Economic development is important aspect of overall inclusive socio-economic development as includes increase of wealth or created economic values that are needed for appropriate needs satisfaction of people and quality lives. Traditionally, economic development was typically understood as sheer increase of wealth or planned changes in structure of production and employment that will bring increase of wealth generated in one society (at whatever level). With few exceptions (see more in section on approaches to development) development was mainly seen as an economic phenomenon in which rapid growth in national income will bring automatically benefits to wide masses of population in the form of job opportunities and other economic gains. The emphasis was on increased output which is measured by gross domestic product (GDP).

Today is clear that development represents multidimensional process which includes simultaneous changes in social structures, values, attitudes, institutions, as well as increased quality of life, reduction of inequality, and eradication of poverty. Economic development is indeed important aspect of this multifaceted process, but it has to be seen as precondition that creates material foundation for (but not guarantees) satisfaction of diverse needs of various groups enabling them to live quality lives and make choices that fulfill their potentials and aspirations, as understood in the view on economic development by Amartya Sen’s human development approach.

Indicators

Indicator definition

GDP per capita based on purchasing power parity (PPP) is gross domestic product converted to international dollars using purchasing power parity rates.

An international dollar has the same purchasing power over GDP as the U.S. dollar has in the United States.

GDP at purchaser's prices is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products.

It is calculated without making deductions for depreciation of fabricated assets or for depletion and degradation of natural resources. Data presented here are in current international dollars based on the World bank 2011 International Comparison Program (ICP) round.


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Source

World Bank, International Comparison Program database.
Data explanation

GDP represents value of total output produced in the country (excluding values produced within the ‘reproductive economy’). As such it indicates the capability of country to produce economic values which can be used for achieving appropriate levels of living standard and wellbeing of people. Longitudinal data on GDP levels in Serbia reveal picture of troubled economy. Due to the blocked post-socialist transformation during 1990s, marked by postponed reforms, wars and violent separation of Yugoslavia, destruction of institutions, industries, increase of informality, economic sanctions, etc., economy in Serbia was marked by severe drop down of GDP. Unlike the other post-socialist countries which also experienced recession due to the post-socialist reforms, Serbia was facing recession without transformation. Industrial production and service sectors (both related to modernization processes) sharply decreased.

Serbia has entered new phase in 2000 with fall of Milosevic’s regime and initiating period of intensive reforms. However, at this breaking point GDP was only on the level of 46% of GDP in 1989. Intensified structural reforms, accelerated privatization and foreign investments, rising productivity and decreasing hidden unemployment brought relatively high rates of economic growth which is reflected on increase in GDP per capita values. The impact of economic crisis in 2008, which was felt in Serbia in 2009, brought once more recession, and since then the real growth rate of GDP was very low positive or negative (in 2012 and 2014).

In comparison to other countries in the region Serbia is the most similar with Macedonia and closer to BiH than Croatia and Slovenia, which have much higher GDP per capita. According to the World Bank classification, Serbia belongs to the group of middle-income countries, but unlike some other middle income countries which record higher economic growth, economy in Serbia could be described as relatively stagnant.

Indicator definition

The employment rate is the percentage of employed persons in relation to the population of working-age (15-64) or population old 15 years and above.

It can be also calculated for specific age, gender or other groups.

An employed person is a person aged 15 and over (or 16 and over in Iceland and Norway) who during the reference week performed work - even if just for one hour a week - for pay, profit or family gain

Alternatively, the person was not at work, but had a job or business from which he or she was temporarily absent due to illness, holiday, industrial dispute or education and training.

This definition is aligned with International Labour Organization (ILO) standards and it is applied in Labour Force Surveys – main source of labour market statistics in Europe.


Year :


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Source

Eurostat, Statistical Office of the Republic of Serbia
Data explanation

Serbia has been struggling with low levels of employment for decades. The trends and pathways in Serbia are specific in comparison to other post-socialist countries in Central and East Europe. These countries shared experience marked by recession after the introduction of post-socialist reforms, and decrease of employment as consequence of privatization and restructuring. However, after some years economic growth was achieved and employment increased. Contrary to these patterns, Serbia experienced severe economic destruction during 1990s, decrease of GDP and high levels of hidden unemployment. Reforms after 2000 brought economic growth but also further decrease of employment due to the restructuring and privatization. While GDP growth rate was on average 5%, employment was decreasing on average by 3%. This trend of jobless growth was interrupted in 2009, when economic crisis struck. Economic research indicated that decrease of GDP in Serbia had stronger effect on decrease of employment than in other countries.

After the crisis, economy remain stagnant with low levels of growth, but employment has increased since 2013. Some explanations of the recent growth of employment see the reasons in prolonged economic stagnation, decrease of disposable income outside of employment (pensions, remittances, loans, rents) to which population responded by increasing labour supply, particularly through informal employment, self-employment and unpaid labour of family helpers. Still, the employment rate is lowest than in all EU member states, though it is similar to the countries in the region. Gender gaps in employment are very high and employment of women is among highest in Europe – higher only in comparison to Turkey, Macedonia, Montenegro, Greece and at the same level as in Italy. This gap is persistent in Serbia and rooted in complex social and historical factors (maintenance of patriarchal values governing gendered patterns of division of labour in public and private sphere despite the socialist legacy in relatively high employment of women, destruction of economy during 1990s, etc.).