ROMANIA AND BULGARIA AFTER ONE DECADE IN EU – AN ASSESSMENT OF THE ECONOMIC PERFORMANCE
Published: 13 Sep 2016
Abstract: Romania and Bulgaria faced the same economic history after the World War II. Both countries on the bank of Danube struggled in a prolonged transition towards the market economy after 1989, being the laggards in terms of development, European convergence and implementation of the acquis communautaire. After joining the EU in 2007 these economies were surprised in an overheating mood by the Great Recession. There followed a prolonged and severe macro-economic adjustment, with consequences in terms of economic development. This paper employs the Cobb-Douglas methodology and data from Eurostat, IMF and Bloomberg in order to assess the economic performance of Romania and Bulgaria over the past decade. The results show that Romania performed better than Bulgaria after 2007, an evolution determined by several factors, including a better dynamics of the total productivity factor and more flexible labour markets. However, both countries continue at the end of the EU classification in terms of real economic development.
Keywords: potential gdp, economic development, see economies, great recession
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