Economic Growth, Convergence And Eu Membership: Empirical Evidence From Croatia

The aim of this paper is to get new knowledge about economic growth and real convergence of the Republic of Croatia towards countries of the European Union. Besides the regression analysis, indicators of international trade were used in the research. The macroeconomic convergence process was tested using the Theil index. The research was conducted for the following variables: GDP per capita, nominal gross wage, unemployment rate and public debt. The results obtained confirmed the different direction and dynamics of movement between individual variables, but also during the observed period. Until 2008, the convergence process is confirmed in variables: GDP per capita, nominal gross wage, and unemployment rate. After 2008, the process of divergence, i.e. the increase of the economic gap between Croatia and the new EU-28 members is noticed. This is particularly highlighted in the direction and pace of GDP per capita trend. The convergence analysis in the field of export competitiveness and trade specialization shows Croatia’s lagging behind in export competitiveness compared to new EU members. Measured by exports of goods per capita, Croatia realizes several times smaller exports than the Czech Republic, Slovakia, Slovenia, Estonia and Hungary. Defining and realizing a new model of economic growth based on the growth of investments and high-technology export is a prerequisite for realization of stronger economic growth, long-term stability and sustainability of public finances and achievement of a welfare economy.