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Drivers Of Long-Term Convergence. Focus On Romania

Author

Listed:
  • Manuela Unguru

    (Institute for World Economy Department New Drivers of Economic Development, Bucharest, Romania)

  • Razvan Voinescu

    (Institute for World Economy Department New Drivers of Economic Development, Bucharest, Romania)

Abstract

With initial low levels of income per capita, a declining population and relatively modest economic growth rates, there are little prospects of diminishing the gap between Romania and the EU countries. Nevertheless, in the long term, convergence is expected. The question then arises, “What are the drivers and their likely potential to boost economic growth and the catching-up process?”. This paper presents shortly the theoretical background of economic convergence and then focuses on the assessment of possible paths of Romania’s convergence towards the EU. Based on the existing long-term macroeconomic projections and the assessment of the possible future developments of the drivers of economic growth, we have built three scenarios of economic convergence, highlighting the possible timespan of convergence. We have employed growth accounting methods to decompose output growth rate into production factors’ contributions (capital and labour) and total factor productivity.

Suggested Citation

  • Manuela Unguru & Razvan Voinescu, 2014. "Drivers Of Long-Term Convergence. Focus On Romania," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 2(2), pages 103-112, November.
    • Handle: RePEc:ntu:ntugeo:vol2-iss2-14-103
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    References listed on IDEAS

    as
    1. Rumen Dobrinsky & Peter Havlik, 2014. "Economic Convergence and Structural Change: the Role of Transition and EU Accession," wiiw Research Reports 395, The Vienna Institute for International Economic Studies, wiiw.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    economic growth; long term projections; technological change; beta convergence; sigma convergence;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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