The available quarterly GDP data indicate that the recession has clearly been winding down since the first quarter of 2014, with year-on-year growth in 2014 returning to positive territory (0.8%) for the first time since 2007, driven by higher exports of goods and services and increased private consumption.
The question remains as to which institutions have the greatest impact on convergence and through what causal mechanisms can they lead to both growth and convergence at the same time? My last slide depicts the linear relationship between the quality of institutions and gross domestic product (GDP). Countries with higher-quality institutions tend to have higher GDP per capita levels.