R13 - General Equilibrium and Welfare Economic Analysis of Regional EconomiesReturn

This paper aims to use cluster analysis to monitor changes in the social regimes of EU countries in the context of their economic situation. In the first step, the paper provides an overview of theoretical studies and categorizes countries into individual social regimes based on available studies. Subsequently, hierarchical cluster analyses are performed for 2007 and 2019, one for a group of redistributive variables and one for socio-economic variables. The cluster analysis confirmed that differences among individual social regimes are blurred over time, and belonging to a social regime does not automatically lead to occurrence in the same cluster. The new and old member states are mixed in terms of redistributive variables, while economic differences among these countries are still present.

In this paper we analysed to which extent the changes in market potentials in Poland have been a cause for increasing income disparities, which were observed across Polish regions from 1995 to 2008. To do so we derived and estimated a New Economy Geography Model, which relates per capita GDP growth rates to changes in market potential. The results of the crosssection estimations of the model for the period 1995-2008 and for its different subsamples point to a positive and significant effect of changing market potentials in per capita GDP growth rates. Due to the fact that core-economic regions have mostly benefited in terms of market potential growth during 1995-2008, these results confirm the important role played by the relative changing in market potentials across Polish regions in widening the gap between poor and rich regions in the country in the period of analysis.