The Econometrics of Convergence

Steven Durlauf, Paul Johnson and Jonathan Temple

Chapter 23 in Palgrave Handbook of Econometrics, 2009, pp 1087-1118 from Palgrave Macmillan

Abstract: Abstract The presence or absence of convergence between rich and poor countries represents one of the most important questions in the new growth economics. New growth theories have been explicitly designed to explain forms of divergence which do not appear in their neoclassical counterparts. Despite substantial empirical work on convergence, there is no consensus as to whether it is present in cross-country data. This chapter surveys the econometrics of convergence as well as the range of empirical claims that have appeared. Particular attention is given to the relationship between statistical versus economic notions of convergence. We argue that the disparities in claims across empirical studies can to some extent be understood as reflecting inadequate attention to the relationship between the statistical and economic notions.

Keywords: Gross Domestic Product; Balance Growth Path; Penn World Table; Convergence Club; Initial Income (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (26)

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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-24440-5_23

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DOI: 10.1057/9780230244405_23

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