INFLUENCING FACTORS OF RURAL AREAS DEVELOPMENT VIDZEME REGION CASE ANALYSIS

An important precondition for the growth of welfare of any nation is provision of sustainable economic development and increase of the competitiveness of the country. Nowadays it is possible to reach this goal by implementing a polycentric model of the country's development based on a balanced progress of the whole territory of the country, accessibility of services and growth of economics. The statistical data show a significantly different pace and level of economic development in rural areas in Latvia, including Vidzeme Planning Region. Therefore, it is necessary to evaluate the factors determining the differences mentioned above. Koceni and Mazsalaca Counties were selected for an expanded research in Vidzeme Region. The goal of this research is to identify the factors influencing the differences of economic development among counties, thus serving as the basis for creating a model of balanced and sustainable rural and regional development in the context of smart development. In order to identify the factors that determine the level and pace of the development in the research area and affect their performance, the authors have used the monographic method, carried out a statistical data analysis and interviewed focus groups of municipal staff, entrepreneurs and representatives of non-governmental organizations. The article examines theoretical concepts of sustainable and smart spatial development, depicts comparative analysis of economic development indicators in Koceni and Mazsalaca Counties in the context of sustainable development of rural areas. In the course of analysis, the main groups of factors influencing economic growth in rural areas were identified. The most important factors influencing performance of the area are: geographical location; entrepreneurial capabilities of residents; municipality's attitude and support to entrepreneurship; intensity of cooperation among the municipality, entrepreneurs and non-governmental organizations. The theoretical and practical results of the research will be used in the process of selecting indicators for creating a sustainable development model of rural areas and regions, as well as for defining proposals for the municipalities' policy performance in the context of development of smart territories.