Towards a New Growth Model in CESEE: Three Challenges Ahead

Luca Gattini, Áron Gereben, Miroslav Kollár (), Debora Revoltella () and Patricia Wruuck ()
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Miroslav Kollár: European Investment Bank (EIB)
Debora Revoltella: European Investment Bank (EIB)
Patricia Wruuck: European Investment Bank (EIB)

Chapter Chapter 3 in Does EU Membership Facilitate Convergence? The Experience of the EU's Eastern Enlargement - Volume I, 2021, pp 91-122 from Palgrave Macmillan

Abstract: Abstract We revisit the factors of convergence and growth in Central, Eastern and South Eastern Europe (CESEE). While the key elements that were driving pre-crisis convergence – rapid export growth, propelled by low wages, capital inflows and technology import, and catalysed by the EU accession – gave a strong impetus to economic progress, these factors have been weakened after the crisis due to changes in the labour market, demographics and slowdown of capital inflows. As a consequence, potential growth in CESEE economies decelerated. To maintain an adequate speed of convergence, a prospective “new growth model” is emerging as a candidate to be the driving force of growth in CESEE. The key elements of this growth model should be based on home-grown innovation to increase productivity, policies supporting the preservation and development of the productive labour force, and a system of financial intermediation that supports domestic savings.

Keywords: Economic growth; Innovation; Labour market; Financial intermediation (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:pal:stuchp:978-3-030-57686-8_3

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DOI: 10.1007/978-3-030-57686-8_3

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