This paper evaluates the effect of the EU Eastern enlargement in May 2004 on the Gross Domestic Product (GDP) of border regions in the old member states. The effect is identified with the Synthetic Control Method (SCM) that allows the evaluation of the enlargement effect in a causal way. Results show that on average, no significant enlargement effect can be observed. The average effect, however, hides the fact that border regions are differently affected by the enlargement. The heterogeneous enlargement payoffs seem to be driven by the regional economic performance prior to the enlargement, the regional industrial structure and the regional endowment with physical infrastructure.
Border Regions Economic Integration EU Enlargement Synthetic Control Method