Regional remuneration divergence in Slovakia: The role of FDI as a conditioning factor
Regionálna divergencia odmeňovania na Slovensku: úloha PZI ako podmieňujúceho faktora
Ekonomika a spoločnosť, Volume 26, Number 2/2025
DOI: https://doi.org/10.24040/eas.2025.26.2.1-13
Odporúčaná forma citácie článku:
Budová, J. & Leščinská, L. (2025). Regionálna divergencia odmeňovania na Slovensku: úloha PZI ako podmieňujúceho faktora. Ekonomika a spoločnosť, 26 (2), 1-13. https://doi.org/10.24040/eas.2025.26.2.1-13
Recommended form for quotation of the article:
Budová, J. & Leščinská, L. (2025). Regional remuneration divergence in Slovakia: The role of FDI as a conditioning factor. Journal of Economics and Social Research, 26 (2), 1-13. https://doi.org/10.24040/eas.2025.26.2.1-13
ABSTRACT
The study examines regional disparities at the NUTS 3 level in Slovakia over the period 1996–2022 through real convergence in remuneration per capita. Building on the theoretical framework of regional convergence, the analysis assumes that less developed regions should exhibit faster growth, allowing observed trends to be evaluated in the context of expected convergence or divergence. The aim is to quantify disparities and examine the relationship between foreign direct investment and remuneration dynamics. Conditional β-convergence and robustness-based σ-convergence are applied, complemented by the Lorenz curve and the Gini coefficient. The estimates indicate β-divergence: regions with higher initial remuneration experienced larger absolute increases, leading to widening differences. The relationship between FDI and remuneration growth is positive but only marginally significant. The results also confirm σ-divergence and a rise in inequality as measured by the Gini coefficient. The findings clearly show that regional disparities in remuneration continue to widen, while the link between foreign direct investment and wage growth remains weak. These results highlight the need for a deeper examination of the mechanisms shaping regional wage formation and the factors driving persistent divergence across Slovak regions.
Key words: Remuneration. Beta-divergence. Sigma-divergence. Regional disparities.