Productivity development and convergence across the EU Member States
Productivity development and convergence across the EU Member States

Summary/Abstract: The EU Member States have different levels of development. The state of development can be rated in various ways, using some economic or human development indictors. Enhancement of economic well-being of the EU countries belongs to the main goals of the 28 EU Member States. The improvement of well-being expects the convergence of socio-economic indicators. Labour productivity (LP) belongs to indicators of economic competitiveness reflecting the standard of living. Almost in all of the initial EU countries LP is higher than LP in the ≪new≫ EU members. In 2000 LP in purchasing power standard (PPS) was as low as 9,314 in Romania, but due to a strong increase by 256% LP reached PPS 33,188 in 2015. The lowest increase in LP in the same time span was achieved in Italy, where LP increased by only 19.4% from PPS 51,287 to PPS 61,244. Between the Visegrad Four countries Slovakia´s LP grew by a highest rate of 107.8% and so the proportion of LP in Slovakia compared to EU-28 average ( EU-28=100) increased from 53.7% in 2000 to 83.6% in 2015. Not only in Slovakia, but a strong jump of LP in PPS was achieved also in Poland (by 95.3%), in Hungary (by 72.5%), and in Czech Republic (by 67.6%). The convergence process of LP was typical for the period till the beginning of the economic crisis. From 2000 until 2008 the convergence of LP between the EU members was achieved in Beta- and Sigma-convergence. The coefficient of variation of LP decreased from 36.4% in 2000 to 27.4% in 2008. The economic crisis activated the divergence of LP. In 2015 the coefficient of variation increased to 31.7%. We expect that the convergence process of LP will successfully continue in periods of recovery and expansion of the EU economies.

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