Skip to main content
SpringerLink
Log in
Book cover

A Quarter Century of Post-Communism Assessed pp 129–159Cite as

Palgrave Macmillan

Chapter 5: The V4 Countries and the EU: A Comparative Perspective

  • Chapter
  • First Online:

Abstract

Following the collapse of state socialism, the Visegrád 4 (V4) countries were rapidly integrated into the European networks of trade and investment. But the shock-therapy model caused significant imbalances in their economies, so their integration with Europe’s core economies was slow and partial. A comparison with the experiences of the southern EU entrants of two decades earlier (Greece, Spain and Portugal) highlights some distinctive characteristics of the transition. Although the southern members enjoyed stronger economic and institutional starting positions, the V4 Group enjoyed substantially higher growth rates, and by 2014 their GDP per capita levels approached those in Portugal and Greece. Within this broader structural picture, there have been significant differences in the trajectories of the individual countries in Central Eastern Europe, which is especially evident in migration and FDI flows.

This is a preview of subscription content, log in via an institution.

Chapter
USD   29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD   99.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD   139.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD   129.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Learn about institutional subscriptions

Notes

  1. 1.

    EU-15 denotes the fifteen EU Member States that joined the Union before the eastern enlargement in 2004.

  2. 2.

    The Balassa index of revealed comparative advantage (RCA), or normalised market share is defined as (x ij /x aj ) / (X i /X a ) = where x ij is exports of product j from country i; x aj is exports of product j from the reference area (EU27); X i is total exports of country i; and X a is total exports from the reference area (EU27). Index RCA higher than 1 indicates a comparative advantage and specialisation of a country in exports of particular good or service. All V4 countries accounted for the Balassa index values higher than 1 in exports of cars and parts, and consumer electronics in mid-2010s.

  3. 3.

    The Herfindahl–Hirschmann index (HHIj) is a measure of the degree of market concentration. It has been normalised to obtain values ranging from 0 to 1 (maximum concentration), according to the following formula: HHIj = ∑ (x ij / i j )2; where x ij = value of export for country j and product i. An index value that is close to 1 indicates a very concentrated market. On the contrary, values closer to 0, would demonstrate a homogeneous market between the exporters or importers. Source: UNCTAD (2015b).

Bibliography

  • Alfaro, L., Chanda, A., Kalemli-Ozcan, S., Sayek, S. (2004). FDI and economic growth: the role of local financial markets. Journal of International Economics, 64(1), 89–112.

    Article  Google Scholar 

  • Åslund, A. (2013). How capitalism was built. The transformation of Central and Eastern Europe, Russia, the Caucasus, and the Central Asia. Cambridge: Cambridge University Press.

    Google Scholar 

  • Baláž, V., Williams, A. M., Kollár, D. (2004). Temporary versus permanent youth brain drain: economic implications. International Migration, 42(4), 3–34.

    Article  Google Scholar 

  • Baldwin R. E. (2006). The euro’s trade effect. Working Paper No. 594. Frankfurt: European Central Bank.

    Google Scholar 

  • Bogumil, P. (2014). Composition of capital inflows to Central and Eastern Europe (CEE) – is Poland different? ECFIN Country Focus, 11(8), 1–9.

    Google Scholar 

  • Breisinger, C., Diao, X., Thurlow, J. (2009). Modeling growth options and structural change to reach middle income country status: The case of Ghana. Economic Modelling, 26(2009), 514–525.

    Article  Google Scholar 

  • Cieślik, A., Michałek, J., Michałek, A. (2014). Does the common currency increase exports? Evidence from firm-level data. International Journal of Management and Economics, 4, 8–22.

    Google Scholar 

  • Commission of the European Communities. (1995). Eastern and Central Europe 2000+. Final Report. Studies 2. Brussels: European Community.

    Google Scholar 

  • Dangerfield, M. V. (1995). The economic opening of Central and Eastern Europe: continuity and change in foreign economic relations. Journal of European Integration, 19(1), 5–42.

    Article  Google Scholar 

  • Égert, B., & Mihaljek, D. (2007). Determinants of house prices in Central and Eastern Europe, BIS Working Paper No. 286, Basel: Bank for International Settlements.

    Google Scholar 

  • Éltető, A. (Ed.) (2014). Foreign trade trends in the EU10 countries. In Mind the gap, integration experiences of the ten Central and Eastern European countries (pp. 41–60). Budapest: Centre for Economic and Regional Studies of the Hungarian Academy of Sciences Institute of World Economics.

