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Economic growth and customs unions: An empirical investigation

Author

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  • Parousis Evaggelos

    (South-West University “Neofit Rilsky”, Blagoevgrad, Faculty of Economics)

Abstract

A significant area of research in macroeconomics is devoted to understanding how customs unions affect the economies of the participating countries. This paper examines the effects of the EU Customs Union on Greece’s economic growth and development. We employ advanced econometric methodologies to investigate the stationarity properties of the variables, examine the existence of a long-run causal relationship among the variables within the cointegration framework, and study possible short-run causal effects. The empirical results confirm a cointegrating relationship which suggests that long-run causal effects exist among the selected variables of our model. Investment in physical capital and the number of workers are statistically significant, while the magnitude of the number of workers is far greater than that of investment in physical capital. We also construct and employ a suitable time dummy variable that is statistically significant and indicates that Greek income has been negatively impacted by the accession of the country to the EU. Further investigation shows that a long-run asymmetric relationship does not exist.

Suggested Citation

  • Parousis Evaggelos, 2025. "Economic growth and customs unions: An empirical investigation," Entrepreneurship, Faculty of Economics, SOUTH-WEST UNIVERSITY "NEOFIT RILSKI", BLAGOEVGRAD, vol. 13(1), pages 42-52.
    • Handle: RePEc:neo:epjour:v:13:y:2025:i:1:p:42-52
    DOI: 10.37708/ep.swu.v13i1.4
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    More about this item

    Keywords

    Economic Growth; Customs Union; Time-series; Cointegration;
    All these keywords.

    JEL classification:

    • B17 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - International Trade and Finance
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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