Scandinavian Working Papers in Economics

Discussion Paper Series in Economics,
Norwegian School of Economics, Department of Economics

No 5/2024: Convergence between the Baltic and the Nordic economies: Some reflections based on new data for the Baltic countries

Lars Christian Bruno () and Ola Honningdal Grytten ()
Additional contact information
Lars Christian Bruno: BI Norwegian Business School, Postal: BI, Department of Economics, Byfjordparken 17, 4007 Stavanger, Norway
Ola Honningdal Grytten: Dept. of Economics, Norwegian School of Economics and Business Administration, Postal: NHH, Department of Economics, Helleveien 30, N-5045 Bergen, Norway

Abstract: This short paper uses recent estimates of GDP per capita for the Baltic countries for the 1919-2020(22) period to test for convergence between the Baltic and the Nordic economies. Drawing from the methodology used in Bernard and Durlauf (1996) and Greasley and Oxley (1997), we utilise a time-series approach to test for bivariate convergence between the various Baltic and Nordic economies. We find some evidence of conditional convergence and catching up for the interwar period, 1919-1939 and the post-Soviet era 1993-2022, when for the communist growth period until 1988 we find no trace of convergence, when thereafter during the last years of communism, the Baltic economies went into a severe and devastating recession.

Keywords: Baltic; Scandinavia; economic growth; convergence; historical national accounts

JEL-codes: N14; N34; N94; O47; O52

Language: English

16 pages, April 18, 2024

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