EconPapers    
Economics at your fingertips  
 

Beta, sigma and club convergence: Indian experience from 1980 to 2015

Sulekha Hembram () and Sushil Haldar ()
Additional contact information
Sulekha Hembram: Jadavpur University

Indian Economic Review, 2019, vol. 54, issue 2, No 6, 343-366

Abstract: Abstract The debate over standard β, σ, and club convergence is empirically re-examined in India with respect to per capita net state domestic product (PCNSDP) across 22 states over time (viz. 1980–1981 to 2015–2016). We go beyond the σ convergence, and the distribution-sensitive inequality measure such as generalized entropy is used to exploring the pattern of distribution of PCNSDP among states over time. We find σ divergence, rising trend of inequality of PCNSDP with a higher sensitivity to the right tail of the distribution. The results show that there exists absolute β divergence but conditional β convergence; the conditioning variables which appear to be significant are per capita bank deposit (PCBD) and composite physical infrastructure index. The kernel density estimation and Markov’s transitional probability matrix (TPM) show that there exists club convergence among the states; we find higher stability, but lower mobility indices during different time intervals confirm the existence of club convergence in the short run; however, the long-run TPM gives the opposite results. The long-run TPM shows that very few states are stable to their respective clubs, but most of the states have been experiencing transitional movement from higher to lower income group over time; thus, our results do not support the earlier findings of ‘missing middle’.

Keywords: Club convergence; Stochastic kernel; Markov process; Generalized entropy; Transitional probability matrix (search for similar items in EconPapers)
JEL-codes: C14 C23 H54 H59 O49 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s41775-019-00056-3 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:inecre:v:54:y:2019:i:2:d:10.1007_s41775-019-00056-3

Ordering information: This journal article can be ordered from
https://www.springer.com/economics/journal/41775

DOI: 10.1007/s41775-019-00056-3

Access Statistics for this article

Indian Economic Review is currently edited by Uday Bhanu Sinha, Abhijit Banerji, Shreekant Gupta and J.V. Meenakshi

More articles in Indian Economic Review from Springer
Bibliographic data for series maintained by Sonal Shukla ().

 
Page updated 2020-05-20
Handle: RePEc:spr:inecre:v:54:y:2019:i:2:d:10.1007_s41775-019-00056-3