Unconditional Convergence in Manufacturing Productivity across U.S. States: What the Long-Run Data Show

Alexander Klein and Nicholas Crafts
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Alexander Klein: University of Kent

CAGE Online Working Paper Series from Competitive Advantage in the Global Economy (CAGE)

Abstract: This paper examines long-run unconditional convergence of labour productivity in manufacturing across 48 contiguous U.S. states. For that purpose, we construct a detailed panel data set of state-industry pairs with over 120 industries covering the period 1880-2007. We find that unconditional -convergence in manufacturing productivity was pervasive and rapid – 7.6% per year in 1880-2007 – and that manufacturing accounts for most of the unconditional convergence contribution to overall productivity growth over the long run: 61% in 1880-1940 and 91% in 1958-2007. We also examined broad U.S. regions and found that in the South the contribution of unconditional -convergence in manufacturing to aggregate productivity growth before World War II was weak not because of a slower convergence rate but a much smaller manufacturing sector. This paper examines long-run unconditional convergence of labour productivity in manufacturing across 48 contiguous U.S. states. For that purpose, we construct a detailed panel data set of state-industry pairs with over 120 industries covering the period 1880-2007. We find that unconditional β-convergence in manufacturing productivity was pervasive and rapid – 7.6% per year in 1880-2007 – and that manufacturing accounts for most of the unconditional convergence contribution to overall productivity growth over the long run: 61% in 1880-1940 and 91% in 1958-2007. We also examined broad U.S. regions and found that in the South the contribution of unconditional β-convergence in manufacturing to aggregate productivity growth before World War II was weak not because of a slower convergence rate but a much smaller manufacturing sector.

Keywords: convergence; economic growth; U.S. economic history; manufacturing belt JEL Classification: O47; N11; N12; R11 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-des, nep-hea, nep-law and nep-mac
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Citations: View citations in EconPapers (1)

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https://warwick.ac.uk/fac/soc/economics/research/c ... tions/wp660.2023.pdf

Related works:
Working Paper: Unconditional Convergence in Manufacturing Productivity across U.S. States: What the Long-Run Data Show (2023)
Working Paper: Unconditional Convergence in Manufacturing Productivity across U.S. States: What the Long-Run Data Show (2023)
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