Resource capacity and economic growth convergence

Barnabé Walheer () and Sergio Perelman ()
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Barnabé Walheer: Université de Liège
Sergio Perelman: Université de Liège

Journal of Productivity Analysis, 2025, vol. 63, issue 3, No 9, 317-338

Abstract: Abstract Resource accumulation has been identified, with technological change, as a major explanatory factor of economic growth convergence. At the same time, resource capacity may act as a growth limiting factor. Under-investment may have a moderator effect on the economic growth convergence process, while path-dependencies may be observed. Using a tailored non-parametric model and a unique sample of 92 countries all around the world for the 1965–2019 period, we study the role of resource capacity from a new angle. First, we measure potential countries’ under-investment. Next, we quantify its role in the economic growth convergence process. Our findings reveal that under-investment exists and that it represents a brake on economic growth convergence. However, such an effect can be counterbalanced by promoting technological advances or creating a more favourable resource environment. Finally, we run several sensitivity tests to assess the robustness of our findings.

Keywords: economic growth; convergence; under-investment; non-parametric (search for similar items in EconPapers)
JEL-codes: C67 L60 O33 O47 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s11123-025-00755-5

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