Sustainable Growth: Recent Trends Across Central And Eastern European Economies

What is economic growth? Although the answer to this question may seems of real simplicity, developing an accurate definition of this concept may constitute a real challenge both from a theoretical but also empirical point of view. This constant debate upon the concept of economic growth as well as indentifying the optimum set of instruments for quantifying it, constituted the starting point of the current article. The concept of economic growth is used nowadays complementary to terms like economic development, economic welfare or economic progress with reference to this complex process that implies macro-scale structures. Moreover indentifying the main factors that generate a significant impact upon the dynamics of the economic growth process, constitute a useful approach taking into consideration the high degree of heterogeneity that characterize the architecture of the economies around the world. If we develop this analysis across the European Union member states this debate became even more challenging due to the high degree of diversity that characterize these economies. Moreover, the Central and Eastern European countries and especially the ones that joined EU in 2004 and 2007 embody a set of particularities that make them extremely different from the rest of the European Union member states, features related to the historical background, economic policies and common efforts to intensify the convergence process with the more developed EU members. This paper studies the impact of two main factors upon the economic growth process namely an endogenous-exogenous factor like the degree of openness and an endogenous factor like the human capital using a complex dynamic panel method. The arguments that were in favour of choosing this two factors are on one hand the multitude of theoretical studies that argued the importance of them in modelling the economic growth process and on the other hand the small number of studies that use panel methods in assessing this impact. The obtained results point towards a positive correlation between degree of openness, human capital and economic growth across Central and Eastern European countries. These results may be used by the responsible authorities as a basis for the development of the future strategies concerning economic growth. The ability of the new member states to adapt to the macroeconomic changes will prove to be vital in the context of the global architecture and will constitute a vital indicator of the economic growth and performance level of these economies.