Online ISSN 2286-0266
Print ISSN 1223-0685
© 2023 Œconomica by ASE & SOREC
Academia de Studii Economice din Bucureşti
This paper aims to assess the relationship between economic competitiveness, on the one hand, and the quality of the business conditions, on the other, at the level of the Member States of the European Union. Favourable business conditions are illustrated by the level of economic freedom and by the quality of the national regulatory framework, as parameters characterizing the quality of the business environment. For the quantitative evaluation of the above-mentioned relationship, we use the Competitiveness Index as a proxy variable for the expression of economic competitiveness, respectively the Economic Freedom Index and the Regulatory Quality Index, for the quality of the business environment. In this research, we demonstrate the hypothesis that economic freedom and the quality of the national regulatory framework have a differentiated impact on economic competitiveness. The objective of our analysis is to quantify and rank the robustness of the link between economic competitiveness and the two politico-economic dimensions, in order to identify the variable whose priority improvement would lead, differentiated by country, to increasing economic performance. The results suggest that the quality of legislation clearly outperforms economic freedom in explaining EU-wide competitiveness, but for countries with a competitiveness deficit the explanatory contribution of the two variables is differentiated in order of prevalence.

ŒCONOMICA no. 3-4/2022
Keywords: economic competitiveness, economic freedom, regulatory framework, European Union
JEL: F01, F50, K00
The Impact of the Business Environment Quality on Economic Competitiveness in the European Union