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This paper presents the analysis of unconditional and convergence among the ten European countries that accessed the European Union in 2004. Unconditional convergence means that the less developed countries (with lower GDP per capita) grow faster than the more developed countries (with higher GDP per capita). convergence exists when income differen...
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... Despite the same starting point, there is a controversy regarding the application of the two convergence concepts, arising from different focuses on the convergence processes' aspects. Hence, Vojinović & Oplotnik (2008) point out that the concept of β-convergence has been more frequently used by macroeconomists, while σconvergence has been more popular in literature on economic geography and regional science. It is most usually applied to evaluate dispersion of per capita income in time, across different economies and assumes that economies are converging if the dispersion of their real per capita income has the decreasing tendency. ...
The main objective of this paper is to determine whether tourism contributes to the economic convergence in the EU member states. The starting point of the analysis is the theoretical concepts of σ-convergence and (conditional) β-convergence. For the purpose of examining the relationship between tourism and σ-convergence in the long and short term, the cointegration test is used. Additionally, panel analysis is used for testing the model of conditional convergence. In this model, tourism as a conditional factor is operationalised by monetary indicators (consumption components and capital investments) as well as by a non-monetary one (direct employment) based on the tourism satellite account methodological framework. The model also tests a range of economic, social and ecological impacts on tourism and the economic convergence. The results proved that, although there is a long-term and short-term relationship between tourism and the economic growth convergence, tourism does not contribute to the economic convergence in the European Union member states, at least not to the extent that was expected.
... The related concept to the growth effects of European integration is the income convergence debate in the context of European integration which received attention following the expansion of the European Union in 2004. The studies by Vojinović and Oplotnik (2008), Vojinović et al. (2009Vojinović et al. ( , 2010 and Próchniak and Witkowski (2013) find income convergence among the new EU member states and between the CEE-8 and the EU-15, with slight differences in the estimated speed of convergence. On the other hand, Allington and McCombie (2007) estimate a relatively poor convergence for the members located at the EU periphery both amongst themselves and in clubs with the old EU countries. ...
In this paper, we study the growth effects of the 2004 Eastern enlargement of the European Union (EU) using the synthetic control method. We estimate that this EU enlargement had an immediate but modest positive impact on the economic growth of the EU-8 countries in the first few years following their EU accession. The positive impact of the EU enlargement became more apparent from 2007 when the new EU member states were admitted into the Schengen zone. As a result, the gross domestic product (GDP) per capita difference between the actual and synthetic EU-8 continued to grow towards the end of the sample period. We found that over the entire 2004–2012 period, GDP per capita of the EU-8 was increased by about 2313 USD per year on average relative to the synthetic EU-8. The growth rate of the GDP per capita in the actual EU-8 for the same period was 2.7% larger than the synthetic EU-8.
... According to our knowledge, there is hardly any empirical study that investigates the problem of economic convergence within the CESEE region, or more precisely between non-EU CESEE and EU CESEE countries. The following few studies, although not directly related, were helpful in providing this investigation an added perspective: Vojinović and Oplotnik (2008) examined the existence of absolute and -convergence among the 10 Central and Eastern European (CEE) countries that accessed the EU in 2004. Their results suggested that poorer CEE countries generally grew faster than richer ones (with a magnitude of 2.9% in the period 1995-2006 and 3.2% in 1996-2006) and that the income gap, although still quite large, had a tendency to decrease. ...
The existing empirical literature on economic convergence and growth emphasizes the importance of foreign capital inflows for the Central, Eastern, and Southeastern European (CESEE) countries. This paper challenges such arguments by stating that not all forms of foreign capital inflows are beneficial for the economic growth of CESEE countries. Our results suggest that remittances (as an alternative foreign capital inflow) tend to slow down economic growth. Moreover, apart from the prevailing trends to investigate the economic convergence of CESEE towards Western European countries, this paper focuses on economic convergence within the CESEE region, that is, on economic convergence of the non-EU CESEE countries towards EU CESEE countries. We found that, in the last two decades, the living standard in the CESEE region has become increasingly equal. There is a tendency for poorer non-EU CESEE countries to grow faster than richer EU CESEE countries, which confirms the existence of absolute \beta\-convergence. We have also found that each CESEE country converges 2.8% closer to its own steady state, in the sense of conditional \beta\, every year.
... What is more, the convergence of the CEE countries toward EU15 is obvious in most cases. Convergence within CEE and WE countries was detected by Verblane and Vahter (2005), Matkowski and Próchniak (2006), Vojinovic and Oplotnik (2008) confirms the presence of both beta and sigma convergence among 8 CEE and 15 WE countries during the years 1990s and early 2000s. Stanišić (2012) found that poorer "new" members (CEE10) grew faster than richer "old" members (EU15) and as a result the relative per-capita income gap between these has narrowed. ...
