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Corvinus

The effects of the crisis on the convergence process of the Western Balkan countries towards the European Union

Nagy, Sándor Gyula and Siljak, Dzenita (2018) The effects of the crisis on the convergence process of the Western Balkan countries towards the European Union. Society and Economy, 40 (1). pp. 105-124. DOI https://doi.org/10.1556/204.2018.40.1.7

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Official URL: https://doi.org/10.1556/204.2018.40.1.7


Abstract

The aim of the paper is to analyze economic convergence of the Western Balkan countries towards the European Union member states with two types of measurement methodology, sigma and beta convergence. Sigma convergence measures the dispersion of real per capita GDP among the countries and beta convergence is based on the neoclassical growth theory. The main hypothesis of the paper is that the recent financial crisis has negatively affected the convergence process of the Western Balkan countries towards the twenty-eight member states of the European Union (EU-28). The relationship between selected macroeconomic variables and the rate of per capita GDP growth are econometrically tested. Sigma and beta convergence are estimated for the period 2004-2013 and two sub-periods: 2004-2008 and 2009-2013. The empirical findings support the hypothesis of economic convergence. The negative effects of the crisis on per capita GDP growth are confirmed, resulting in a slower convergence process. Dissimilarities between the growth patterns of the analyzed groups show the considerable heterogeneity of growth, i.e. the convergence clubs.

Item Type:Article
Uncontrolled Keywords:real convergence, European Union, Western Balkans, economic growth, club convergence
JEL classification:O47 - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
O52 - Economywide Country Studies: Europe
Subjects:Economic development
International economics
International relations
DOI:https://doi.org/10.1556/204.2018.40.1.7
ID Code:3420
Deposited By: Veronika Vitéz
Deposited On:09 May 2018 13:34
Last Modified:09 May 2018 13:42

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