Is the Speed of Convergence a Good Proxy for the Transitional Growth Path?

Chris Papageorgiou () and Fidel Perez-Sebastian ()
Authors registered in the RePEc Author Service: Fidel Perez Sebastian

Departmental Working Papers from Department of Economics, Louisiana State University

Abstract: This paper compares transitional dynamics in two alternative R&D non-scale growth models, one includes endogenous human capital, whereas the other does not. We show that focusing on the speed of convergence to discriminate between the two models can be misleading. Our analysis suggest that a better alternative to discriminate between different growth theories is studying the whole adjustment path predicted by them. In addition, we find that the introduction of human capital makes the speed of convergence predicted by the model much less sensitive to exogenous shocks. This last result offers theoretical support to the similar convergence speeds estimated by the literature in different samples.

Date: 2005-10
New Economics Papers: this item is included in nep-dev
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https://www.lsu.edu/business/economics/files/workingpapers/pap05_10.pdf (application/pdf)

Related works:
Working Paper: IS THE SPEED OF CONVERGENCE A GOOD PROXY FOR THE TRANSITIONAL GROWTH PATH? (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:lsu:lsuwpp:2005-10

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