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Laggards or performers? CEE vs. PIIGS countries’ catch-up with the Euro area in the last ten years

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  • Tatomir, Cristina F.
  • Alexe, Ileana

Abstract

This research paper develops a comparative analysis between the new members states of the European Union (EU) – from Central and Eastern Europe (CEE) – and PIIGS countries (Portugal, Italy, Ireland, Greece and Spain) in terms of economic convergence with the Euro area, in the last decade. In addition, the paper emphasizes the changes in the economic convergence levels determined by the recent international crisis. In order to assess these evolutions, we compute an aggregated index of economic convergence, made up of real and structural convergence indexes. Then, by using cluster methodology, we highlight the similarities between the states in the two groups, CEE and PIIGS, from the economic convergence perspective. The comparative analysis reveals that in 2010 only Estonia, Hungary and Slovenia report resembling characteristics to PIIGS group. We also report an important progress of the countries analyzed, as regards real and structural convergence with the Euro area. However, after a decade of catching-up, Romania remains by far the most distanced country from the Euro area.

Suggested Citation

  • Tatomir, Cristina F. & Alexe, Ileana, 2011. "Laggards or performers? CEE vs. PIIGS countries’ catch-up with the Euro area in the last ten years," MPRA Paper 35715, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:35715
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    References listed on IDEAS

    as
    1. Oded Galor, 1996. "Convergence?: Inferences from Theoretical Models," Working Papers 96-3, Brown University, Department of Economics.
    2. Zsolt Darvas & György Szapáry, 2004. "Business Cycle Synchronisation in the Enlarged EU: Comovements in the New and Old Members," MNB Working Papers 2004/1, Magyar Nemzeti Bank (Central Bank of Hungary).
    3. Elena Bojesteanu & Gabriel Bobeica, 2008. "Where Do the Newest EU Member States Stand on the Road to Monetary Integration?," International Trade and Finance Association Conference Papers 1121, International Trade and Finance Association.
    4. Ignazio Angeloni & Michael Flad & Francesco Paolo Mongelli, 2005. "Economic and monetary integration of the new Member States - helping to chart the route," Occasional Paper Series 36, European Central Bank.
    5. Urmas Varblane & Priit Vahter, 2005. "An Analysis Of The Economic Convergence Process In The Transition Countries," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 37, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    6. Miron, Dumitru & Dima, Alina & Paun, Cristian, 2009. "A model for assessing Romania's real convergence based on distances and clusters methods," MPRA Paper 31410, University Library of Munich, Germany.
    7. Spruk, Rok, 2011. "Productivity and income convergence in transition: theory and evidence from Central Europe," MPRA Paper 33389, University Library of Munich, Germany.
    8. Galor, Oded, 1996. "Convergence? Inferences from Theoretical Models," Economic Journal, Royal Economic Society, vol. 106(437), pages 1056-1069, July.
    9. Angeloni, Ignazio & Flad, Michael & Mongelli, Francesco Paolo, 2005. "Economic and monetary integration of New Member States - helping to chart the route," Occasional Paper Series 36, European Central Bank.
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    Cited by:

    1. Ryszard Rapacki & Mariusz Próchniak, 2014. "The Impact of EU Membership on Economic Growth and Real Convergence of the Central and Eastern European Countries," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 39.

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    More about this item

    Keywords

    real convergence; structural convergence; Central and Eastern Europe; PIIGS; clusterization;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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