The purpose of this research is to analyse the paths of economic growth and the real convergence between eleven countries of Central and Eastern Europe (CEE11) and fifteen countries of Western Europe (EU15). Particular attention is paid to the role of institutions in the process of developmental gap closure between the new and the old EU members. In the past 30 years, the Polish economy, as compared to the other CEE11 countries, was the fastest in reducing the development disparity with Western Europe. The analysis carried out demonstrates, however, that the sources of rapid and sustainable economic growth in Poland are drying up, and the process of real convergence is increasingly confronted with a number of development barriers which threaten its continuation.
These barriers are largely institutional and are the result of the patchwork nature of the variety of capitalism that emerged in Poland. The low complementarity present in the institutional matrix of the Polish economy and a significant mismatch between its major structural components result in diminished efficiency in the functioning of institutions in our country.
Such weaknesses have, until now, been compensated with factors such as the inflow of EU funds, increasing presence of transnational corporations, low labour costs and very high work intensity, which, acting together, allowed for a high rate of economic growth to be maintained. Yet Poland, in order not to lose the possibility of continuing on the path of real convergence, needs to define the new sources of “institutional comparative advantage”, i.e. to create a new development model which would avoid the dangers of regional disparities, low innovation drive, middle income trap, immature industrial policy and barriers in the development of the private sector. With a view to overcome these weaknesses, a deep correction of the existing institutional order needs to be contemplated, particularly concerning the mismatch between formal and informal institutions, their poor complementarity and the patchwork nature of the Polish variety of capitalism.