Balassa-Samuelson Effect in 10 CEE Countries: Does Productivity Influence their Price Convergence to EU15?

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F61989100%3A27510%2F18%3A10239851" target="_blank" >RIV/61989100:27510/18:10239851 - isvavai.cz</a>
Result on the web
<a href="https://www.ekf.vsb.cz/export/sites/ekf/icei/.content/galerie-dokumentu/ICEI-2018_Proceedings.pdf" target="_blank" >https://www.ekf.vsb.cz/export/sites/ekf/icei/.content/galerie-dokumentu/ICEI-2018_Proceedings.pdf</a>
DOI - Digital Object Identifier
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Result language
angličtina
Original language name
Balassa-Samuelson Effect in 10 CEE Countries: Does Productivity Influence their Price Convergence to EU15?
Original language description
This paper deals with Balassa-Samuelson (BS) effect in Central and East European (CEE) countries. This theory claims that higher growth of productivity in tradable sector leads to growth of prices in non-tradable one. Lately, we can see price convergence between former members of European Union (EU15) and new members of European Union (CEE countries). BS effect is one of possible explanations of this fact. The aim of this paper is to estimate this effect in 10 CEE countries. We try to investigate whether growth of productivity in CEE countries leads to their price convergence to EU15 or not. We use OLS regression in 1995Q2- 2017Q1 periods. We find out that BS effect is important in most of CEE countries. Unlike other studies, some traditional assumptions of this theory are tested in this one. We find out that (i) PPP theory is not valid in CEE countries and that (ii) wages in tradable and non-tradeable sectors tend to be equalized. Therefore, the estimated model is corrected according to these conditions.
Czech name
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Czech description
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Publication year
2018
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Article name in the collection
Proceedings of the 4th International Conference on European Integration 2018 : ICEI 2018 : May 17-18, 2018, Ostrava, Czech Republic. 1st part
ISBN
978-80-248-4169-4
ISSN
2571-029X
e-ISSN
neuvedeno
Number of pages
9
Pages from-to
41-49
Publisher name
VŠB - Technical University of Ostrava
Place of publication
Ostrava
Event location
Ostrava
Event date
May 17, 2018
Type of event by nationality
EUR - Evropská akce
UT code for WoS article
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