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CASE Network Studies and Analyses No. 408:
Knowledge-based Entreprenuership in Poland    

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Does the Crisis Experience Call for a New Paradigm in Monetary Policy?

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Prospects for Future Euro‐Mediterranean Trade

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Oil Money vs. Economic Crisis: The Case of Azerbaijan 

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Challenges and Trajectories of Fiscal Policy and PFM Reform in CEE/CIS 

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Mergers and Acquisitions - The Standing of theory in the Quest for Better Institutions and Policy   

CASE Network Report 91:Pension Reform Options for Russia and Ukraine: A Critical Analysis of Available Options and Their Expected Outcomes

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CASE Network E-Brief 03/2010: The price of delay: the future of Russian and Ukrainian pension systems

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Tax wedge, labor market and the shadow economy

CASE Networks Studies and Analyses No. 400:
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CASE Network Studies and Analyses No. 399:
Agriculture Income Assessment for the Purpose of Social Assistance: the Case of Ukraine    

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The global recession and energy markets

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Social Security, Labour Market and Restructuring: Current Situation and Expected Outcomes of Reforms

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From fiscal stimulus to fiscal crisis

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Social Security Driven Tax Wedge and Its Effects On Employment and Shadow Employment

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Restructuring and Social Safety Nets in Russia and Ukraine - Socail Security Influence on Labor Mobility: Possible Opportunities and Challenges

CASE Network Report No. 89:
Economic Integration in the Euro-Mediterranean Region

CASE Network Studies and Analyses No. 396:
Energy security, poverty and vulnerability in Central Asia and the wider European neighborhood

CASE Network Studies and Analyses No. 395:
The East European financial crisis

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No, the central banks didn't do it

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Deep Integrations with the EU and its Likely Impact on Selected ENP countries and Russia

PEO 3/2009
Large Fiscal Deficit in Poland - curse #1

CASE Network Studies and Analyses No. 394
Differentiation of Innovation Behavior of Manufacturing Firms in the New Member States. Cluster Analysis on Firm-Level Data




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Last update
2010-09-02


CASE Network Studies and Analyses
No. 379   East-West Integration and the Economic Geography of Europe
Author: Arne Melchior
Series: CASE Network Studies and Analyses
Year of issue: 2009
Project: ENEPO: EU Eastern Neighbourhood - Economic Potential and Future Development

Abstract

Implementation of the European internal market and East-West integration has been accompanied by dramatic change in the spatial distribution of economic activity, with higher growth west and east of a longitude degree through Germany and Italy. In the east, income growth has been accompanied by increasing regional disparities within countries. We examine theoretically and empirically whether European integration as such can explain these developments. Using a numerical simulation model with 9 countries and 90 regions, theoretical predictions are derived about how various patterns of integration may affect the income distribution. Comparing with reality, we find that a reduction in distance-related trade costs combined with east-west integration is best able to explain the actual changes in Europe's economic geography. This suggests that the implementation of the European internal market or the Euro has "made Europe smaller". In Central Europe, capital regions grow faster and there are few east-west growth differences inside countries. There is no convincing support for the hypothesis that European integration had adverse effects on non-members.

Keywords: Income distribution, regional inequality, economic growth and convergence, European integration
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