Un-sustainable development goals as a new dimension of the EMU Core-Periphery dualism

Despite widespread recognition of the importance of the issue, economic literature to the best of our knowledge has neglected the role of the Sustainable Development Goals (SDGs) in the persistent core periphery dualism in European Monetary Union (EMU). This gap is peculiar since starting from 2015 (and even before with the Millennium goals and the OECD DAC International Development Goals) the European Union (EU) has shaped its economic policies in order to reach the 17 SDGs by 2030. In this paper we intend to fill this gap. We contribute to the empirical literature in two ways i) assessing whether the SDGs might represent themselves a new dimension of EMU core periphery dualism and ii) whether the similarity of SDGs scores for EMU country pairs have been affecting the existing dualism. The cluster analysis performed evidenced that there was a Core-Periphery pattern for SDGs scores in the period 2001-2021 for 12 EMU countries, although the distance between and within the two groups diminished overtime. Moreover, panel estimates for the period 2003-2019 evidenced that there was a relationship between SDGs scores similarity and business cycle synchronization for the selected EMU countries. According to our estimates, it seems that having a similar pattern to reach the SDGs displayed a differentiated impact on core and periphery countries. Moreover, disentangling the SDGs similarity index in its three main components (the 3Ps) evidenced heterogeneous and even opposite relationships with business cycle correlation.