Convergence to the global frontier in South East Asia and CESEE: The role of external and internal anchors and their interactions

Abstract

The paper investigated the difference the EU made to the nature and speed of convergence process in the countries that joined the EU since 2004 relative to countries that converged outside such closely-knit supranational organization. It draws some lessons from this analysis for ASEAN countries. The most important lesson is that closely integrated supranational organizations can boost economic convergence to the global frontier by further unleashing the market forces of globalization. However, market-based rapid economic convergence requires matching improvement in institutional quality to make the process sustainable and to turn economic convergence into social convergence.

Keywords

• Regional integration
• European Union
• ASEAN
• Economic
• Social convergence