Income Convergence in the EU: A tale of two speeds

Cinzia Alcidi, Jorge Núñez Ferrer, Mattia Di Salvo, Roberto Musmeci and Marta Pilati.

Economic convergence refers to the process in which relatively poorer countries (or regions) grow faster than relatively richer ones, thereby allowing the former to catch up with the latter.In the EU context, convergence has always been considered the fundamental economic mechanism and precondition for achieving socio-economic cohesion. The latter is an explicit objective of the EU, as formulated in Article 130a of the Single European Act (1986): “[I]n order to promote its overall harmonious development, the Community shall develop and pursue its actions leading to the strengthening of its economic and social cohesion”. This passage constitutes the legal ground for the creation of the European Structural Funds as well as the backbone of EU Cohesion Policy. Both Structural Funds and cohesion policy were intended to act against regional disparities, on the one hand by devising redistributive measures, on the other hand by equipping poorer regions with the tools to improve their potential growth (and hence their productivity). The rationale was that the creation of the internal market and its four freedoms (free movement of people, goods and capital and of establishing and providing services) would lead to cross-border relocation of resources and productive activities and some countries and regions would be negatively affected.

Πηγή: CEPS

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