The role of institutions in regional development

Abstract

Regional disparities have been a focus of scientific discussions for more than a century. Today, economic growth or development factors are as much important as, for example, sustainable development factors in the environmental and social dimensions. Social equality and public participation in state and environmental governance - through regional institutional cooperation - are among the priorities of sustainable development. Research on institutional cooperation is an urgent priority. Previous research studies indicated that local governments in the regions of Latvia implemented isolationistic policies both at the horizontal and at the vertical level, which was promoted by their competition aimed at benefiting themselves, ignoring common public interests. Previous cooperation among regional institutions was fragmented and based on short-term economic interests. The research aim is to assess the role of institutional cooperation, placing a special focus on research done by national economists. After performing a literature review, the authors concluded that the research papers of both foreign and national researchers have stressed the essential role of institutional cooperation in regional economic development. Further and more detailed research has to be done on the pace of territorial growth, depending on local and national institutional cooperation.