Convergence

Danny Quah

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Kelly (1992) has recently shown that evidence on convergence cannot be taken as evidence against endogenous growth in general. This study uses a well-known class of stochastic growth models to show other dicul- ties with traditional empirical studies of convergence. Key parameters typically cannot be estimated consistently in cross-section regressions. When the parameters are assumed known, implications for convergence are unavailable except under restrictive and economically unmotivated assumptions. Those same assumptions that relate key parameters to cross-country convergence render cross-section regressions impossible to estimate consistently

Keywords: cross-country dependence; cross-country regression; increasing re- turns; stochastic growth; time-series regression (search for similar items in EconPapers)
JEL-codes: E32 O41 (search for similar items in EconPapers)
Pages: 23 pages
Date: 1996-04
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:2252

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