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Post crisis Remodeling of the Economy for the Sustainable Growth of South Eastern European Countries

Nenovski, Tome (2012): Post crisis Remodeling of the Economy for the Sustainable Growth of South Eastern European Countries. Forthcoming in:

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Abstract

Every bigger economic crisis, as the current one, leaves behind a huge material damage to the world economy, and to separate national economies as well. However, every such crises reminds national authorities of the mistakes done in the past while creating and running macroeconomic policy and teaches them how they should overcome them in the upcoming period. The economic growth model of selected South Eastern European economies (Albania, Bosnia, Macedonia, Serbia, Slovenia, Croatia, Bulgaria and Montenegro) during pre-global economic crisis was based mainly on foreign demand and capital inflows which created big external imbalances in those countries. It was main reason why those countries were exposed to big vulnerability of external shocks. But, the crisis reshapes the world economic map. Competition on world markets gets new forms and players. The lessons learnt from economic crisis say there is a need for revising the pre - crisis economic growth model in the selected countries as they to be less vulnerable to external shocks. New economic model will enable their long lasting and more sustainable economic growth in future. One approach of remodeling their economy is presented in this paper. The main finding of this research is that instead of experiencing external ‘push’ factors for economic growth by the Governments, a promotion of internal resources is needed in order to enable for “the catching up” process of these countries to continue. But, all those countries are members or candidates for becoming EU members. That means there is no room for application on entirely new economy growth model since those countries have to create economic model which has to be convergent to EU one. There must be different approach by individual countries in remodeling their economies. The findings of this survey are intended to indicate the policy makers of the selected SEE countries the mistakes they made before and during the economic crisis and the need and directions for remodeling their economies in the post-crises period that will enable their long lasting and more sustainable economic growth in future. The position assumed for this research is interpretative using qualitative methods of research. In order to ensure comparability among results, the proposed methodological design will be multiple-case study research on the selected SEE economies.

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