedient to establish a separate central government body responsible for regional development in Azerbaijan;
2.It is necessary to develop special programs for the development of economically problematic regions and regions with unfavorable geographical conditions;
3.It is expedient to develop a special development program for each economic region in Azerbaijan;
4.It is important to strengthen the administrative and financial capacity of municipalities in order to increase their participation in solving regional socio-economic problems;
5.In regional economic development, the cluster approach should be introduced and appropriate strategies should be developed;
6.An analysis of the cluster potential of the regions should be conducted on the basis of quantitative and qualitative methods that allow assessing the competitiveness of the regions;
7.Special requirements must be set for the creation of clusters.