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Test of Convergence in Agricultural Factor Productivity: A Semiparametric Approach

Krishna P. Paudel, Mahesh Pandit and Biswo N. Poudel

No 104025, 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania from Agricultural and Applied Economics Association

Abstract: We tested for club convergence in U.S. agricultural total factory productivity using a sigma convergence test. We used the same club of states as used by McCunn and Huffman as well as different states within 10 clubs identified by the cluster analysis. Results showed convergence was evident only in a few club groups. Clusters group identified using a statistical method identified only converging clubs. Variables affecting total factor productivity among states were identified using parametric, semiparametric and nonparametric methods. Semiparametric and nonparametric methods gave a better fit than a parametric method as indicated by the specification test. Our results indicated that health care expenditure, public research and extension investment, and private expenditure are important variables impacting total factor productivity differences across states.

Keywords: Clubs; sigma convergence; cluster analysis; semiparametric and nonparametric methods; Productivity Analysis; Research Methods/ Statistical Methods (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eff
Date: 2011
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