ASSESING THE EFFECTS OF THE ECONOMIC AND FINANCIAL CRISIS ON INCOME CONVERGENCE IN THE EUROZONE

The introduction of the single currency within the European continent has represented an unpreceded decision that has brought closer than ever 19 European countries. Although the Euro Area has been founded on strong principles and mechanisms, one of the main concern of the European policy makers derive from the asymmetries that still persist between the Old and New Member States. Moreover, the economic prosperity and political stability of this group was recently threatened by the economic and financial crisis, calling into question the capacity of Eurozone to preserve its unity. The aim of this paper is to examine income convergence in the Eurozone, taking into consideration the evolutions which occurred before and after the outbreak of the economic and financial crisis. In this respect, we have calculated the absolute β- and σ-convergence for the New and Old Member States included in the Eurozone between 2000 and 2018 and during two sub-periods (2000-2008 and 2009-2018), illustrating that the Central and Eastern European countries have been catching-up at the beginning of the 21st century.