Identification of contribution of clusters to economic growth in the Baltic States: does gross value added matter?

This paper examines the impact of clusters to the economic growth in the Baltic States over a period of 2004-2012. The performance of the Baltic States’ economies is being investigated using the size of employed persons as a factor of strong clusters in regions having an impact on the economic performance output that was measured as a size of gross value added of each economic activity. Thus, the paper aims to find out whether the Baltic States are homogeneous in the composition of gross value added of their economic activities and economic development trends. The research was carried out into the size and structure of the gross value added of economic activities and the analysis of the relationships of the employment share and the gross value added share of economic activities. All of these issues are relevant to the research into the economic impact of clusters. The paper argues that the composition of the gross value added of economic activities across the Baltic States is observed to be similar in those whose share is above 10 percent of the gross value added of all the economic activities. Also, the analysis indicates that the impact oflabor input on the gross value added share of the economic activity differs across the Baltic States. The authors believe that the findings of the study add value in cross-country comparison of the Baltic economies and promote discussions on the formation and sustainable development of clusters in the Baltic States