The Policy of Urbanization Growth and Its Effects in the Albanian Economy in 1984–2020

Abstract

Numerous scholars have studied the connection between urbanization and economic growth for particular nations or regions. In their research, urbanization is considered both a cause and a consequence of the process of economic development. By continuing to experience significant economic growth, Albania has recently set itself apart from the other Balkan nations. Urban areas, particularly those that have expanded substantially, have seen the repercussions of such a transformation – both positive and negative – in the economic and spatial realms as well as in people’s daily lives. Although there is a considerable correlation between urbanization and economic growth in other countries, Albania has yet to address the question of whether urbanization drives economic growth or vice versa – they are independent of each other. The analysis of the connection between urbanization and economic growth in the Albanian reality in the years 1984–2020 is the main goal of the article. World Bank data for the years 1984–2020 were used for this purpose. The methods used are the regression analysis and the Granger causality test.