Implementation of special support measures and resolving its main problems with effective methods in medium-run may allow to maintain the dairy sector as a significant traditional element of the Latvian economy. It is important to know the gross economic effect of the Latvian dairy sector in order to take informed and rational support decisions. Authors have developed and approbated methods and by applying these have obtained new, unpublished data that characterize economic effect of the sector. The data have been analysed in Latvian and the Baltic States context. It is concluded that the dairy sector is significant to the Latvian economy mainly due to gross value added and especially because of its role in providing work opportunity. Authors call attention to reserves in gross value added growth per full time equivalent unit in the secondary production in all Baltic States. The data of the primary dairy sector level in turn indicate lower potential of growth that is evidenced by even a slight decrease in indicators of the comparatively more effective Estonian producer structure. Therefore, it can be expected that the weight of dairy sector secondary level in the dairy sector gross value added will increase. Authors point out certain possible solutions of the Latvian dairy sector's problems such as promotion of joint ownership structure. Main analysed indicators are gross value added at factor cost, use of labour in full time equivalent units and labour use effectiveness.

The development of the multi-storey residential areas in the Baltic Sea region shows an inequality that changes the spatial environment of the territory. The major part of the city territory is occupied by the multistorey residential area that reveals multiple problems of the spatial environment. Therefore, it is necessary to resolve these problems by building new more multi-functional zones in the multi-storey residential areas that would further ensure the sustainable development of the spatial environment. To find the relevant data and material, a scheme of questions for analysis was developed. The scheme reflects all the necessary aspects for the analysis of the landscape composition in multi-storey residential areas. The analysis from the theoretical aspect with the usage of empirical methods determined the current state of the multi-storey residential areas in the Baltic Sea region. The paper presents the study of historical development and the causes of changes, as well as the current state and potential future development of the landscape composition of the multi-storey residential areas. It also reflects the development framework of the landscape composition. The multi-storey residential area that carries a great load of the multi-functional areas, needs an improvement, a renovation and needs to be reconstructed and developed according to all the mentioned characteristics of the spatial environment.

Appropriate resources, availability of infrastructure, economic significance and food market forecasts determine the rationale for development of the dairy sector in the Baltic States. The sector is faced by significant economic problems; inter alia, production structure fragmentation, lack of investments and low labour productivity. Several sector's problems can be directly or indirectly solved by integration. Competition legal acts setting strict penalties directly and widely apply to integration processes, imposing a high level of legal risks on integrating parties. Thus, competition legislation forms a central framework limiting and guiding integration. As the subject has not been explored earlier, the author researched the Baltic dairy sector integration options at primary and secondary levels as influenced by the EU and Baltic national competition legislation and its implementation practice. Abstract-logical, monographic and interview methods have been used. The author concludes that law-compliant cross-border integration opportunities for the Baltic dairy sector exist to form larger integrated undertakings with higher market power. Reference to market shares in the competition legislation in countries with lower aggregate crude milk market sales puts the dairy sector participants at a disadvantage in case of integration processes resulting in smaller absolute size of the allowable integrated undertaking. Integration by agreements, decisions and concerted practices is appropriate for national level arrangements but is with limited applicability in the Baltic states cross-border integration at both levels of the dairy sector. In case of concentration, integration may be used to create cross-border integrated structures increasing concentration at every level of the Baltic dairy sector.

This paper discusses some aspects of introducing a new agricultural crop in Latvia – truffles Tuber spp. Truffles are mycorrhiza–forming mushrooms with edible fruit bodies developing in the upper layer of soil. In Latvia, there is a growing interest among farmers to start cultivate truffles. From several cultivated truffle species, the Burgundy truffle Tuber aestivum syn. T. uncinatum is the most suitable to cultivate in Latvia. There are both autochthonous and introduced tree species in Latvia, which are suitable for the Burgundy truffle cultivation and it is suggested to use Quercus robur, Corylus avellana, Tilia cordata and Fagus sylvatica. In order to find the regions in Latvia with the highest potential for successful Burgundy truffle cultivation, climate and soil characteristics had been co-analysed. By superimposing soil and climate maps of Latvia, the most suitable regions for truffle cultivation are situated in the central and southern part of the country. Considering the variability in soil composition even within regions in Latvia, it is thereafter also of great importance to investigate site-specific soil characteristics in order to find the most favourable grounds for truffle cultivation. Other truffle species which might be suitable for cultivation in the future are also discussed, as well as some general recommendations in establishing truffle orchards.

The aim of the paper is to show the general trend of consumption in the Baltic countries. The member states of the European Union attach great importance to the well-being, health and the promotion of healthy lifestyle. In order to be able to make decisions on the future plan of action, COBEREN (Consumer Behaviour Erasmus Network) carried out a project with an aim of studying the food consumption habits in the European Union countries. The obtained results show the consumer habits of each participating state, although not on the regional level. This study will look at the consumption habits in the Baltic countries and find out the nature of consumption in those three states. The statistical method – analysis of variance – was used to analyse the COBEREN data. The main conclusion is that consumers of the Baltic countries do not differ greatly in their consumption habits.

