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Journal of Economic Integration 2016 September;31(3) :472-530.
Impact of European Integration on Institutional Development

Nina Schönfelder Helmut Wagner 

University of Hagen, Hagen, Germany
Corresponding Author: Nina Schönfelder ,Tel: +49 23319872379, Fax: +49 2331987391, Email:
Copyright ©2016 Journal of Economic Integration
This paper investigates institutional development induced by European integration. We estimate a dynamic panel data model wherein institutional development is measured as positive changes in the Worldwide Governance Indicators, which are explained by the status of the European countries, for example, being a member of the euro area or an EU member state or a candidate country of the European Union, and additional controls. We confirm a positive effect arising from prospective EU membership, although being an EU member state does not influence the institutional development path. For members of the euro area, there is robust evidence for institutional deterioration in one particular area, namely control of corruption.

JEL Classification
F55: International Institutional Arrangements
O43: Institutions and Growth
Keywords: Institutional Development | Transition Economies | European Integration | Euro Area | Panel Data
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