Growth without development: institutional barriers to convergence in EU candidate states

Abstract

This research analyzes the effect of institutions on economic growth in eight EU candidate transition countries, combining quantitative ((3-convergence models) and qualitative (integration maturity framework) methodologies. Drawing on three sets of theories-convergence, institutional economics, and integration maturity-we analyze whether the transition countries have experienced growth without development. The research question is: Why have they lagged on their path towards EU membership? To answer this, we test the research hypothesis that institutions have not had a sufficient impact on the convergence of transition countries towards the EU. The analyzed period is 2004-2022. Countries with efficient institutions tend to experience faster economic growth. This research shows that inefficient institutions are a reason why transition countries have not seized their 'advantage of backwardness'.