Comparative Economic Studies

, Volume 53, Issue 2, pp 261–290 | Cite as

Beyond the Crisis: Prospects for Emerging Europe

  • Zsolt Darvas
Regular Article


This paper assesses the impact of the 2008–2009 global financial and economic crisis on the medium-term growth prospects of the countries of Central and Eastern Europe, the Caucasus and Central Asia, which began an economic transition about two decades ago. We use cross-country growth regressions, putting special emphasis on a proper consideration of the crisis and robustness. We find that the crisis has had a major impact on the within-sample fit of the models used and that the positive impact of EU enlargement on growth is smaller than previous research has shown. The crisis has also altered the future growth prospects of the countries studied, even in the optimistic but unrealistic case of a return to pre-crisis capital inflows and credit booms.


crisis economic growth growth regressions transition countries 

JEL Classifications

C31 C33 O47 



I am grateful to conference participants at the CICM Conference ‘20 Years of Transition in Central and Eastern Europe: Money, Banking and Financial Markets’, the Tallinn University of Technology Conference ‘Economies of Central and Eastern Europe: Convergence, Opportunities and Challenges’, and ECOMOD 2010, and seminar participants at Bruegel, the European Bank for Reconstruction and Development and the Vienna Institute for International Economic Studies for comments and suggestions. Without implicating him in any way, I would also like to thank Alessandro Turrini for his comments and suggestions. Excellent research assistance by Maite de Sola, Juan Ignacio Aldasoro and Lucia Granelli is gratefully acknowledged as well as editorial advice from Stephen Gardner. Bruegel gratefully acknowledges the support of the German Marshall Fund of the United States to research underpinning this paper.


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Copyright information

© Association for Comparative Economics 2011

Authors and Affiliations

  • Zsolt Darvas
    • 1
    • 2
    • 3
  1. 1.BruegelBrusselsBelgium
  2. 2.Institute of Economics of the Hungarian Academy of SciencesHungary
  3. 3.Corvinus University of BudapestHungary

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