EU's Eastern Neighbours: Institutional Harmonisation and Potential Growth Bonus

Artur Radziwill () and Pawel Smietanka

No 386, CASE Network Studies and Analyses from CASE-Center for Social and Economic Research

Abstract: This paper provides the quantitative estimate of the potential growth bonus for CIS countries, and in particular EU's Easter Neighbours, that can be a result of deeper institutional harmonisation with the EU. Econometric investigation involving instrumental variable, simultaneous equation and dynamic panel techniques documents the strong positive link between growth performance and reforms, as well as between reforms and European integration. The paper derives the range of possible values of growth bonus from the deepened neighbourhood cooperation between 1 and 3.8 with the median at 1.8 percentage points. The least growth bonus is expected through basic liberalization reforms, while countries with a considerable institutional gap are likely to gain the most.

Keywords: institutions; reform; growth; transition; integration; neighbourhood; dynamic panel (search for similar items in EconPapers)
JEL-codes: F59 O19 O49 O57 P21 P26 P27 (search for similar items in EconPapers)
Pages: 40 Pages
Date: 2009
New Economics Papers: this item is included in nep-tra
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:sec:cnstan:0386

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