Journal of Common Market Studies, 2016, 54, (3), pp.544-568
We examine the effects of Eastern and Northern enlargement of the EU on regional business-cycle synchronisation and sector
specialisation. Difference-in-difference estimates show that cyclical synchronicity decreased and differences in sector structure
increased in acceding region-pairs after Eastern enlargement. For Northern enlargement, results are more ambiguous. Moreover,
in both enlargement episodes, region-pairs with highly synchronous business cycles before accession experienced weaker cyclical
and structural convergence than region-pairs with less synchronous cycles. Likewise, region-pairs with more similar sector
structures before accession experienced stronger divergence (or weaker convergence) of structural similarity and business-cycle
synchronicity after the enlargement. We argue that these results call for developing more differentiated hypotheses on EU
enlargement's effects on business-cycle synchronisation and sector specialisation.