CASE Policy Briefs, enlargement, Europe, Macroeconomics and macroeconomic policy, price convergence, Trade, economic integration and globalization

When can we expect price convergence in the enlarged EU?

The recent waves of EU enlargement (2004 and 2007) have given new impetus to the discussions about the political and economic consequences of further expansion of the Union. While controversial issues such as tax competition, reallocation of businesses and labour migration are cause for extensive debate, another major economic goal - the enlargement of the internal market for goods - seems to be proceeding smoothly without major obstacles. Yet it also has a profound impact on the lives of EU citizens; most notably, it affects day to day shopping patterns, infl uencing what Europeans are able to buy and how much they must pay for it. A recently completed project carried out by CASE and DIW analyzed the effect of the 2004 EU enlargement on price levels. This brief concisely presents select issues related to price convergence and links them with the results of the project.

For the full report on Price Convergence in the Enlarged Internal Market see CASE Network Reports No. 76, 2008