Convergence Is Alive and Well in Europe
The convergence process in Europe has bifurcated: the new member states from Central and Eastern Europe are catching up in terms of income per capita, as one would expect, with the initially poorer ones growing generally at a faster pace, including those which joined the euro area. Within the euro area, however, the North has diverged from the South since the start of the financial crisis. This pattern, reflecting East–West convergence but North–South divergence within the euro area, can be observed for a number of indicators, such as real wages, investment and consumption. The available projections for the next few years suggest that East–West convergence will continue and that some North–South convergence might re-start.
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