Baltic States’ dairy sectors are important to their economies. All Baltic States have had substantial current account deficits that exceeded acceptable thresholds until the year 2009. The States are dairy product exporters. Export capability largely depends on international competitive position of dairy processing companies. Several factors, inter alia, company size determine the position. Largest companies have been formed by horizontal integration. At Baltic scale dairy processing is still fragmented. The aim of this paper is to evaluate economic effect aspects of integration related to exports in the Baltic States’ dairy sector secondary level. As the subject has not been explored earlier at company level, the author researched data of 188 annual reports of 53 Baltic dairy processing companies over the period 2003 to 2009. Descriptive statistics, time series analysis and regression analysis methods were primarily used. The author establishes that among dairy companies which generate significant exports turnover two-thirds are horizontally integrated and include all largest dairy processing firms in the Baltic States. A few smaller firms have succeeded in exporting due to suitable channel management. Among a large group of companies that generate less than 1% turnover from exports, 77% are non-integrated and all are small. Using regression analysis the author estimates that 1% increase in net turnover in the exporting dairy company group is expected to create 0.93 – 0.94% increase in net turnover from exports. Policies promoting mergers of some companies may thus lead to increased dairy exports, higher milk production and fuller realisation of economic potential of the sector.

Smart specialisation strategy (RIS3) is topical for each European Union member state – including the Baltic States. It is a smart tool for the European Union (EU) Structural Funds absorption from 2014 to 2020. Each EU member state has set their own priorities based on the country specialisation and economy strengths and weaknesses. For RIS3 development evaluation, there is RIS3 Assessment Wheel developed – a tool for assessing the RIS3 in a chosen region and positioning it between other regions. The aim of research is to find main differences between RIS3 development in the Baltic States. The tasks of research are 1) to compare existing RIS3 Assessment Wheel of Latvia and create authors version of RIS3 Assessment Wheel of Latvia; 2) to create RIS3 Assessment Wheel of Lithuania and Estonia; 3) to make comparisons between created RIS3 Assessment Wheels. The research performed is mainly based on the desk research by using content analysis and the monographic method. In all three Baltic States, there is a lack of information available about revision of priorities in connection with RIS3 development. In order to achieve the aims set in RIS3, it is essential to finish work on RIS3 legislation in Latvia, and introduce the systematic approach to RIS3 target evaluation in all Baltic States.

The productivity and its performance is one of the core topics of economics studies. The growth of productivity is an indicator of competitiveness, as well as a possible way to achieve economic growth and wellbeing. After joining the EU, the agriculture of the Baltic countries faced increasing competition of the EU Single Market, while having relatively lower productivity indicators. Since 2004, significant structural changes have taken place in the agriculture of the Baltic countries, and it is a topical question whether these changes and overall trends in the agricultural sectors of the Baltic countries have facilitated to increase productivity. Therefore, the objective of the study is to evaluate the productivity growth of the main production factors and the total factor productivity growth in the agriculture of the Baltic countries between 2004 and 2015, in relation to the changes in the use of the production factors. The paper focuses on the value added as output, and land, labour and capital as individual inputs to obtain partial productivity measures. The evaluation of TFP is based on the Index number approach, where TFP growth is a ratio of the Output index to the Input index. The calculations and analyses show that since 2004 both the agricultural output and value added have increased in the agriculture of the Baltic countries, and also productivity performance has improved.

The processes of globalization in the world economy have a significant impact on different processes and development in all national economy sectors. Innovations and technological development have also increased the competition between economic operators. Faster growth is also observed in service industries. The global economic downturn affected the Baltic States whose development suffered a sharp decline at the end of 2008 and in 2009. A sudden drop in the demand in export markets, as well as the decline in the demand in the domestic markets due to low purchasing power contributed to the deterioration of the economic situation in the Baltic States, particularly in the manufacturing and construction sectors. Starting from 2011, the economic indicators in the Baltic States have been growing and here the export of goods and services can be mentioned as the main contributor to the development of the economy in the Baltic States. Significant changes in the development of economic sectors started in 2013 due to Russia’s economic problems. During the period 2005 – 2015, most of the value added to the overall structure of the national economy in all three Baltic States was brought by trade and manufacturing. The aim of the research is to analyse the national economy sectors in the Baltic States during the period 2005 – 2015 in order to determine processes that affected the development of economy sectors in each of the countries, or the opposite – the recession, thus finding the most competitive sector of the national economy of the Baltic States.

The legal regulation of the public sector auditing among the Supreme Audit Institutions (SAI) of the Northern and Central-European countries holds the potential to offer new perspectives on the functioning and independence of these public audit institutions. This paper aims to examine the external audit practice among the Baltic Sea Region countries as it is defined in the laws and legal acts aimed at the functioning of the particular institution. The task was carried out by conducting an analysis of the legal regulation of the corresponding supreme audit institutions. Overall, SAIs in the Baltic Sea Region closely cooperates with the Parliaments in the reporting phase. Meanwhile, most of them are closely integrated with the legislative power during the phase of the appointment of the head of the audit institution as well as during the budgeting phase and later on during the reporting phase. The research shows that among the Baltic Sea Region countries the Supreme Audit Institutions pursue audits in diverse range of fields as stipulated in the legal regulations. The paper also indicates a space for further research in the field of the SAI legal regulation, audit merit and further interrelation with the executive and legislative powers as well as the impact of such cooperation on the functioning of the accountability system in the particular country.