The aim of the article is to verify the convergence process of the Central and Eastern Europe (CEE) (CEE10) countries towards Western European countries (EU15) in years 1995–2016. Additionally, the paper aims to show the interaction between economic integration and convergence as well as business environment and growth. The study methods applied in in the article are analysis of the literature and wide range of quantitative methods (descriptive statistics. regression models (OLS and panel), the elements of taxonomic analysis (cluster analysis and Clark’s coefficient of divergence). In the study years, CEE10 and EU15 countries were developing in accordance with the convergence hypothesis. The impact of economic integration on convergence was confirmed as well as the dependence of growth from the business environment in EU10. The added value of the study is the combination of three important research problems: convergence, economic integration and business environment. In addition, the research area concerns the CEE countries, which is very desirable. Many prior studies suggested to elaborate development and business processes in emerging countries like CEE. Thus, the article tries to fulfill this research needs. It has not only cognitive but also utilitarian values. The research results can be taken into consideration by policy makers to create an appropriate development policy and a conducive business environment.
... Convergence is well documented for EU15, and membership in the customs union proved to be an important factor, although this is not an automatic outcome. Consequently, ever since the enlargement of the EU in 2004, many researchers have covered the new member states (NMS), prominently the Central Eastern European (CEE) countries, in the convergence debate (Kaitila, 2004;Varblane & Vahter, 2005;Prochniak, 2008;Vojinović & Oplotnik, 2008;Vojinović et al., 2010). The literature generally reports that the catching-up process is sensitive to both the study period and the chosen cluster of countries. ...
This article estimates the duration model with censored data to establish the determinants of the length of time it takes to set up a new business, as duration event analysis naturally lends itself to a study of the time elapsed between starting and finishing the constitution of a new firm. We assume that the number of various procedures linked to establishing a new business, cost, economic development, as well as monetary and business tourism, are important determinants of the length of time. This paper studies the length of time spent in starting up business with a new firm, and the determinant impact on it across numerous countries in Europe between 2003 and 2014.
... The EU enlargement "to the East" in the first decade of this century has contributed to a significant increase in the number of the studies testing the theorem on the convergence of the GDP per capita. In a number of works (Matkowski & Próchniak, 2004;Kutan & Yigit, 2004;Kutan & Yigit, 2005;Varblane & Vahter, 2005;Próchniak, 2008;Vojinovic & Oplotnik, 2008;Vojinovic, Acharya & Próchniak, 2009;Cavenaile & Dubois, 2011), the authors came to the conclusion that the patterns of the economic growth of the new member states (NMS) in the 1990s and the first decade of the 21st century were in accordance with the income convergence theorem. ...
... Later studies (Próchniak, 2008;Vojinovic & Oplotnik, 2008;Vojinovic, Acharya & Próchniak, 2009) also confirm the income convergence of the CEE8 and the EU-15, and the results only differ in the estimated speed of such convergence. L. Cavenaile and D. Dubois (2011) examined the process of income convergence between the ten new member states (NMS) and the EU-15 in the period between 1990 and 2007. ...
... I kasnije studije (Prochniak, 2008;Vojinovic & Oplotnik, 2008;Vojinovic, Acharya & Prochniak, 2009) potvrđuju konvergenciju dohodaka CEE8 i EU15, a rezulteti se razlikuju samo u procenjenoj brzini konvergencije. L. Cavenaile i D. Dubois (2011) su ispitivali proces dohodovne konvergencije između deset novih članica EU (NMS) i EU15 u periodu 1990-2007. ...
One of the main expectations in European transition economies is that the processes of building the market economy and European integrations lead to a significant increase in the living standard, as well as to catching up with the level of the income per capita achieved in developed European economies. A quarter century after the beginning of transition, many of the former socialist countries joined the EU and significantly increased their GDP per capita. On the other hand, transition in the countries of the so-called Western Balkans has disappointed in this sense. The paper tests the existence and speed of income convergence in the Western Balkan states and developed EU countries, in comparison with the so-called „New Member States”. The results indicate that, despite the achieved income convergence in the pre-crisis years, the outbreak of the global economic crisis has revealed many structural and reform problems that the countries of the region have been facing for a long time. Catching up with developed EU members’ average GDP per capita stopped in the Western Balkan states after the beginning of the crisis, with a simultaneous increase in the income gap between the Western Balkan states and the new EU member states.
