EconPapers    
Economics at your fingertips  
 

Income convergence in Europe: Catching up or falling behind?

Megan Czasonis (mczasonis@statestreet.com) and Michael A. Quinn (mquinn@bentley.edu)
Additional contact information
Megan Czasonis: Bentley University, Department of Economics, 175 Forest Street, Waltham MA 02452, USA
Michael A. Quinn: Bentley University, Department of Economics, 175 Forest Street, Waltham MA 02452, USA

Acta Oeconomica, 2012, vol. 62, issue 2, 183-204

Abstract: One of the motivations for a country to join the European Union is the belief that this will boost short- and long-run incomes. Researchers have tested the hypothesis of income convergence in different settings using either regression or unit root analysis, with mixed results. In this paper, we use both methods on the same samples over a significant time period. This allows us to judge differences in results across varied time-frames and methodologies. The focus of these tests is on convergence to German and EMU average incomes by Eastern European countries and those within the Euro-zone from 1971–2007. The evidence for convergence is mixed. Among the Euro-zone countries, there is more evidence of convergence in the 1970s and 1980s than recently. There is significant evidence that Eastern Europe experienced convergence and that capital formation was one of the root causes. While the results do not support the hypothesis that joining the EU increases convergence, reforms undertaken in the 1990s by Eastern European countries in preparation for joining may have helped them to “catch up”, even if the act of joining the EU did not directly impact convergence.

Keywords: income convergence; European Union; Euro-zone (search for similar items in EconPapers)
JEL-codes: F5 O4 (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link)
http://akademiai.com/content/597631872183107g/fulltext.pdf (application/pdf)
subscription

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aka:aoecon:v:62:y:2012:i:2:p:183-204

Ordering information: This journal article can be ordered from
Akadémiai Kiadó Zrt., P. O. Box 245, H-1519 Budapest, Hungary
https://akjournals.com/
customerservice@akjournals.com

Access Statistics for this article

Acta Oeconomica is currently edited by Mihályi, Péter

More articles in Acta Oeconomica from Akadémiai Kiadó, Hungary
Bibliographic data for series maintained by Kriston, Orsolya (orsolya.kriston@akademiai.hu).

 
Page updated 2022-01-18
Handle: RePEc:aka:aoecon:v:62:y:2012:i:2:p:183-204