Has the world converged? A robust analysis of non-monetary bounded indicators

Suman Seth () and Gaston Yalonetzky

No 398, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: Most non-monetary development indicators are bounded and many of them are presented in terms of either attainments or shortfalls. Whether an absolute approach or a relative approach should be undertaken to assess cross-country convergence of these indicators has been a subject of debate. Revisiting this debate, we provide three arguments explaining why a relative approach is misleading and, instead, an absolute approach is more appropriate. We assess the presence of absolute convergence across countries in several non-monetary development indicators by applying a number of absolute inequality indices. Although we find numerous instances of absolute convergence, these are rarely robust to alternative specifications of indices. We additionally contribute to the available methodological toolkit of convergence analysis by employing absolute-Lorenz curves to assess the robustness of absolute cross-country convergence, which is rarely conducted in the literature, and never to date with absolute-Lorenz curves. We also clarify the relationship between different relevant notions of egalitarian progress and elucidate how progress in these indicators relates to changes in their convergence using absolute Lorenz curves.

Keywords: Absolute convergence; non-monetary development indicators; absolute Lorenz curve; egalitarian progress; bounded indicators; consistent inequality indices. (search for similar items in EconPapers)
JEL-codes: I31 O47 O57 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2016-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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