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Convergence analysis of household expenditures using the absolute β-convergence method

Author

Listed:
  • Domazet Anto

    (Department of Marketing, School of Economics and Business, Sarajevo, Bosnia and Herzegovina)

  • Sendić Rusmir

    (Department of Marketing, School of Economics and Business, Sarajevo, Bosnia and Herzegovina)

  • Alić Adi

    (Department of Marketing, School of Economics and Business, Sarajevo, Bosnia and Herzegovina)

Abstract

Background: The paper examines the convergence of household expenditures, in terms of a possible usage of the standardized, rather than consumer-tailored marketing, mainly on a regional level. Objectives: The main goal of this research is to study the existence of consumption expenditure convergence in the EU-27 countries, in the period between 2000 and 2007. Methods/Approach: The analysis used the absolute β-convergence method, in order to investigate the existence of a negative correlation between the growth over time in the overall consumption expenditure in EU member-countries for each individual product and service category and the initial expenditure level. Results: According to the obtained results, in the period between 2000 and 2007, the EU-27 countries reached a high level of consumer expenditure convergence, which provides a basis for developing a regional concept of the standardized international marketing for these countries' markets. Conclusions: The results provide an empirical contribution to claims on consumer convergence in the countries included into economic integrations. Also, the obtained results can be used to create a basis for defining and applying the regional marketing concept for companies focusing on the EU-27 countries' market.

Suggested Citation

  • Domazet Anto & Sendić Rusmir & Alić Adi, 2012. "Convergence analysis of household expenditures using the absolute β-convergence method," Business Systems Research, Sciendo, vol. 3(1), pages 23-29, June.
    • Handle: RePEc:bit:bsrysr:v:3:y:2012:i:1:p:23-29
    DOI: 10.2478/v10305-012-0003-3
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    References listed on IDEAS

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    1. De Simone, Elina & Gaeta, Giuseppe Lucio & Ercolano, Salvatore, 2010. "Exploring Convergence in some OECD Public Social Expenditure Trends," MPRA Paper 22496, University Library of Munich, Germany.
    2. John Nixon, "undated". "Convergence Analysis of Health Care Expenditure in the EU Countries Using Two Approaches," Discussion Papers 99/3, Department of Economics, University of York.
    3. G. E. Boyle & T. G. McCARTHY, 1999. "Simple measures of convergence in per capita GDP: a note on some further international evidence," Applied Economics Letters, Taylor & Francis Journals, vol. 6(6), pages 343-347.
    4. Regmi, Anita & Unnevehr, Laurian J., 2005. "Convergence or Divergence in Food Demand: Comparison of Trends in the EU and North America," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24687, European Association of Agricultural Economists.
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