Urbanization and Economic Development in Post-Communist Romania
Urbanization and Economic Development in Post-Communist Romania

Summary/Abstract: The goal of the present research was to assess the relationship between urbanization and economic development in post-communist Romania. According to economic literature, the degree of economic development should positively influence the percentage of people living in cities. The vector error correction model finds the existence of a co-integration relationship stable in time, but with a negative coefficient. Other time series methods used to verify the above results also show that in Romania, the urbanization rate is negatively influenced by the GDP growth rate. Moreover, the connection between the two variables involved is weak in time. The main consequence of the finding is the fact that there is a short and medium term relationship between the urbanization rate and the GDP growth rate in Romania, but no long term relationship.

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