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Disintegration scenarios in the European Union: A case study of Eastern European economies

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  • Bolea, Lucía
  • Duarte, Rosa
  • Hewings, Geoffrey J.D.
  • Sánchez-Chóliz, Julio

Abstract

This paper examines the progress of countries’ integration within the EU, and the expansion to include many Eastern European countries in this phenomenon. We create a multisectoral and multiregional input-output model (MRIO) to study a group of “counterfactuals” to evaluate the economic integration/disintegration phenomenon in this context. As an initial experiment, we conduct a study of the “non-integration” of Eastern European countries. On the basis of the MRIO model and, inspired by the synthetic indicators methodology and hypothetical extraction methods, we first study the trends in their trade relationships and technological and structural composition. Second, we design hypothetical scenarios based on the behavior observed in these trends to analyze the contribution of the disintegration process to economic growth and structural specialization. We find that Eastern Europe is highly vulnerable to the effects of trade with other European countries; the impact of a possible exit of Eastern countries would be almost three times greater for those countries than for the rest of Europe.

Suggested Citation

  • Bolea, Lucía & Duarte, Rosa & Hewings, Geoffrey J.D. & Sánchez-Chóliz, Julio, 2021. "Disintegration scenarios in the European Union: A case study of Eastern European economies," Economic Modelling, Elsevier, vol. 95(C), pages 1-12.
    • Handle: RePEc:eee:ecmode:v:95:y:2021:i:c:p:1-12
    DOI: 10.1016/j.econmod.2020.11.015
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    2. Cottafava, Dario & Gastaldo, Michele & Quatraro, Francesco & Santhiá, Cristina, 2022. "Modeling economic losses and greenhouse gas emissions reduction during the COVID-19 pandemic: Past, present, and future scenarios for Italy," Economic Modelling, Elsevier, vol. 110(C).

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    More about this item

    Keywords

    Multiregional input-output model; Hypothetical extraction method; Economic growth; European Union; Eastern European countries; Economic integration;
    All these keywords.

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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