1. bookVolume 9 (2019): Issue 1 (June 2019)
Journal Details
License
Format
Journal
eISSN
2674-4619
First Published
18 Jun 2013
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2 times per year
Languages
English
access type Open Access

Do Transition Countries Converge towards the European Union?

Published Online: 30 Jul 2019
Volume & Issue: Volume 9 (2019) - Issue 1 (June 2019)
Page range: 115 - 139
Journal Details
License
Format
Journal
eISSN
2674-4619
First Published
18 Jun 2013
Publication timeframe
2 times per year
Languages
English
Abstract

The aim of this paper is to analyze if the Western Balkan and Eastern Partnership countries converge towards the twenty-eight members of the European Union. The relationships between the selected macroeconomic variables and per capita GDP growth rate are econometrically tested to support this research. The analyzed period is 2004–2017, with two sub-periods: 2004–2008 and 2009–2013. The subdivision is made to test whether the recent financial crisis affected the absolute and conditional convergence process in the analyzed group of countries. The empirical findings support the economic convergence hypothesis. The results show that the recent financial crisis negatively affected the absolute and conditional convergence process, when economic variables are included in the analysis. The negative effects of the crisis on conditional convergence with economic and socio-political variables are not identified. The poorer countries in the analyzed group should do more to attract investment and open their economies, as gross fixed capital formation and economic openness have a positive impact on per capita growth, and keep low inflation or stabilize it, while general government debt and unemployment should be decreased in the examined sample of countries.

Keywords

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