Is the European Union still a convergence machine

Bibliographic Data

ID21281884
AuthorsSándor Gyula Nagy (0000-0003-2374-702X, Corvinus University of Budapest), Dženita Šiljak (0000-0003-0149-4324, International University of Sarajevo)
Year2022
Volume72
Issue1
Pages47-63
Publication date2022-03-25
Open AccessYes
TypeARTICLE
VenueActa Oeconomica (JOURNAL)
Journal identifiersISSN: 0001-6373 • E-ISSN: 1588-2659
PublisherAkademiai Kiado Zrt. (PUBLISHER • HU)
DOI10.1556/032.2022.00003
OpenAlexW4221005692
LanguageEN
Citations received5
References cited26

We investigate whether the European Union can be considered as a convergence machine after the 2008/2009 financial crisis. To do so, we econometrically test the relationship between the per capita GDP growth rate and macroeconomic variables in the period of 2004–2018, further subdivided into three periods: 2004–2008, 2009–2013 and 2014–2018. We hypothesize that the 2008/2009 financial crisis had a negative effect on the σ and β-convergence process. Our results support the convergence hypothesis, namely that the poor countries tend to grow faster than the rich countries. The convergence rates ranged between 1.71% and 4.51%. The negative effects of the crisis on convergence have been identified only for the absolute convergence. Our findings demonstrate that economic openness, inflation and government integrity have a positive impact on growth. The effects of unemployment have not been identified

Convergence (economics) · Economics · European union · Financial crisis · Inflation (cosmology) · International economics · Macroeconomics · Monetary economics · Openness to experience · Per capita · Unemployment · Economic Growth and Productivity · Fiscal Policy and Economic Growth · Regional Development and Policy

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