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Aim: This study examines whether the provision of key public services, specifically healthcare and early childhood education, supports human development and territorial competitiveness in Bulgaria’s predominantly rural districts, which experience some of the most severe demographic decline in the EU. Methods: A balanced panel of regional data covering 21 predominantly rural NUTS 3 districts over 2022–2024 is analyzed using entity fixed-effects regression with clustered standard errors. Five models are estimated with natural growth rate, death rate, and birth rate as dependent variables, incorporating health service supply, early childhood education provision, and economic and infrastructure controls. The Hausman specification test confirms the suitability of the fixed-effects estimator. Results: Health and early childhood education services influence demographic outcomes through distinct structural channels. Specialist physician density mitigates the mortality-driven decline, while kindergarten teacher density, identified as the strongest predictor, positively affects both fertility and mortality channels. This finding aligns with its function as an indicator of community vitality and a facilitator of parental labor force participation. Average annual wages emerge as the primary economic predictor of natural growth rates. The full model accounts for 78.9% of the within-district variation. Conclusions: Public service investment constitutes a necessary but insufficient condition for territorial competitiveness. The findings offer district-level empirical evidence supporting place-sensitive funding for rural early childhood education and the proactive deployment of primary healthcare in demographically distressed regions of Bulgaria.
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