    Google Scholar 

  • Estrin, S., & Uvalic, M. (2014). FDI into transition economies. Are the Balkans different? Economics of Transition, 22(2), 281–312.

    Article  Google Scholar 

  • European Commission. (2014). Research and innovation performance in the EU in 2014. Innovation Union progress at country level. European Commission, Directorate-General for Research and Innovation.

    Google Scholar 

  • European Commission. (2015a). Innovation Union scoreboard 2015. Internal Market, Industry, Entrepreneurship and SMEs.

    Google Scholar 

  • European Commission. (2015b). The 2015 ageing report, economic and budgetary projections for the 28 EU Member states (2013–2060). European Economy 3/2015.

    Google Scholar 

  • European Commission, Economic and Financial Affairs. (2015). AMECO database [online database]. http://ec.europa.eu/economy_finance/ameco/user/serie/SelectSerie.cfm. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015a). Average annual gross earnings by economic activity [online database]. http://ec.europa.eu/eurostat/web/labour-market/earnings/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015b). Balance of payment statistics [online database]. http://ec.europa.eu/eurostat/web/balance-of-payments/data/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015c). Financial account – direct investment [online database]. http://ec.europa.eu/eurostat/web/balance-of-payments/data/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015d). International migration [online database]. http://ec.europa.eu/eurostat/web/population-demography-migration-projections/population-data/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015e). Labour force survey [online database]. http://ec.europa.eu/eurostat/web/lfs/data/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015f). National accounts [online database]. http://ec.europa.eu/eurostat/web/national-accounts/data/database. Accessed September 2016.

  • Eurostat, the Statistical Office of the European Union. (2015 g). Population by educational attainment level [online database]. http://ec.europa.eu/eurostat/web/population-demography-migration-projections/population-data/database. Accessed September 2016.

  • Frankel, J., & Rose, A. (1998). The endogeneity of the optimum currency area criteria. Economic Journal, 108(441), 1009–1025.

    Article  Google Scholar 

  • Gowan, P. (1995). Neo-liberal theory and practice for Eastern Europe. New Left Review, 213, 3–60.

    Google Scholar 

  • Gurgul, H., & Lach, Ł. (2013). Export diversification and economic growth in transition: lessons from the 2008 financial crisis in CEE. Quantitative Methods in Economics, 14(1), 137–149.

    Google Scholar 

  • Holland, D., Fic, T., Rincon-Aznar, A., Stokes, L., Paluchowski, P. (2011). Labour mobility within the EU – the impact of enlargement and the functioning of the transitional arrangements. United Kingdom: National Institute of Economic and Social Research.

    Google Scholar 

  • Iossifov, P. (2014). Cross-border production chains and business cycle co-movement between Central and Eastern European countries and euro area member states. Working Paper No. 1628. Frankfurt: European Central Bank.

    Google Scholar 

  • Kahanec, M. (2012). Labor mobility in an enlarged European Union. Discussion Paper No. 6485. Bonn: Institute for the Study of Labor (IZA).

    Google Scholar 

  • Kutan, A., & Vukšić, G. (2007). Foreign direct investment and export performance: empirical evidence. Comparative Economic Studies, 49 (3), 430–445.

    Article  Google Scholar 

  • Lensink, R., & White, R. (1998). Does the revival of international private capital flows mean the end of aid? An analysis of developing countries access to private capital. World Development, 26(7), 1201–1219.

    Article  Google Scholar 

  • Makki, S. S., & Agapi, S. (2004). Impact of foreign direct investment and trade on economic growth: evidence from developing countries. American Journal of Agricultural Economics, 86(3), 795–801.

    Article  Google Scholar 

  • Martin, R. (2010). Roepke lecture in economic geography-rethinking regional path dependence: beyond lock-in to evolution. Economic Geography, 85(1), 1–27.

    Google Scholar 

  • Martin, R. L., & Sunley, P. J. (2006). Path dependence and regional economic evolution. Journal of Economic Geography, 6, 395–438.

    Article  Google Scholar 

  • Medve-Bálint, G. (2014). The role of the EU in shaping FDI flows to East Central Europe. Journal of Common Market Studies, 52(1), 35–51.

    Article  Google Scholar 

  • OECD, the Organisation for Economic Co-operation and Development. (2015). Trade in Value Added (TIVA) [online database]. http://stats.oecd.org/BrandedView.aspx?oecd_bv_id=tiva-data-en%26doi=data-00648-en. Accessed September 2016.