... Convergence is well documented for EU15, and membership in the customs union proved to be an important factor, though this is not an automatic outcome. Consequently, ever since the enlargement of the EU in 2004, many researchers covered the new member states (NMS), prominently the Central Eastern European (CEE) countries, in the convergence debate (Kaitila, 2004;Varblane & Vahter, 2005;Prochniak, 2008;Vojinović & Oplotnik, 2008;Vojinović et al., 2010). The literature generally reports that the catching-up process is sensitive to both the study period and the chosen cluster of countries. ...
The paper tests the hypothesis that developing member states of the European Union converge to richer countries. On the basis of a Cobb-Douglas production function this study estimates beta convergence, and sigma convergence, utilising data from the 28 EU member countries. The results confirm the hypothesis and indicate that poor countries grow faster than rich economies in terms of per capita income and the convergence process for Malta is slower. This finding has important implications for transition EU member states, including that Malta needs to overcome several constraints in the transitional phase to increase the steady state level.
... Hančlová et al, (2010); method of real convergence (see e.g. Vojinovic, Oplotnik, (2008), Dvoroková, Kovářová, Šulgánová (2011)); modified territorial Gini coefficient or method of artificial neuron nets (e.g. (Kutscherauer, (2010), Tvrdoň, Skokan, (2011)). ...
... However, countries have been quite heterogeneous regarding their speed and pattern of convergence in Europe. Therefore, in previous papers on the subject of convergence between European countries the results are mixed, depending on the chosen period, sample, and methodology used (see e.g., Matkowski and Próchniak, 2007, Reza and Zahra, 2008, Costantini and Lupi, 2005, Cavenaile and Dubois, 2011, Ingianni and Žďárek, 2009, Kočenda et al., 2006, Vamvakidis, 2008, Vojinović and Oplotnik, 2008, Tatomir and Alexe, 2012, Varblane and Vahter, 2005, Halmai and Vásáry, 2010, Crafts and Toniolo, 2008, Estrin et al., 2001, Czasonis and Quinn, 2012. Therefore, since EU members and candidates constantly strive for higher income, the path and dynamic of income growth relative to other countries is an important question. ...
... They concluded that the integration process of the new EU member states was successful, that the convergence rate was approximately 2.5%, that it would fall by half in the next decade, and that in the future these countries could even record divergence. Vojinović and Oplotnik (2008) observed unconditional beta and sigma convergence among the EU-10. The results obtained through empirical analysis are very similar to the results of other analyses on the same subject. ...
This paper explores income convergence in European countries. Unlike previous research, the analysis is based on the pair-wise approach (Pesaran, 2007), identifying four cases: long-run convergence, catching-up, lagging-behind, and divergence. The results suggest that catching-up prevails, while no significant evidence was found for the existence of long-run convergence at the whole sample level. Still, three convergence clubs appear that consist of countries recording long-run convergence, two in transitional countries and one involving advanced countries, which indicate the similar growth model of the countries belonging to each club. Nevertheless, the results do not allow us to claim with certainty that the income paths of the club members will not exhibit systematic tendencies toward divergence or changes in membership in future.
... EU-27 average is denoted with 100, and it is calculated retroactively for the whole period 1995-2004 such that includes average of all 27 current Member States, although some of them were not members of the EU in that time.11 For more details on real convergence in the EU see for instanceVojinović and Oplotnik (2008),Halmai and Vásáry (2010),Kulhánek (2012) and European Commission (2009:33-34).12 Growth trend in this case means a slope (regression coefficient) of a linear regression line of a specific country. ...
Upon accession to the European Union, the New Member State’s budget undergoes significant structural changes due to the appearance of new categories of revenues and expenditures. The aim of this paper is to estimate the possible effects of Croatian membership in the EU on changes in the structure and size of budget revenues and expenditures upon the country’s accession to the EU in the second half of 2013, as well as to indicate the possibilities for utilization of EU funds in the new financial perspective up to 2020. It is shown that in 2013 Croatia might realize a positive net financial position in transactions with the EU budget in the amount of approximately 0.28% of GDP, i.e. EUR 136 m. The total net financial position of Croatia due to EU accession, which includes some additional costs and benefits like different harmonization and the need for project co-financing at state and local levels, is also positive in 2013 and amounts to approximately 0.15% of GDP or equivalently EUR 72 m. Total amount of all funds that Croatia might receive in the new EU financial perspective covering the period from 2014 to 2020 amounts to EUR 6.34 bn, whereby annual amounts increase from EUR 0.7 bn in 2014 up to EUR 1.2 bn in 2020. By using exponential regression analysis it is estimated that in 2020 Croatia should be a net recipient of funds from the EU budget in total amount of 1.72% of GDP, i.e. EUR 1.13 bn.
