This paper investigates the economic convergence dynamics of 16 Central, Eastern, and South-Eastern European (CESEE) countries toward the European Union average over the period 2000–2022. While traditional unconditional β-convergence and σ-convergence models often assume homogeneous catching-up processes, this study employs a panel-quantile regression framework (Canay, 2011) to account for distributional heterogeneity and unobserved fixed effects. The findings confirm that convergence is not uniform across the income distribution. Lower-income countries in the Western Balkans and South-East Europe exhibit significantly faster conditional convergence rates (β = −0.082 at the 10th percentile) compared to their higher-income peers in Central Europe (β = −0.028 at the 90th percentile). Furthermore, σ-convergence analysis reveals a reduction in income dispersion from 0.438 in 2000 to 0.337 in 2022, though the pace of convergence has slowed since the 2008 Global Financial Crisis. These results imply that policymakers should prioritize targeted structural and institutional reforms to accelerate catching up, overcome middle-income traps, and sustain long-term convergence in the region.
Keywords: Central and Eastern Europe, Western Balkans, economic convergence, panel-quantile regression
