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instruments, the justification for using such a proxy is even greater, because of the
general convergence in per capita incomes by 1990.
Given that Cyprus appeared to be an average performer across most of the key
indicators in ail three groups up to 1960, and that no pervasive divergence occurred
after 1964 across this range of growth related variables, despite the removal of
Cyprus as a near mean performer after 1964 and the economic turmoil of the 1980s,
then the peer groups offer a yardstick for how Cyprus could have done had war and
ethnie division not interrupted development. Performing somewhere in the middle
before the constitution broke down, Cyprus should have done at least as well as the
worst average group performance after 1963; anything significantly less should be
seen as the economic cost to Cyprus of the "Cyprus problem".
Some preliminary benchmarks
Having chosen three peer groups for the Cypriot economy, there are now three
proxy measures, a range of possible growth rates to compare with the extrapolations
attempted earlier. With a little less uncertainty, and no longer being dépendent on
too few observations, a benchmark for ail island integrated Cypriot growth can be
taken to 1990 and compared with the combined real income of both the de facto
Cypriot économies, to see whether the island as a whole and the income of each
respective community meets with expectations thus formed. This work will however
be split into two parts, the first attempting to hazard another estimate of the cost of
division by 1980. This section will compare Cypriot economic growth with peer
group averages to 1980, when most of the divergence could be assumed to be the
immediate conséquences and costs of war and division. The second part will extend
the exercise to 1990, comparing Cypriot growth in the 1980's, when two separate
de facto économies and economic policies could be seen to have emerged.
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