The convergence evolution in Europe from a complex networks perspective

The evolution of the convergence among the European countries, including both Eurozone as well as non-Eurozone economies, is investigated in this paper. To do so, we construct correlation-based networks and study them by employing the Threshold Weighted-Minimum Dominating Set (TW-MDS) algorithm and analyzing standard quantitative performance graph theory metrics. Each country is represented by a network node, while the edges represent the cross-correlations calculated for a specific macroeconomic variable, for a given time window. To study the intertemporal evolution of the network’s interconnections, we examine its structure in three consecutive time intervals: 1999-2004, 2005-2010 and 2011-2019. The empirical findings provide a mixed pattern. The European countries exhibit a common behavior over time for some macroeconomic variables, but not for all of them.