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Regional growth and convergence via integration – the case of the large EU

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  • Paavo Okko

Abstract

The coming Eastern enlargement of the EU will be a fundamentally different step in the history of the European integration. It will create a new situation in which growth conditions and regional adjustment requirements of Europe are going to change, too. The theory of economic growth and regional structures has developed recently in an interesting way. Especially the endogenous growth theory and models of the new economic geography offer relevant approach for interpretations. There is a strong tendency towards factor price equalisation and towards income convergence. But regional differences in other respects may become even larger via this process. The enlargement of the EU is an interesting case from this point of view. There are very large income differences, which are assumed to diminish, but it seems impossible to happen without a fundamental regional restructuring. The target of the paper is to make a survey on the growth theory and regional restructuring literature from the point of view of European integration. The idea is to make an evaluation and prediction on the real convergence prospects of the large EU. Eastern enlargement is an opportunity to faster growth in Europe, but the regional specialization and restructuring is a crucial condition for materializing of this result.

Suggested Citation

  • Paavo Okko, 2003. "Regional growth and convergence via integration – the case of the large EU," ERSA conference papers ersa03p445, European Regional Science Association.
    • Handle: RePEc:wiw:wiwrsa:ersa03p445
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