Income Convergence toward USA: New Evidences for Latin and South American Countries

Omid Ranjbar (), Tsangyao Chang and Chien-Chiang Lee ()

Iranian Economic Review (IER), 2016, vol. 20, issue 2, 141-162

Abstract: In this paper we test two versions of convergence hypothesis namely deterministic or conditional convergence and stochastic or catching up hypothesis using Carrion-i-Silvestre et al. (2005) stationary test. The results show Latin and South American countries (LSA) catching up process toward the USA failed in 1980s and somewhat in 1990s. But in 2000s most of them could lie in convergence path. Dispersion of break dates show that structural breaks in LSA convergence were affected by trade policies, terms of trade shocks and also war. For example, terms of trade shocks due to volatility of primary goods prices such as sugar, copper, cotton, petroleum oil, coffee, bauxite, aluminum, and rice affected the convergence process in LSA countries.

Keywords: Income Convergence; Catching up; Stationary Test; Structural Breaks; Latin and South America. (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
ftp://80.66.179.253/eut/journl/20162-2.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eut:journl:v:20:y:2016:i:2:p:141

Access Statistics for this article

Iranian Economic Review (IER) is currently edited by Dr.Hossien Abbasinejad

More articles in Iranian Economic Review (IER) from Faculty of Economics,University of Tehran.Tehran,Iran Contact information at EDIRC.
Bibliographic data for series maintained by [z.rahimalipour] ().