Review of Relevant Approaches for Evaluation of Development Potential: Use for the EU Regions

Regional development policies based on local potential triggers a shift in the economic structure of territories (country, regions, provinces, counties, cities). The shift in the structure of the economy is a rapid change in the economic structure as a policy strategy synergizing system of the various sectors in the regions that have an impact on economic performance, employment, public services, public participation, and other aspects. Developments are conducted in the form of planned changes in various aspects of social life by exploiting all the potential of human resources, natural resources, and institutions available in the region. The territorial to improve economic growth coupled with efforts to change the economic structure of the dominance of the primary sector towards improving secondary and tertiary sectors becomes very important. The question is what strategy is used to increase the effectiveness of regional development policies impact the shift in the economic structure of territory? Regional development strategies should be based on the sound assessment of regional resources, capabilities, competencies and core competencies, as well as on dynamic capabilities aiming to develop the resource configurations in order to form regional competitive advantage. Competitive advantage is based on its resource configurations, but these resource configurations have to territorial over time in order to keep them competitive. The main aim of the paper is to analyse the existing approaches to development potential, specialisation and performance of the European territory and to identify the key factors as background for a construction of the own composite index to an evaluation of development potential. Potential of regional development is determined by exogenous and endogenous factors and it is necessary to use different indicators and methods to its evaluation.