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Economic Growth and Development in Central and Eastern Europe after the Transformation

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  • Dombi, Ákos

Abstract

This paper examines the direct sources of economic growth and development in 10 post-socialist Central and East Euro-pean countries in the period from 1995 to 2012. We perform an empirical analysis relying on the methods of growth accounting and development accounting. The results of the growth accounting analysis demonstrate that the most important source of economic growth is the accumulation of physical capital, while the growth of labour productivity and that of multifactor productivity often have marginal effects only. These results are in line with those of development accounting, suggesting that the sluggish growth of the 10 countries compared to Germany in terms of GDP/hours worked can be attributed primarily to the low capital intensity of Central and East European economies, which offered considerable potential for the rapid accumulation of physical capital.

Suggested Citation

  • Dombi, Ákos, 2013. "Economic Growth and Development in Central and Eastern Europe after the Transformation," Public Finance Quarterly, Corvinus University of Budapest, vol. 58(4), pages 452-468.
    • Handle: RePEc:pfq:journl:v:58:y:2013:i:4:p:452-468
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    File URL: https://unipub.lib.uni-corvinus.hu/8943/
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    References listed on IDEAS

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    Cited by:

    1. Giday, András, 2015. "Investment Rate in the Visegrád Group," Public Finance Quarterly, Corvinus University of Budapest, vol. 60(2), pages 171-193.
    2. Monica Pop Silaghi & Diana Alexa, 2015. "Sources of Growth: Evidence from Ten Central and Eastern European Countries during 1993-2008," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 62(5), pages 643-661, December.
    3. Andrii Hrona, 2020. "Foreign Currency Refinancing As A New Element Of Stimulating The Economic Development Of Transition Economies," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 6(5).
    4. Maja Bacovic & Zivko Andrijasevic & Julija Cerovic Smolovic, 2022. "Structural Changes and Growth in Europe: Are Knowledge-intensive Services Changing Paradigm of Expansion of Services as a Long-term Growth-diminishing Factor?," Journal of Economics / Ekonomicky casopis, Institute of Economic Research, Slovak Academy of Sciences, vol. 70(2), pages 124-143, February.

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    More about this item

    Keywords

    growth accounting; development accounting; Central and Eastern Europe;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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