DETERMINANT FACTORS OF ECONOMIC RESILIENCE OUTPUT INDICATORS. A PRINCIPAL COMPONENT REGRESSION APPROACH
DETERMINANT FACTORS OF ECONOMIC RESILIENCE OUTPUT INDICATORS. A PRINCIPAL COMPONENT REGRESSION APPROACH

Summary/Abstract: This paper investigates the determinant factors influencing economic resilience output indicators in a sample of European Union (EU) countries using a principal component regression (PCR) approach. Economic resilience, defined as a country's ability to withstand and recover from economic shocks and crises, has become an increasingly crucial aspect of economic policymaking in a highly interconnected global landscape. To identify the key drivers of resilience, we employ principal component analysis (PCA) to reduce the dimensionality of a comprehensive set of potential determinants. The retained principal components serve as predictors in a linear regression model to estimate their impact on economic resilience output indicators. The study's findings reveal a set of critical factors that significantly influence resilience, enabling policymakers to design targeted strategies and policies to enhance countries' capacity to navigate economic uncertainties and challenges effectively. The research contributes to the understanding of economic resilience and offers valuable insights for policymakers aiming to foster sustainable economic growth and stability in the EU.

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