Economic Growth and European Integration: a Counterfactual Analysis
Abstract: We estimate the growth and productivity effects from becoming a member of the European Union (EU). We simulate time series of hypothetical economic growth and productivity trajectories, which show how these would have developed if the countries that became EU members in the 1973, 1980s, 1995 and 2004 enlargements had not joined the EU. Using this model, we identify large positive effects from EU membership. These effects differ across countries and over time, but are negative in only one case (Greece.) We calculate that without European integration, per capita incomes would have been, on average, approximately 10 percent lower today.