  • Płoszaj, A., & Olechnicka, A. (2015). Running faster or measuring better? How is the R&D sector in Central and Eastern Europe catching up with Western Europe? Working Paper No. 3.06. Growth–innovation – competitiveness: fostering cohesion in Central and Eastern Europe (GRINCOH). Warsaw: Centre for European Regional and Local Studies (EUROREG), University of Warsaw.

    Google Scholar 

  • Rose, A. K., & Stanley, T. D. (2005). A meta-analysis of the effect of common currencies on international trade. Journal of Economic Surveys, 19 (3), 347–365.

    Article  Google Scholar 

  • Sheehy, J. (1994). Foreign direct investment in the CEECs. In: European economy the economic interpenetration between the European Union and Eastern Europe (vol. 6, pp. 129–148). European Commission.

    Google Scholar 

  • Sixta, J., Vltavská, K., Fischer, J. (2013). The development of gross domestic product in the Czech Republic and Slovakia between 1970 and 1989. Ekonomický časopis, 61(6), 549–562.

    Google Scholar 

  • Śmiech, S., & Zysk, W. (2014). The influence of foreign direct investment on foreign trade in the Visegrád countries from 2001 to 2011. Entrepreneurial Business and Economics Review, 2(3), 7–18.

    Article  Google Scholar 

  • Smith, A., & Swain, A. (2010). The global economic crisis, Eastern Europe and the Former Soviet Union: models of development and the contradictions of internationalization. Eurasian Geography and Economics, 51(1), 1–34.

    Article  Google Scholar 

  • Szijártó, N. (2014). Monetary and financial integration in EU10 countries. In: A. Éltető (Ed.), Mind the gap, integration experiences of the ten Central and Eastern European countries (pp. 83–105). Budapest: Centre for Economic and Regional Studies of the Hungarian Academy of Sciences Institute of World Economics.

    Google Scholar 

  • Túry, G. (2014). Automotive industry in the EU10 economies: Developments in the past decade. In A. Éltető (Ed.), Mind the gap, integration experiences of the ten Central and Eastern European countries (pp. 41–60). Budapest: Centre for Economic and Regional Studies of the Hungarian Academy of Sciences Institute of World Economics.

    Google Scholar 

  • United Nations. (1995). Geographical structure of east European trade. Economic Bulletin for Europe, 47(5), 109–123.

    Google Scholar 

  • UNCTAD, United Nations Conference on Trade and Development. (2015a). World investment report 2015: annex tables [online database]. http://unctad.org/en/Pages/DIAE/World%20Investment%20Report/Annex-Tables.aspx. Accessed September 2016.

  • UNCTAD, United Nations Conference on Trade and Development. (2015b). International trade in goods and services [online database]. http://unctadstat.unctad.org/wds/ReportFolders/reportFolders.aspx?IF_ActivePath=P,15912. Accessed September 2016.

  • Williams, A. M., Baláž, V., Zajac, S. (1998). The EU and Central Europe: the reinternationalisation of economic relationships. Tijdschrift voor Economische en Sociale Geografie, 89(2), 131–149.

    Article  Google Scholar 

  • Williams, A. M., & Baláž, V. (2001). Capital mobility in transition countries of Central Europe: macroeconomic performance factors and structural policies. Ekonomický časopis, 49(2), 242–271.

    Google Scholar 

  • World Bank. (2015). World development indicators [online database]. http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators. Accessed September 2016.

  • Zon, H. van (1996). The future of industry in Central and Eastern Europe. Aldershot: Averbury Press.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. The Institute for Forecasting of the Slovak Academy of Sciences, 81364, Bratislava, Slovakia

    Vladimir Baláž

Authors
  1. Vladimir Baláž
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Katarina Karasová
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Allan M. Williams
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Vladimir Baláž .

Editor information

Editors and Affiliations

  1. University of California, Berkeley, California, USA

    M. Steven Fish

  2. University of Sydney, Sydney, Australia

    Graeme Gill

  3. University of Canterbury , Christchurch, New Zealand

    Milenko Petrovic

Rights and permissions

Reprints and permissions

Copyright information

© 2017 The Author(s)

About this chapter

Cite this chapter

Baláž, V., Karasová, K., Williams, A.M. (2017). Chapter 5: The V4 Countries and the EU: A Comparative Perspective. In: Fish, M., Gill, G., Petrovic, M. (eds) A Quarter Century of Post-Communism Assessed. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-43437-7_6

Download citation

Publish with us

Policies and ethics

Search

Navigation