The Evaluation of an Economic Distance Among Countries: A Novel Approach

Jiri Mazurek

Prague Economic Papers, 2012, vol. 2012, issue 3, 277-290

Abstract: The aim of the article is to propose a new measure of a relative economic distance between two countries (RED) or among a group of countries (GRED). Both measures enable to evaluate 'proximity' between national economies through time series of selected variables, and are related to the concept of the sigma (beta) convergence introduced by Barro and Sala-i Martin (1995). In the empirical part of the paper, the RED of Poland, Slovakia, Austria, Germany, the USA and Japan with regard to the Czech Republic are estimated, as well as the time evolution of the GRED of the Czech Republic and its neighbours. The main finding is the strong convergence among these countries after the outbreak of the financial crisis which persists to this day.

Keywords: unemployment; correlation; GDP; relative economic distance; the Czech Republic (search for similar items in EconPapers)
JEL-codes: C19 F50 O57 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (4)

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DOI: 10.18267/j.pep.424

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